Chinese tradition credits Cai Lun, an official at the Eastern Han court, with paper. In 105, he reported his improved papermaking to the emperor, who praised him and spread the method across the country. Cai Lun made paper from cheap materials, bark, rags, hemp ends and old fishing nets, which greatly lowered its cost.
Paper existed before him. In 1957, paper from the second century BC was found at Baqiao, east of Xi’an. Chinese Wikipedia describes Cai Lun as an important improver who made papermaking more reliable and cheaper.