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BASF to Expand Business with $5.6 Billion
German-based chemicals giant BASF is to expand its business in China.
BASF will invest more than 5 billion euro ($5.6 billion) in the Asia Pacific region in the next five years, according to Jurgen Hambrecht, member of the board of executive directors of BASF Group, participating in a media roundtable discussion organized by BASF in Hong Kong last week.
"The Republic of Korea and China will receive the company's largest investment in this area," said Hambrecht.
The investment of about $3.5 billion for China will mainly go into the two chemical sites in Caojing of Shanghai and Nanjing, capital city of East China's Jiangsu Province.
"For the moment, we are waiting for final approval for both sites. Once we have final approval, start-ups on the two sites should be completed in 2004 or 2005," said Hambrecht.
BASF has been satisfied with operations in China in the past several years. Hambrecht said: "Except for two plants started up recently, all BASF plants in China are profitable now."
In 1999, the company even saw a surge of 46 per cent increase in net sales compared with that in 1998 in China.
Erich Binckli, president of BASF East Asia Regional Headquarters Limited attributes the increase to BASF's increased production volume.
"We are expecting even larger business expansion in China if it enters the World Trade Organization (WTO)," said Hambrecht in reference to the agreement signed between China and the European Union on May 19.
Hambrecht said the business environment in China will become more competitive but more open and "the legal framework will be improved."
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