On January 11, the US$300 million General Science Cambodia project successfully passed the filing of overseas investment by the Department of Commerce of Jiangsu Province. So far, this project has become the first project of Wuxi to invest in RCEP member countries after the Regional Comprehensive Economic Partnership Agreement (RCEP) came into effect, and it is also the first project of Jiangsu Province to invest over USD 100 million in RCEP member countries after RCEP came into effect.
Since January 1, RCEP has come into effect, forming the largest FTA covering 30% of the world's population and trade volume, whose member countries include China, Japan, South Korea, Australia, New Zealand and ten ASEAN countries. The Asia-Pacific region is not only the world tire manufacturing center and raw material supply center, but also will become the main growth area of the global tire market in the future. the entry into force of RCEP will have a profound impact on the upstream and downstream development of the tire and rubber industry chain.
China Rubber magazine learned that the Cambodia project of GS is the second production base established overseas by the company in response to the "One Belt, One Road" initiative. The construction period of the project is about 18 months, and after full production, the annual production capacity will reach 5 million semi-steel radial tires and 900,000 all-steel radial tires, which is expected to create more than 1,600 jobs for the local area, with an average annual revenue of 2.2 billion yuan and an average annual profit of 240 million yuan.
The project is located in Sihanoukville Special Economic Zone, Cambodia, and is jointly developed and constructed by Hongdou Group, the controlling shareholder of GS, and Chinese and Cambodian enterprises. It is a landmark project of Jiangsu Province at the intersection of "One Belt and One Road", and the only national economic and trade cooperation zone with bilateral government agreement signed between China and Cambodia.
As one of the leading national tire enterprises in China, GS has accelerated its international development and industrial layout in recent years, formulated the "5X strategic plan", firmly grasped the new development opportunities of domestic and international double cycle, and continuously enhanced its core competitive advantages, and its products are sold well in many countries and regions such as the United States, Europe, Asia and Africa.
Before the implementation of the RCEP agreement, GS maintained close contact with all parties and actively invited relevant business experts to discuss how to make full use of RCEP to take advantage of both production and sales, and implement it on the ground.
In December 2021, GS made an announcement to increase the capital for the company's first overseas project - Thailand plant by USD 78 million to further expand the scale of production capacity, optimize the warehousing and logistics system and carry out production and operation activities, including but not limited to the purchase of machinery and equipment, construction of warehousing and ancillary facilities and paving working capital.
Since its commencement of operation, GS's Thailand plant has overcome the epidemic, shipping and other unfavorable factors and has always maintained a good momentum of both production and sales, successfully completing the set targets. Based on the successful experience of the Thailand project and the opportunity of RCEP, in December 2021, GS signed the largest industrial investment project in Cambodia since the establishment of Sihanoukville Special Zone - High Performance Tire Project.
In the general environment of domestic and foreign demand rebound, the dividends of RCEP signing will be gradually released, leading Chinese tire enterprises and member countries to further "speed up" the trade between them.
GS said, in the future, will actively seize the RCEP policy opportunities, fully understand the application of RCEP rules, and RCEP countries to strengthen production capacity cooperation, and actively embedded in the global innovation chain. On the other hand, GS will also rely on the three production bases in China, Thailand and Cambodia, and actively explore new modes of foreign trade development, accelerate the implementation of the process of internationalization of production, internationalization of research and development, internationalization of marketing, and strive to build a national tire enterprise with international influence.
