International Chemical Giant to Increase Investment in China

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Last updated at: (Beijing Time) Wednesday, July 31, 2002

International Chemical Giant to Increase Investment in China

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BASF Aktiengesellschaft of Germany, one of the world's leading multinational chemical giants,has announced that it will solely invest in a large chemical project using its latest patented technology in Shanghai.

The announcement was made by Stefan Marcinowski, a member of the board of executive directors of BASF, in Shanghai.

The planned production facility, to be built in the Caojing Chemical Industrial Zone in southern Shanghai, is expected to go into operation in 2004, producing 80,000 tons of tetrahydrofuran (THF) and 60,000 tons of polytetrahydrofuran (PolyTHF) annually. The output of THF will be the highest in the world.

Sources with BASF said the production equipment could turn butane directly into THF and then use THF in manufacturing PolyTHF,resulting in no by-products.

Marcinowski said China's entry into the World Trade Organization had brought about new market opportunities and fiercer competition for foreign companies. Using new technologies could increase production efficiency and beat rivals in terms of cost, thus securing BASF's stand on the world chemical market.

At the same time, Dietmar Nissen, president of BASF East Asia, announced that BASF would select six outstanding Chinese young people from four Chinese universities and send them to BASF's headquarters in Germany to receive three weeks of training.

Sources disclosed that 28 Chinese students had been selected tostudy in Germany by BASF since 1997, five of whom had joined BASF's subsidiaries in China and were playing a role in technical research and development.

Dietmar Nissen called the training a win-win plan. He said thisnot only helped broaden Chinese students' vision, but also opened a channel for BASF to select and recruit talented people in China.

Like many other multinational corporations, BASF has increased its technological investment in China in recent years while expanding its production capacity. BASF has set up research and development centers to develop new technologies to meet the needs on the Chinese market.

Dietmar Nissen said BASF once used renovated technologies in its subsidiaries and joint ventures in China, but this was out of keeping with the times. He stressed that BASF had made it a strategy for future development in China to use new techniques, develop new products and explore new markets.

BASF's total sales volume in 2001 was 32.5 billion euros, of which 1.1 billion euros came from China.

Nissen said BASF's business in China had maintained a two-digitgrowth rate for several consecutive years, and BASF was sure to put more funds and technologies into China to meet the huge demandfor chemicals which are expected to have a worth of 230 billion euros by 2015.

BASF has set up eight enterprises in China with a total investment of 600 million US dollars.

Moreover, several other projects funded by BASF are under construction. They include one in Nanjing, capital of east China'sJiangsu Province. The project can produce 600,000 tons of ethyleneannually when it goes into operation in 2005.

BASF's investment plan also includes a program which is designed to produce 160,000 tons of methane di-isocyanate (MDI) and 130,000 tons of toluene di-isocyanate (TDI) annually. This one-billion-euro program, also located in Caojing Chemical Industrial Zone, is to be jointly funded by BASF, Huntsman Polyurethanes company and several Chinese firms.

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