Due to domestic over-capacity and anti-dumping investigations carried out by other nations against the country, many Chinese enterprises have begun toying with the idea of setting production base in overseas markets.
One such local enterprise to have taken this step is Kangnai Group, a leading shoe-manufacturing company. Kangnai Group, along with Chinese Government's support, has established the Russian Ussuriisk Economic Trade Cooperation Area (RUETCA).
RUETCA, whose layout plan neared completion on August 6 this year, is the first Chinese industrial park in Russia. It covers an area of 2.28 million square meters and has invited investment worth 2 billion yuan.
One of the advantages that Chinese enterprises will enjoy in this park is the low rate of import tariff. For example, the import tariff rate levied on a pair of half-finished Chinese shoes in 5 percent. However, if the remaining production process of the same pair of shoes is done in RUETCA and if it is sold in either Russia or Europe, the average tariff rate will decrease by 50 percent. In case of shoes, the decrease rate could be as much as 70 percent.
Already, six Chinese enterprises have joined this trade cooperation area. In all, 18 Chinese enterprises plan to join this park, which is slated to be ready in five years' time.
Fibre2fashion News Desk - China
marketing@alchempro.com
