China-based Jiangsu General Science Technology Co Ltd plans to invest 1.3 billion yuan ($203 million) to set up a tyre-processing plant in Cambodia with a production capacity of six million units per year, Tyrepress Media reported on June 7.
Slated for Sihanoukville Special Economic Zone, construction is expected to take 15 months, with the plant operational in September next year, the company said.
The industrial park – the Kingdom’s largest – lies on a whopping 11.13sq km in Bit Traing commune’s Pou Thoeung village in Preah Sihanouk province’s Prey Nop district.
Horn Saphan, director of the Department of International Marketing and Cooperation under the Ministry of Agriculture, Forestry and Fisheries’ General Directorate of Rubber, welcomed the plan, saying it could provide a boost to the domestic rubber market.
“We have not yet set up a rubber processing plant to absorb our raw rubber material,” he said, adding that the ministry would provide support and cooperate with investors to make the work go smoothly, once a concrete plan is drawn up.
“What is important is that the company must have a clear plan. We will then meet to get an understanding of the objectives behind the plan and future direction. As for our rubber products, we produce a lot every year, which can be supplied” to the plant, he said.
He noted that although the situation surrounding the Covid-19 epidemic has caused economic difficulties around the world, Cambodia’s rubber sub-sector seemingly had a strong market in the first few months of 2021 compared to previous years.
“Cambodia’s rubber depends only on foreign markets, so we face some difficulties, but if the company intends to set up a factory that uses natural rubber as raw material, it is the best type to suit the government’s needs,” he said.
And interest by foreign investors in developing the Kingdom’s tyre industry has gained real traction in recent years.
Although the considerable investment planned by Jiangsu General Science Technology marks a significant step towards the development of the domestic tyre industry, it is not the only foreign investor that has set its sights on the market.
China’s Sailun Group Co Ltd is also considering setting up a plant in Cambodia to produce tyres for passenger vehicles in the Kingdom, Tyrepress Media reported on March 9.
According to a feasibility study revealed in a report published by Tyrepress Media, the tyre-maker is interested in building a facility within Svay Rieng province’s QiLu (Cambodia) Special Economic Zone that is capable of making five million semi-steel radials a year.
The project will reportedly require an estimated investment of 1.18 billion yuan ($181.4 million).
And the Council for the Development of Cambodia in February approved a final registration certificate for Cart Tire Co Ltd’s $15 million tyre factory in QiLu Bavet Special Economic Zone in Svay Rieng province’s Bavet town.
Cambodia exported $280.34 million worth of latex last year, up by 25.21 per cent from $223.9 million in 2019, according to the Ministry of Commerce.
The Kingdom imported $1.0995 billion worth of cars last year, down by 36.6 per cent from $1.73431 billion in 2019, commerce ministry figures show.