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China's farm machinery reaps profits in ASEAN

2014-09-17 12:59 Xinhua Web Editor: Qin Dexing

China's top farming equipment manufacturers are seeking investment opportunities in Southeast Asia at the ongoing 11th China-ASEAN Expo held in Nanning in south China's Guangxi Zhuang Autonomous Region.

China National Machinery Industry Corporation (SINOMACH), the country's first Fortune 500 company in the machinery sector, has launched an investment program in Vietnam and Thailand in an effort to break into the local market using its advantages in capital and research and development.

Liu Dagong, chief economic manger of SINOMACH, noted the two sides are complementary, as Association of Southeast Asian Nations (ASEAN) members need to improve their agricultural technology and mechanization level.

Agriculture serves as a pillar sector in China and most ASEAN regions, driving demand for farm machines. For example, Vietnam exported 27.4 billion U.S. dollars worth of farm produce in 2013, accounting for around 20 percent of its total exports.

"China's agricultural machinery exports increased around 12 percent from a year ago in the first half of 2014, driven by demand from the ASEAN market, which has become one of the three largest buyers of the products," Liu said.

Major Chinese tractor producer YTO Group Corporation, a pioneer in exploring the ASEAN market, has already reaped a good harvest. Its joint ventures in Indonesia and Thailand saw combined annual revenues of more than 100 million yuan (16.27 million U.S. dollars) in the past few years.

Zhao Shanshui, board chairman of the company, said it's necessary for Chinese companies to explore new territory in the ASEAN market and join global competition.

China's industrial advantage and huge market demand from ASEAN will be a solid foundation for business cooperation, Zhao said.

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