Foshan sees future in equipment production

Foshan, a traditional manufacturing city in Guangdong province, has outlined an ambitious plan to transform itself into a leading equipment manufacturing base in the booming Pearl River Delta, a senior government official said.

Lu Yi, acting mayor of Foshan, said the city will set up a development fund for the equipment manufacturing industry, which means at least 10 million yuan ($1.63 million) would be invested every year to support technological development starting in 2015.

"Along with the increased investment, we will offer preferential policies such as tariff exemptions for imported raw materials and parts," Lu said.

Equipment manufacturing projects will get priority in access to land and energy, Lu said.

The economy of Foshan, in the heart of the Pearl River Delta, has grown more than 16 percent annually on average during the past three decades thanks to its manufacturing sector. Industries in the sector include equipment manufacturing, home appliances, ceramics and construction materials, food and beverages, furniture and textiles.

Equipment manufacturing is already a core industry for the city, with output of 418.3 billion yuan in 2013. The city has 192 key large-scale equipment production facilities with investment totaling 88.5 billion yuan, according to Lu.

"Large projects have laid a solid foundation for the development of the equipment manufacturing industry in Foshan," Lu told China Daily.

Foshan also has 932 foreign-invested equipment manufacturing projects, with combined investment reaching about $11.54 billion.

Under the industrial development plan, intelligent manufacturing, energy conservation and environmental protection equipment, new energy equipment, vehicle manufacturing, marine engineering equipment and industrial services will get priority, Lu said.

The output of the city's equipment manufacturing sector is expected to reach 550 billion yuan by the end of 2016, he said.

"Equipment manufacturers are encouraged to set up technology, research and development and sales centers in Foshan," Lu said.

Zhao Qingchun, chief executive officer of Guangdong Super Focus Laser Inc, said development of advanced equipment manufacturing projects would help upgrade the traditional processing and manufacturing industries in Foshan.

"The city's traditional processing and manufacturing businesses should be upgraded by developing the advanced equipment manufacturing industry," Zhao said.

For example, the company's lasers will help boost production efficiency, according to Zhao.

A growing number of traditional processing and manufacturing companies have introduced advanced equipment such as lasers into their production processes, he said.

Chen Dapeng, general manager of FAW-Volkswagen (Foshan), said that vehicle production will help drive development of other equipment industries such as machine tools and engineering machines in Foshan.

"As one of the key manufacturing bases along the western Pearl River, Foshan will become a major machine tool industrial center in the near future, after a number of big equipment manufacturing projects are launched," Chen said.

The FAW-Volkswagen plant in Foshan has a designed annual production capacity of 300,000 vehicles, according to Chen. Capacity will double after its second phase is completed.

"We believe that research and development facilities for the vehicle machine tool and machinery manufacturing sectors will settle in the city after our capacity increases," Chen said.

The plant has produced 133,000 vehicles since it opened in September 2013, generating output valued at 23.3 billion yuan.