By Lillian Liu (China Daily)
Updated: 2007-08-13 06:55

The mainland may be trying to do away with labor-intensive and high-energy consuming industries but some Southeast Asian and Latin American countries are welcoming them with open arms. China's second largest paper maker is one of the firms that has responded to such an invitation.

Hong Kong-listed Lee & Man Paper Manufacturing plans to invest HK$1.6 billion in Vietnam to set up a paper mill, a paper-pulp factory and a power plant. It plans to start production as early as October this year.

"Our capital expenditure is HK$6.6 billion ($844 million), and we plan to inject HK$1.6 billion in Vietnam because of that country's favorable investment policy and great development potential," CEO Raymond Lee told reporters in Ho Chi Minh City on August 5.

The power plant will generate 150 megawatt (MW) in the first phase, but "the long-term target is to build a 600-MW plant". Lee & Man decided to move to Vietnam after the mainland government announced further curbs on high energy and resource consuming units.

The Vietnamese government, however, has been rolling out the red carpet for foreign investors, and those who build factories in the country are given a 50-year land lease. A rent holiday for 15 years comes as a bonus, Lee said.

"Vietnam's economy will achieve rapid growth in the next 15 to 20 years," said Lee. "The country is rich in natural resources, which is good news for us." And many firms see the backward facilities and lack of modern infrastructure in that country as a great opportunity for investment.

(China Daily 08/13/2007 page3)