The Italy-based Fata Group plans to set up new businesses in China and expand existing ones in engineering, materials, logistics and service sectors.

Ignazio Moncada, chairman and chief executive officer of Fata Group, said the group aims to reach a turnover of 70 million euros (US$84 million) in China this year and increase it by 20 to 25 per cent next year.

It wants to capitalize on the country's rosy economic outlook and big market potential, he said in an interview.

First, Fata Hunter, a subsidiary of Fata Group, will set up a wholly owned company in the engineering sector in China, which will design aluminium, steel and stainless steel processing lines.

Fata Hunter supplies coil coating lines to major steel producers in China, including Baosteel in Shanghai, and is a world leader in the sector.

The new company, which will be located either in Beijing or Shanghai, is expected to be launched in six months and will greatly boost local production and sales, Moncada said.

Second, Fata will increase investments in its aluminium joint venture, Nanjing Fata Tooling Co, whose Chinese partner is Nanjing Yuejin Tooling Co, a subsidiary of Yuejin Motor Group.

The venture, which was set up at the start of the year, mainly produces dies for the foundry sector in the automotive industry.

Fata will gradually move its Asian manufacturing base for such products to China and promote exports to other Asian countries and regions, Moncada said.

Third, the group intends to participate in traffic control and management system integration in some big Chinese cities such as Beijing, which will be hosting the 2008 Olympics and needs to upgrade its system.

Together with several other Italian companies, Fata is involved in a project to improve traffic control and air pollution monitoring in one district of the Chinese capital.

The group is also active in services and training in China. It will establish a joint venture in corporate strategy services with a subsidiary of China General Technology (Group) Holding to meet the diversified needs of both European and Chinese companies.

The venture is expected to start up at the beginning of next year, said Moncada.

Fata has also agreed to provide training and equipment to vocational schools in Southwest China's Sichuan Province. The projects, worth 3 million euros (US$3.6 million), are funded by the Co-operation Unit of the Italian Ministry of Foreign Affairs. Fata is also planning similar projects worth 2 million euros (US$2.4 million) for medical schools in Northwest China's Shaanxi Province.

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