Nov 21, Colombo: The Board of Investment (BOI) of Sri Lanka signed an agreement with a leading Chinese Tire manufacturer in the world, Shandong Haohua Tire Co. Ltd to set up a project to manufacture tires for the export market.
This significant investment will boost the rubber based manufacturing industry of the country, while creating new path ways to the export markets.
This high profile project has been qualified under the provisions of the “Strategic Development Act” with an envisaged foreign direct investment of US$ 300 million. Exports are expected to commence within 03 years.
Rubber sector is one of the five thrust sectors identified by the BOI’s strategy to drive the FDI to the country. Presently Sri Lanka gains US$ 01 billion worth of export earnings through the Rubber industry, while the present government has set up a target of US$ 02 billion to achieve by the year 2025. Establishment of this project will full fill 30% of the target once operations commence.
Shandong will manufacture semi steel radial tires and all steel radial tires needed for trucks, buses and passenger cars creating job opportunities for nearly 2000 people. The inflows of the skills and the technology to the local youth through this investment will be another unique advantage for the country. Small and medium scale rubber plantation industry employees will be benefited through this new development. The upcoming manufacturing process will create indirect employment, creating new income opportunities to the livelihood in the area as well.
Shandong will be established in 121 acres of land in the industrial park within the Hambantota International Port. The Hambantota International Port Group (HIPG) has offered this land extent to this Chinese giant company as their first -ever foreign direct investment within the Industrial park.
In the 1st phase, the company is targeting an annual production of 9 million tires to be shipped to 45,000 containers.
It’s expected that the Hambantota Port will become more productive with this establishment and thereby generate revenue while achieving the economic goal of the country.
Shandong’s presence in Sri Lanka being a world leader in manufacturing tires to the world shows, the growing attractiveness of Sri Lanka as a destination for investment.
The agreement was signed on behalf of the BOI by Mr. Susantha Ratnayake, Chairman and on behalf of the Company Mr. Cao Mingzhang and Mr. Xu Jiancun from Hambantota International Port Group.
Rohitha Abeygunawardena, Minister of Ports & shipping), D V Chanaka, State Minister of Aviation and Export Zone Development), and Kanaka Herath, State Minister of Company Estate Reforms, Tea and Rubber Estates Related Crops Cultivation and Factories Modernization and Tea and Rubber Export Promotion were also present.
Prime Minister Mahinda Rajapaksa, Minister of Youth and Sports Namal Rajapaksa, Chinese Ambassador to Sri Lanka, Qi Zhenhong and the Chairman from shandong Haohua- from China, Wang Keqiang joined this occasion via online video Conferencing.