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Chinese firm to build plastic plant in Batam

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by January 7, 2018 General

Batam Free Trade Zone Authority (BP Batam) has granted its first investment permit in 2018 to Chinese plastic maker Hong Sheng Plastic Industry, which is set to invest US$4 million in Batam, Riau Islands.

The company’s president director, Zheng Bo, said the factory would begin to operate no later than the end of March, as Hong Sheng had already secured all the necessary permits.  

“We will produce plastic pellets in Indonesia and then export to China,” he told The Jakarta Post on Friday.

Zheng Bo further said that the company relocated its factory from Vietnam to Batam because of labor issues. Batam was chosen because of its proximity to Singapore, which would ease shipments, he added.

Read also: Indonesia reorganizes Batam Port authorities

The manufacturing facility to be set up in Batam will be able to produce 50,000 tons of plastic pellets annually. It will employ 190 workers, 150 of which will be Indonesians, while the rest will be Chinese.

The number of local workers could be increased, the company said, when they were able to take over jobs handled by their Chinese counterparts.

BP Batam head Ady Soegiharto said Hong Sheng’s move indicated the enduring attractiveness of Batam, which could be reached in an hour by ferry from Singapore, for foreign investors.

“This is a good sign for us in Batam, because it shows that foreign players still see Batam as a promising place to invest,” he said.

Ady added that two other China companies with plans to invest up to $10 million each were applying for business permits from the authority.

The Batam office of the Investment Coordinating Board (BKPM) recorded that Batam welcomed investment totaling $1.1 billion throughout 2017, more than double the $471 million recorded in 2016. (srs/lnd)

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