Chinese companies reaching out for local expertise in Southeast Asia

Source:Xinhua Published: 2016/8/29 18:13:39

As more and more Chinese companies tap into the burgeoning Southeast Asian market, experts and company officials expect localization to be a key way to boost industrial capacity cooperation between China and members of the Association of Southeast Asian Nations (ASEAN).

The long-time friendly ties and close neighborhood links provide China and ASEAN countries with unique advantages in industrial capacity cooperation, especially under the "Belt and Road" Initiative of the Silk Road economic belt and the 21st century maritime Silk Road.

Lu Jianren from China-ASEAN Research Institute in Guangxi University sees great potential in cooperation between China and ASEAN built on solid foundations.

"In the past, we cooperated in traditional sectors like agriculture, now we are working on areas like infrastructure, industrial parks under the 'Belt and Road' Initiative," he told Xinhua in a recent interview during a seminar in Malaysia.

Some ASEAN countries are lagging behind in infrastructure, where China has advantages in expertise, he said, adding that China has also provided funding support through mechanisms like the Asian Infrastructure Investment Bank and the Silk Road Fund.

China has long advocated win-win cooperation with ASEAN and Chinese companies working overseas are attaching greater importance to bringing benefits to the local communities and industries.

Tang Zhimin, dean of the international college at the Panyapiwat Institute of Management in Thailand, said more considerations should be put into ways in better matching China's industrial advantages with the demand of ASEAN countries.

"Localization is a very important part of industrial capacity cooperation," said Lu.

For the China Railway Rolling Stock Corporation (CRRC), its ASEAN manufacturing hub based in Malaysia is an all-around exploration for the company to expand operation overseas and seek industrial capacity cooperation.

The company has set localization as one of the top priorities.

"We use localization to seek breakthrough in industrial capacity cooperation," said Li Hong, general manager of the CRRC Rolling Stock Center.

One year into full operation at the facility, the effort has already borne fruits. In the 50-acre CRRC Rolling Stock Center in the Malaysian state of Perak, local technicians can be seen working side by side with Chinese counterparts.

"More than 80 percent of our total staff and more than 90 percent of the technicians at the production line are locally recruited, as well as two of its four department chiefs," said Li.

"We also have our eyes on the future by sending some of the staff for further studies in China, fully funded by the company," he told Xinhua. "We hope that they could strengthen our management team in the future," he further added.

On procurement, the company has an office devoted to finding, cultivating and supporting local suppliers, with some 300 ranging from equipment to transportation.

Li said the purpose of the CRRC's ASEAN manufacturing center was not simply sending in Chinese technicians to do the work, but also to boost local economic development and to train local expertise, a common belief shared by more and more Chinese companies working overseas.

The article is a commentary from the Xinhua News Agency.

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