China to build a USD3.8 billion industrial park in Papua New Guinea

China has agreed to spend nearly USD4 billion to build a giant industrial park in the jungle of Papua New Guinea.

A memorandum of understanding was signed by investors from Shenzhen, China’s third largest city, to build a series of processing and manufacturing plants at two industrial parks in West Sepia province, a dense jungle region 30 kms (20 miles) from the Indonesian border, said Patrick Pruaitch, Minister for Treasury of Papua New Guinea.

According to Pruaitch, one park was for large-scale processing of timber products, fisheries, cassava and tropical spices with an adjacent park tailored to Shenzhen-based companies that want to produce steel, cement and other industrial products, according to Pruaitch.

The projects are to be developed in phases at a final cost of USD3.8 billion.

A spokesman for the treasurer said the government hoped to see construction starting next year, but the plans at this stage were “very long term.”

Metallurgical Corporation of China, which built a USD2 billion nickel mine in Papua New Guinea in 2012, is expected to be the main construction contractor.

The spokesman said the projects were a part of China’s “One Belt, One Road policy, even though the initiative is aimed at connecting Asia to Europe and Africa via a 21st Century version of the ancient Silk Road east-west trade route that didn’t include the South Pacific.

Another agreement between Papua New Guinea and business interests from Fujian Province, which is also looking at major investments, including the idea of starting a “furniture city” in the country, is close to being signed, the spokesman added.

Source: Reuters