China's leading profile manufacturer, Conch Profiles and Science Co. Ltd., is investing in a new plant in China's far northwestern frontier region Xinjiang, as part of the government's border region assistance program.
Publicly traded Conch announced that it's forking over 60 million yuan ($89 million), including equipment and cash investment, to build a facility that can produce 20,000 metric tons of plastic profiles annually.
The project is to fulfill a large corporation's social and political responsibilities, Conch said. The local government in Hetian, Xinjiang, has pledged incentives for the company's operation there. The region borders Central Asia states as well as Afghanistan, Pakistan, Russia, and Mongolia, all far from China's traditional plastics manufacturing areas.
The new site will leverage the competitive costs in the area and enhance Conch's logistical efficiency, the company added.
As a warning to investors, Conch noted the possibility of production halts due to potential social instability in the ethnically divided region, which has suffered from terrorist attacks.
The company also recently agreed to a similar investment deal in China's rustbelt region in the northeast, in response to Beijing's call to help revive the area.