REPORT OF THE ABIA STATE DELEGATION TO THE 1ST NIGERIA GOVERNORS’ FORUM CHINA INVESTMENT SUMMIT, GOUNGZHOU 2017.

by Chinenye Nwaogu

Background
The Governor of Abia State Okezie Ikpeazu PhD, led a delegation of top government officials and some businessmen from Abia State to participate in an investment summit in Guangzhou China under the auspices of the 1St Nigerian Governors’ Forum/China Investment Summit.

The place of China in the global economic landscape can no longer be wished away by any serious minded body. Over the years China has moved from a third world country to emerge as a major political and economic leader among the comity of nations. Today, beyond the massive and state of the arts infrastructural and technological advancement, China has emerged as the world’s production centre for all and any kind of manufactured goods and products. Almost all the leading manufacturing companies in the world today have huge industrial presence in China making the country, the highest exporting country today in the globe.

For any country, state, body etc. keen on economic and industrial growth China provides an opportunity for serious understudying of how China got it right. It was on the basis of aforementioned premise that the Nigerian governors decided that a summit in China will strengthen the quest for economic, industrial and technological growth.

Abia Participation
The Governor arrived China armed with a presentation that spoke to the vision, mission of the state government and efforts of the state government since assumption of office to attract both local and foreign investors through the establishment of institutional and legislative structures that will not just create the enabling environment but also protect the investments of the potential investors. A presentation that elicited applause and genuine interest from participants focused on the leather and garment sectors and the plans of the government to fully automate the sectors, open up to huge private participation and put the state on the global map as a hub for leather and garment. The Governor informed his audience that included top business leaders in Guangzhou province that the state government had already signed a memorandum of understanding with a private company Crown Realtors Ltd to develop a 9 hectre fully serviced free trade zone. He therefore invited Chinese industrialists to take advantage of such huge opportunity.

OPENING OF THE 121ST CANTON FAIR
Part of the activities lined up for the participating governors by the Nigerian Governors’ Forum Secretariat was for the Governors to join officials of the province to declare open the 121st edition of the canton fair. It is pertinent to mention that the canton fair is the biggest exhibition fair globally. Governor Ikpeazu joined other Governors during the opening ceremony and took time out to inspect exhibitions that fell under his area of focus like construction equipments, agriculture, shoe/garment manufacturing equipments etc.

FACTORY VISITS
The delegation prior to arrival had arranged several factory visits based on the areas of focus; leather, garment, ceramics etc. The governor was of the view that the needs and priorities of states differ hence the need for the delegation to break off from the group arrangement and focus on the needs and priority of the state.

HUAJIAN SHOE FACTORY
The Governor led a delegation to the above named shoe factory owned by a major international shoe producer. Huajian Shoe Factory owned by Mr Zhang Huarong operates the biggest shoe factory in Africa based in Ethiopia. This particular factory supplies 2% of the shoe need of the America market. Mr Zhang Huarong informed the Governor that based on the expansion plans of the company; he had already planned to open up another factory worth $1.5B in Africa. He expressed satisfaction that the Governor took time out to visit his factory, being the first Nigerian leader to pay him an official visit.

The Governor in his remarks, extended invitation to Mr Huarong to leverage on the investment opportunity in Abia to invest in the proposed Aba Leather City Project. He informed him that already Aba has a history of shoe production with some of the best designers that could be found anywhere in the world. He further informed his host that the state has plans to support the full automation of the leather and garment to improve quality and service their cliental.

Mr Huarong, informed the Governor that Huajian Group is already expanding its Ethopian operations to include 250 acre industrial city employing over 6000 staff. The Huajian Group currently employs about 20,000 staff in China and operates a 10,000 shoe per day factory in Dogguan valued at $2BN.

He assured the Governor that, he will accept his offer to invest in Abia state and promised to visit Abia before the end of April 2017 to conclude discussions on the project.

ROCMACHINES (SHOE EQUIPMENT MANUFACTURING COMPANY)
As part of the plans of Governor Okezie Ikpeazu to fully automate the leather value chain, the delegation visited ROCMACHINES an equipment manufacturing company. The company produces world-class shoe manufacturing equipments used by the major shoe manufacturers in China and beyond. As part of the detailed factory inspection, the Chief Operating Officer of the Company Mr Wen led the delegation to ST & SAT Shoe Manufacturing Company in Shenzyn China to observe the full operations of the equipments.

The Governor expressed satisfaction with the quality of the company’s products and assured his hosts that the state government will immediately identify the key equipments needed by the operators of the leather industry in Aba.

CRW CERAMICS COMPANY LTD
The Governor and his team set out for the Ceramics Industrial Cluster at Foshan City, Guangdong Province to undertake a tour of ceramics manufacturing companies in the area. The Governor visited showrooms and factories of major ceramics manufacturers in the area. He eventually held a meeting with them and secured their commitment to come and revitalize the Umuahia Ceramics Company and where impracticable, set up their own ceramics factory in Abia State. He assured them of the availability of Kaolin, Silica Sand, Tar Sand, Clay and other raw materials for ceramics manufacturing in large quantities in Abia State as well as favourable investment policies. The consortium will be led by Mr. Xi Ghao of CRW Bathrooms, an international company with presence in 180 locations around the world. The CRW Ceramics Company Ltd runs a major ceramic factory in Guandong China valued at over $5BN occupying a land area of over 9000 sqm.

MEETING WITH MR. XIO SHAO

At 7pm on Sunday April 16, 2017 Governor Ikpeazu proceeded to a dinner meeting with the Nigeria-China Business Council led by the Director-General, Mr. Xie Shao. At the meeting, the Chinese delegation included officials of Power China, the Chinese Government Power Company as well as representatives of Agricultural and Infrastructural Development Companies. The Governor, in the course of the meeting, highlighted the investment potentials in all sectors of Abia State and assured the Council of returns on their investments. Members of the Council agreed to visit Abia State on a date to be agreed to further the discussions. Mr. Xi Shao owns the Skyrun Electrical component Manufacturing Factory at Aboh Mbaise, Imo State and disclosed that he has always had interest in investing in Abia State and thanked the Governor for the opportunity. Skyrun has a multimillion dollar investment at Calabar Free Trade Zone (Skyrun Electrical Appliances Company) and a cocoa industry in Oshogbo, Osun State.

Visit to the Hawtai Motor Manufacturing Company
On April 19th 2017 the team departed Guangzhou to Beijing China to honour an invitation from the President of Eastern Vehicle Assembling Limited Mr Joseph Okechukwu to inspect the massive factory of their joint venture partner, Hawtai Motor Manufacturing Company in Taijin China about 3 hours drive from Beijing.

The fully automated factory which seats on a land area of about 10 hectre employs over 4000 employees and produces 700 cars daily. The company manufactures all brands of cars including Sedan, Pick Up, SUV etc. their cars are made of 100% steel body, fitted with anti corrosive equipments and 5 years warranty. The management of the company took the Governor and his team round the entire complex made up of four different segments of car manufacturing.

The essence of the visit was to fully activate the deal between Abia State Government and Eastern Vehicle Assembling Limited (EVAL) contracted in late 2016. It is proposed that EVAL will establish an assembling plant in two phases first for Semi-Knocked-Down (SKD) vehicles; second phase will be for Completely-Knocked-Down Vehicles (CKD). After this phase the company will begin full manufacturing of cars in Abia State. Prior to this the company will in the next 3 months open a full 4 S (Sales, Spare Parts, Systems and Servicing) show room at Osisioma area of Abia State. As part of the deal, the company will train about 5 youths in their parent company in China for 7 weeks. The entire package will see Abia benefitting from an investment in excess of $1BN. In other enhance local content, the company will source about 30% of parts including leather, fluids, lubricants and other materials that can be fabricated in Abia State. The company will have 80% of her employees as indigenes of the state.

SUMMARY
The Governor and his team were of the view after extensive review that the trip was a great opportunity to market the state’s potentials and opportunities to a global audience, which will in turn attract investment in excess of $3BN to the state. All engagements in China were in tandem with the state’s economic development plan. The Governor before departing China had designed a framework for the implementation of all the decisions and plans and directed that all the relevant persons and MDAs whose roles will be beneficial to the achievement of the set objectives should be properly briefed to ensure maximum results.

Some of the investors immediately indicated interest to deepen the discussion with a visit to the state starting from the last week in April. The investment opportunities identified has the capacity to trigger activities in other sectors of the economy like tourism, housing, transportation, logistics and services.