China : Hongdou Garment to set up production base in Cambodia

February 5, 2007

Managing Director Wang Zhu Qian, Hongdou Group, revealed on January 30 that the board of directors had approved the plan of investing about 300 million yuan to build a factory in Cambodia after Chinese Spring Festival. All of its products will be exported to different market.

It is reported that this strategy is an attempt to avoid the textile restrictions imposed by the US and EU, because Cambodia dose not face such restrictions. In addition, China’s land, water, manual labor costs have continued to rise, while Cambodia and other countries have certain advantages in these areas.

Earlier, the company established its own factory in Wuxi Industrial Park. They also spent more than one year to make investigations in Cambodia and Vietnam. Cambodian local government warmly welcomed the Group to establish factory in their place. Group achieved annual sales of 14.3 billion yuan in 2006, of which 10 million came from exports.

Europe and the US markets accounted for 70 percent of the group’s total exports. It is revealed that the group exported over US $60 million of textile products in 2005. And the export amount surpassed $100 million in 2006.