CHINESE firms HBIS Group Co., Ltd. and Huili Investment Fund Management Co., Ltd have partnered with Steel Asia Manufacturing Corp. to develop the $4.4-billion Philippine Iron and Steel Project in Misamis Oriental, which will be China’s largest industrial investment in the country so far.
The Department of Trade and Industry (DTI) said in a statement on Friday that the HBIS Group and Huili Fund signed a memorandum of understanding with Steel Asia and PHIVIDEC Industrial Authority for the integrated steel complex project.
HBIS Group is a state-owned company based in China’s Hebei province that produces appliance grade and automotive grade steel products. It is described as the second largest steelmaker in China and the third largest in the world.
Meanwhile, Huili Fund is a private equity firm headquartered in Beijing that invests in real estate, finance, and industries. The company signed a letter of intent with the Board of Investments (BOI) in 2017, signifying its willingness to partner with the Philippines and private sector entities.
Steel Asia is the local partner for the project. The company is currently expanding its services for more efficient production and to boost capacity.
The project will stand on a 305-hectare property inside the PHIVIDEC Industrial estate. This will allow the country to produce basic iron and steel products that can be further manufactured into metal sheets and bards, nails, staple wires, paper clips, and construction-grade products such as wire rod and wire mesh.
Imports of iron and steel were valued at $4.91 billion from January to October, making it the country’s fifth import by commodity group.
“This project is very important to our industrial development and will allow us pursue President Duterte’s vision of having a globally competitive integrated iron and steel industry, to support the growing economy, to alleviate poverty, and to create jobs for every Filipino,” Trade Secretary Ramon M. Lopez said in a statement.
The project will be developed in two phases, with the first phase to cost $3 billion, covering the production of 4.5 million tons of hot rolled coil (HRC) and 600,000 tons of slabs. The second phase will further increase the project’s steel manufacturing capacity to 8 million metric tons.
DTI expects the project to provide up to 65,000 in indirect job opportunities from the project.
“Boosting the manufacturing sector creates jobs and increases the production capacity to support the growing domestic demand and export requirements,” Mr. Lopez said.
The project is also seen to reduce the country’s trade deficit, since it will allow the country to generate up to P144.279 billion from total domestic and export sales of slabs and HRCs, according to the BOI.
“With this integrated steelmaking facility, the country will be able to capture, through this and succeeding phases of the project, large part of the value for the manufacture and assembly of appliances, automotive assembly, construction materials, shipbuilding, heavy equipment manufacturing, among others,” BOI Managing Head Ceferino Rodolfo said in a statement. — Arra B. Francia

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