Bonded zone in Horgos attracts foreign companies

A major market town on the ancient Silk Road, Horgos, has become a dynamic border city in China's western Xinjiang Uygur autonomous region, with flourishing foreign trade, as an increasing number of enterprises have been attracted to invest in the young city following the establishment of a comprehensive bonded zone.

The zone is a specially designated area under the supervision of China's customs, which enjoys favorable taxation policies.

A total of 497 enterprises have registered in the zone since it was established in 2020, ranging from cross-border e-commerce and international logistics to processing and commodity trading, said Zhu Hong, deputy director of the zone's management committee.

Russian food processing company Golden Katyusha is the first foreign enterprise to settle in the zone. Since 2017, the company has been importing green and pristine wheat flour and pure black rapeseed oil from Novosibirsk and processing the materials into food products, including noodles, edible oils, and cookies.

Russian wheat flour and rapeseed oil are cheaper, with higher output, and are known for excellent quality and being green and natural, which is a compelling choice for Chinese consumers, said Iurii Basargin, executive of the company.

The short distance between Novosibirsk and Horgos and efficient customs clearance procedures enable those materials to arrive at the zone within two days, and with a preferential taxation policy, Basargin is confident about doing business in the border city.

The company imports nearly 500 tons of wheat and 100 tons of rapeseed oil every month, he said, and the noodle processing factory has an annual production capacity of 36,000 tons.

After a three year-suspension because of the COVID-19 pandemic, the noodle processing factory reopened in September, and has already received orders totaling around 300 tons, from cities such as Chongqing and Chengdu in Southwest China.

Basargin said he found the Chinese market appealing and promising. "We are exploring the market step by step," he added.

In 2022, the total import and export value of the zone reached 23.39 billion yuan ($3.21 billion), and from January to October this year, the trade value has already reached 33.43 billion yuan, marking a year-on-year growth of over 70 percent, said deputy director Zhu.

The zone is fully exploiting the advantages of Horgos as a border port and strives to make it an open industry demonstration zone along the border, he added.