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Foreign equipment makers may reap stimulus bonanza

By Zhang Yu'an (China Daily)
Updated: 2009-02-28 08:14

Foreign equipment makers are expected to cash in on the demand for high-end machine tools in industries like automobiles and shipbuilding as a result of the recently announced 4-trillion yuan ($586 billion) stimulus package, according to officials from the China Machine Tool and Tool Builders' Association.

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The country's vigorous development of the aerospace and aviation, clean energy, oil and gas exploration and transmission, agricultural machinery, engineering machinery, and high-speed railway sectors will also generate the need for import of more high-grade machine tools.

"Along with the implementation of the stimulus package, the launch of the country's key science and technology projects and domestic market expansion, the demand for high-end machine tools will certainly continue to increase," Wang Liming, vice-president of the association, said at a news briefing on the 11th China International Machine Tool Show to be staged in April in Beijing.

According to the association, total floor space at the forthcoming exhibition will touch 100,000 sq m, an increase of nearly 39 percent over previous year. More than 50 percent of the space would be occupied by 550 overseas machine tool companies.

"Most of the leading machine tool companies have decided to focus on China as the first destination for business expansion this year and in the coming years," said Wu Bailin, president of the association.

China is the world's largest machine tool consumer and importer over the last seven years, he said. In 2008, China's share of machine tool consumption accounted for about one quarter of the world's total.

Statistics from the association show that the country imported $12.29 billion worth of machine tools last year. Domestic output value of the industry reached 347.23 billion yuan.

Yu Chengting, executive vice-chairman of the association, said the country's machine tool companies would continue to actively pursue overseas acquisition opportunities.

In the past few years, eight Chinese machine tool companies have acquired 11 foreign machine tool manufacturers including those in the United States and Germany.

"All the acquired companies are operating well," he said.