BorsodChem Zrt, Hungarian subsidiary of the Chinese Wanhua Industrial Group, is to build a new plant for hydrochloric acid conversion in Kazincbarcika with government support. The investment of EUR 84 million will create at least 70 new jobs, announced Péter Szijjártó, State Secretary of the Ministry of Foreign Affairs and Trade and Jiansheng Ding, chairman and CEO of BorsodChem on Monday in Budapest.

Péter Szijjártó emphasized in his address: the ever more dynamically increasing Chinese investments significantly contributed to Hungary’s evolution into the production centre of Europe, while Chinese companies consider Hungary as a regional production logistics centre. The State Secretary pointed out that the Hungarian government will grant a support of HUF 996.6 million for the investment, whereby the number of BorsodChem employees will exceed 2,500 people.

DownloadPhoto: Gergely Botár

Jiansheng Ding emphasized that Borsodchem, supported by both the Hungarian and Chinese governments, has been continuously developing, there are plans to further increase their capacities and they strive to encourage other Chinese investors to invest in Hungary.

Péter Szijjártó said that Wanhua is committed to increasing their Hungarian production and expanding their activities, and this is an investment where a company with operations in Hungary reinvests capital. The State Secretary explained that the construction of the new hydrochloric acid condensation plant will facilitate the accomplishment of Hungarian strategic objectives in foreign trade from three aspects.

He reminded that the government announced the policy of opening to the East in 2010, and evolving Hungary into the regional centre of European business expansion for Chinese companies – a kind of gate to Europe for Chinese entrepreneurs –, and the continuous expansion of Hungarian exports were also among the government’s objectives. Hungary can make progress in all three areas due to the investment by Wanhua, said Péter Szijjártó.

The Hungarian activities of Wanhua are the “flagship” of Chinese investments in Hungary, explained the State Secretary, reminding that when Wanhua decided to invest in Borsodchem in 2011, then it was the largest Chinese investment of the year in Europe.

Péter Szijjártó pointed out that Borsodchem with its 2,500 employees has become one of the largest employers in the region of Northern Hungary, and is a regional leader in three segments of the chemical industry in Central Europe. Their products are used by industries that are extremely important for the Hungarian economy, e.g. the automotive industry, electronics, and the building industry, he added.

DownloadPhoto: Gergely Botár

The State Secretary emphasized that this investment of EUR 84 million will enable Borsodchem to fully utilize its available isocyanate production capacity, and at the same time the company will change over to a more environmentally friendly operation.

The investment substantially strengthens the Hungarian economy, because about 4/5 of the production of Borsodchem is sold abroad, so we can reasonably expect that the expansion of production will be accompanied by the further growth of Hungarian exports, and also that Borsodchem will reinforce its positions in the regional competition. Moreover, the construction of the new plant will demonstrate to other Chinese companies that Hungary is a good target for investment, said Péter Szijjártó.

The investment by Wanhua perfectly fits into the development of the Hungarian-Chinese economic relations; last year Hungary set an all-time record for its exports to China, and the value of Chinese working capital amounts to about EUR 3 billion in Hungary, explained the State Secretary.

Jiansheng Ding – who also serves as CEO of the Wanhua Industrial Group – emphasized in his speech: Wanhua is the third largest isocyanate manufacturer in the world; they work together with Borsodchem in order to achieve their common goals, and they would like to increase their Hungarian capacities.

He was of the opinion that the efforts of China and Hungary resulted in this "high-level, active cooperation”, which has a great future.

Jiansheng Ding emphasized: he believes that, with the support of the Hungarian government, the Wanhua Group and Borsodchem may become a kind of flagship in giving boost to Hungarian-Chinese relationships.