Dominant state-owned petrochemical producer Shanghai Tianyuan Group has begun construction on a factory to produce polyvinyl chloride (PVC) to sell to multinationals in China.
A spokeswoman for the group said work on the first phase of the plant, involving an investment of 1.8 billion yuan, was due to be completed by the end of next year. Production would begin in the first half of 2006, with an annual output of 300,000 tonnes.
The plant will be located in the Shanghai Chemical Industry Park, in the coastal town of Caojing.
'Our main customers will be foreign companies in China, like BASF,' the spokeswoman said. 'The Shanghai chemical park is becoming a large integrated network, with domestic and foreign companies providing both upstream and downstream products.'
China is a major importer of PVC, with demand outstripping supply because it is used in a wide range of sectors, including agriculture, industry, construction and electronics.Official figures show China's output of PVC last year reached 4.1 million tonnes.