Wacker sees opportunities in opening-up

German chemical company plans continued investment in R&D, production capabilities

Wacker Group, the Germany-based chemical company, will continue to invest in research and development and production capabilities in China, as the company's fortunes are buoyed by the country's upcoming new round of opening-up measures, said its top executive.

China is the company's largest global market, and Wacker has its sights set on further growth, and on enhancing its local R&D capabilities and downstream capacities, said Paul Lindblad, president of Wacker's arm in China.

By the end of this year, Wacker's ongoing expansion of its silicone R&D lab and the installation of a new food application lab are both due for completion in China, Lindblad said.

To support local and global customers in the field of electric vehicles, Wacker is also establishing an e-mobility competence center in Shanghai, which includes an R&D lab and a project team.

"In the next five years, the EV industry will witness at least two-digit growth in China, as well as in Europe," he said.

Dong Kan, Wacker's market manager for silicone industry solutions, said the EV sector not only brings disruptive transformation for the automobile industry, but also generates demand for silicone products with better performance.

Wacker's ambitious plans have been encouraged by China's pledge to further open up, Lindblad said.

"Given China's strong support for trade, its increased efforts to protect intellectual property rights and the more attractive investment environment, we are confident that Wacker will continue investing in local R&D and production capabilities, growing together with China as the country enters its new era."

Wacker has invested more than 600,000 euros ($719,880) in facilities in Zhangjiagang, Jiangsu province, to accelerate silicone innovation and to optimize production processes. The new pilot facilities will start operation in the second half of 2018.

Last year, the company's sales in China climbed about 10 percent year-on-year to 1.2 billion euros, which accounted for almost a quarter of its global total, according to its annual report.

"2017 was another very successful year for Wacker in China. Living standards in China continue to improve, which is boosting demand for the high-quality products we supply," Lindblad said.

"Moreover, we are also benefiting from China's determined efforts to protect the environment and develop sustainably. Rising living standards and the ongoing transformation of industry will fuel Wacker's further growth in China in 2018."

Huang Yong, director of the International Cooperation Center of the National Development and Reform Commission, said in an article that China will continue to open up and facilitate free trade and investment, as creating a stable, fair and transparent business environment is one of the country's priorities to attract foreign investment.