Chinese private firms embed themselves in Southeast Asia

When Chen Deyun arrived on a remote Indonesian island a decade ago, stable electricity and phone signals were hard to come by. Today, he starts his mornings in an industrial complex of furnaces, docks and dormitories built by China's Zhenshi Holding Group.

Chen, now a senior manager at one of the park's operating companies, has spent nearly 10 years working in Indonesia.

The Indonesia Huabao Industrial Park in Morowali, Central Sulawesi province, has become a focal point of Zhenshi's overseas expansion and a case study in how Chinese private manufacturers are embedding themselves in Southeast Asia through jobs, training and infrastructure investment.

Zhenshi's overseas push mirrors the broader rise of China's private sector in foreign trade.

According to the General Administration of Customs, China now has more than 780,000 business entities with import and export records, with private enterprises continuing to serve as the main engine of foreign trade. In 2025, private firms recorded total imports and exports of 26.04 trillion yuan ($3.73 trillion), up 7.1 percent year-on-year, accounting for 57.3 percent of the country's total trade value.

Zhenshi, founded in 1969 as a textile factory in eastern China's Zhejiang province, has grown into a diversified industrial group spanning special steel, nickel-iron manufacturing, wind power materials and new composite materials. In 2025, it ranked 191st on China's list of the top 500 private enterprises, rising 12 places from a year earlier and marking its 13th consecutive year on the list.

Indonesia has emerged as a core pillar of that growth. In 2022, Zhenshi began developing Huabao, its first overseas self-built industrial park, as part of a strategy to integrate nickel resources into its broader materials supply chain.

Nickel-iron smelting projects anchor the park, supplying downstream industries such as stainless steel and new energy materials. Around them, Zhenshi has built power facilities, roads, housing, logistics systems and port infrastructure, turning what was once largely undeveloped land into a functioning industrial hub.

Local employment has been central to the project. Indonesian workers account for 91.45 percent of Huabao's on-site workforce, or 2,555 people. Including affiliated projects, local employees total 8,217, representing 84.47 percent of staff members across operations, according to park data.

Indonesian workers now fill roles across production, equipment maintenance, logistics and support services, forming the backbone of daily operations.

Since 2022, Huabao has expanded training programs to support workforce development, including vocational skills, leadership, digital training and Mandarin-language courses tailored to workplace needs. In 2025, the park delivered more than 72,000 training hours, averaging nearly 25 hours per employee.

More than 800 local youths have taken part in over 25 skills training sessions, while free courses in areas such as driving and welding have helped nearly 900 trainees secure jobs. In recognition of these efforts, Morowali's local government awarded Huabao a certificate in 2025 for contributions to employment and human resource development.

Zhenshi's investments have also supported broader industrial development. Nickel-iron operations have stimulated demand for local suppliers in raw materials, logistics and equipment services. An upcoming coconut-based integrated processing project is expected to extend agricultural value chains from raw material sourcing to processing and exports.

Infrastructure investment has gone beyond the park itself. Huabao has invested about $10 million to expand Morowali's airport, improving regional transport capacity and supporting the area's growing industrial activity.

The park has developed 308 suppliers, including 132 Indonesian firms, helping local companies improve quality, safety and production standards through unified procurement and inspection systems. In agriculture, nearby villages now supply more than 94 percent of the park's vegetable purchases, creating a stable income source for surrounding communities.

Since 2022, Huabao has carried out more than 100 social responsibility projects covering infrastructure, education, healthcare, environmental protection and community support. These initiatives earned the park special recognition from Indonesian business associations in 2025.

Zhou Mi, a senior researcher at the Chinese Academy of International Trade and Economic Cooperation, said such projects reflect a broader shift in China's overseas investment approach.

"Chinese manufacturing investment is moving up the value chain,"Zhou said. "Beyond labor, companies are helping improve technical and management capabilities, generating clear spillover effects that support industrial upgrading in host countries."

Southeast Asia has become a priority destination for Chinese firms seeking to diversify supply chains and markets. Analysts from China Galaxy Securities said that large-scale overseas investments by Chinese companies have increasingly been directed to the Association of Southeast Asian Nations in recent years, with Indonesia, Singapore and Malaysia emerging as the main destinations.

Industry data show that more than 6,500 Chinese companies have invested directly in ASEAN, with most planning to expand further. Indonesia, with its large market and rich nickel reserves, has drawn particular interest as it promotes electric vehicle and materials industries.

Cooperation between China and ASEAN is becoming more institutionalized. China and ASEAN have been each other's largest trading partners for five consecutive years, with bilateral economic and trade relations continuing to deepen. The China-ASEAN Free Trade Area 3.0 Upgrade Protocol further underscores China's commitment to deepening regional integration and sustainable development.

For Zhenshi, the experience in Indonesia has reshaped its overseas model from stand-alone projects to integrated industrial platforms.

"An industrial park is not just about production," a senior executive based in Indonesia said. "It is about long-term development alongside the local economy."

As operations expand in Morowali, Huabao underscores how Chinese private enterprises are positioning themselves as long-term participants in regional growth.