Bike plant deal put together in Luang Namtha

Bike plant deal put together in Luang Namtha

Luang Namtha will see assembly of some 20,000 motorcycles per year once a plant proposed for the province comes on line.

Construction of the assembly plant is set to go ahead after 10 billion kip was committed by a local investor. The plant will produce Chinese motorbikes for brands Fonghong, Daorui, and Jiayu, targeting lower-income consumers in the northern provinces.

An agreement contract for plant construction between provincial Planning and Investment Department Deputy Director Mr Sommay Kosada and SMC Company Limited Director Mr Khamxay Chinda was signed last week.
The signing ceremony was witnessed by provincial Department Director Mr Xayphone Khounsiriheuang.
According to the contract, the plant will be built on three hectares of land in Mai village, Luang Namtha district on R3 Road.

The company has been granted a concession period of 30 years with an option to extend.
Construction of the plant will begin shortly, with completion due in six months.
The company will import parts from China to assemble and sell on the domestic market.
Mr Xayphone said that once complete, the plant will generate income for investors, revenue for the government and job opportunities for local people, helping them to escape poverty.

Success of the factory would help attract more foreign and local investors to invest in the province as well, he said.
He said that in the past there had been a motorcycle assembly factory in the province, but it had been shuttered after the Ministry of Finance adjusted the rate of duty.

The target market for the factory is lower-income people who increasingly use affordable motorbikes to move produce and goods from remote farmlands to urban markets.

This plant will seek to respond to this demand to enable people to raise their incomes without a large outlay.
Mr Xayphone said Luang Namtha province had an open door policy for both foreign and local investors in line with the Investment Promotion Law passed in 2009.

“In addition, we have created a provincial Five-Year Socio-Economic Development Strategy Plan and set up other policies in line with laws to attract greater investment in the province,” Mr Xayphone said.
He said investment in the province fell into two categories.

Investment in the general sector is the responsibility of the provincial Industry and Commerce Department, while investment in government property is the responsibility of the Planning and Investment Department.