Chinese firm to put up steel plant in Mindanao

A Chinese steel company will invest $3.5 billion in Mindanao to set up an integrated steel manufacturing plant, the Department of Trade and Industry (DTI) said.

Trade and Industry Secretary Ramon Lopez said Chinese steel company Panhua Group Co. Ltd. (Panhua) would develop a 305-hectare integrated steel manufacturing plant in an economic zone in Northern Mindanao.

The investment will be used to put up a port, an integrated steel mill with a capacity of 10 million tons, an industrial park and other downstream industries, DTI said in a statement.

The three-phase project is expected to be completed in six to seven years and generate 50,000 jobs. It will be located at the Phividec Industrial Estate of the Misamis Oriental Special Economic Zone.

Top officials from both China and the Philippines signed a memorandum of understanding (MOU) for the project on the sidelines of Chinese President Xi Jinping’s visit to the country.

This develops as President Duterte moves to win the favor of China, even though his efforts to further court the economic powerhouse come at the risk of weakening the Philippines’ territorial claim in the South China Sea.

“The signing of this MOU is a testament to the strengthened relations between the Philippines and China,” Lopez said.

He said the project would accomplish Mr. Duterte’s vision of growing the iron and steel industry so it could cater “to the growing domestic and external market demand.”

DTI, through its attached agency the Philippine Economic Zone Authority (Peza), said it was committed to assist Panhua in the next steps so it could “immediately set up the steel plant early next year.”

DTI said the MOU was signed by Lopez, Panhua chair Xinghua Li, Phividec Industrial Authority CEO and administrator Franklin Quijano and Peza Deputy Director General Tereso Panga.