Chinese LED lighting maker enters into Polish market

The view of the Hongbo Clean Energy (Europe) in Opole, Poland. [Photo: China Plus]

Chinese-owned LED manufacturer Hongbo Clean Energy, the first Chinese greenfield investment project in Poland, is being held up as a prime example of how the Belt and Road Initative is helping Chinese firms expand around the world.

Hongbo Clean Energy is expanding its European operations by building a new high-tech complex in Opole, in Poland's southwest.

A framework agreement was first signed at the Silk Road Forum and Poland-China Regional Cooperation& Business Forum in 2016.

Under the plan, phase one of construction work on the new plant was completed in August last year. 

Since then, the production center, R&D center and warehouse have been put into use.

Phase two in the construction, mainly for hardware and surface treatment, is entering the final stage of its environmental approvals.

It is expected to be operational sometime in the second half of next year. 

Lin Fazhen, general director of Hongbo Clean Energy in Europe, says despite a huge market potential in Europe, they did knock up against difficulties in attempt to enter the market. 

"It's been tricky for us to tap into market in Europe. It's hard to open up the European market at home due to plenty of provisions in the European Union. So we establish a new plant in Europe in order to streamline our sale process. Products made in Poland and China both are orientated to the European market. " says Lin Fazhen.

Aiming for automated production, Hongbo mainly uses Chinese designs, with local devices serving as a supplement.

However, most domestically-produced automation devices aren't certified to enter the European Union from China.

Adrian Ałasa is with Hongbo Clean Energy in Europe.

"Our biggest challenge is to import devices from China. First of all, we have to spend a lot of time determining whether these devices are qualified to be imported. Some production equipment we really need can only be produced in China." says Adrian Ałasa.

The plant, located in the Opole special economic zone, enjoys preferential tax treatments provided by the Polish local government. 

Hongbo has invested about 100 million US dollars in Opole, creating more than 100 new jobs.

Arkadiusz Wiśniewski, Mayor of Opole, says the city would like to attract more business from China in the future.

"Opole special economic zones offer hefty tax concessions. In addition, we provide a strong tax cut in real estate. Other regions in Poland generally give 3 to 5 years of preferential period, while in Opole, we give 10 years. Moreover, Bureau of Labor in Opole gives subsidies to new employment of enterprises in special economic zones. Opole Autonomous Government also gives its full supports to foreign-invested enterprises in administrative approval and licensing.".

The trade between China and Poland reached 21 billion dollars last year, up 20 percent year on year.