Investment Promotion Project of Beef Cattle Industry Cluster in Dehong Area of China (Yunnan) Pilot Free Trade Zone

Name

中国（云南）自由贸易试验区德宏片区肉牛产业集群招商项目

Investment Promotion Project of Beef Cattle Industry Cluster in Dehong Area of China (Yunnan) Pilot Free Trade Zone

Industry Involved

Food and consumer goods manufacturing

Site

Ruili Border Economic Cooperation Zone (Nongdao Town)

Project Description

Ruili Nongdao Town is adjacent to Myanmar on three sides, and has four passages: Wanding, Mangman, Jiegao and Nongdao. The Nongdao Passage is a beef cattle passage designated by the four ministries and commissions of China, giving full play to the border advantages. At present, Ruili Penghe Agricultural Food Development Co., Ltd. has put into production the slaughter project of 500,000 beef cattle in Nongdao Town. The slaughtered beef cattle are Myanmar Brahman cattle from cross-border isolation farm, which are tropical grazing ecological cattle. Brahman beef has low fat content and high quality protein content, which is popular among the people. This project, taking cattle slaughter by-products as raw materials, is to develop intensive-processing products of beef, cattle bones, cattle blood, cattle viscera, tallow and biomedicine by introducing powerful investors, thus extending the beef industrial chain in Ruili City.

Content

Construction scale: The contents of supporting construction include R&D center, quality inspection center, sales exhibition center, e-commerce center and basic supporting facilities. After the target output is reached, the project will realize annual tallow refining volume of 8,000 tons, bone protein of 3,750 tons, bone oil of 1,875 tons, bone charcoal of 10,000 tons, cooked beef cattle food of 15,000 tons, and various beef offal deep-processed products of 15,000 tons, and biochemical products of 500 tons produced annually by extracting collagen and hemoglobin from cattle blood, thus extending the beef industrial chain of Ruili City.

Construction period: 3 years.

Supporting Conditions

1. Ruili is 445km from Mandalay, 670km from Naypyidaw, 1,138km from Yangon and 866km from Kyaukpyu. It is 116 km from Ruili Nongdao to Bhamo, Myanmar. The product from Ruili, after a journey of about 1,000km via Lashio and Mandalay, can be directly exported to such ports as Yangon Port and Kyaukpyu without passing through the Strait of Malacca, thus entering the Indian Ocean. 2. The park guarantees the timeliness and safety of electricity, water and road use of the project. Generally, the industrial electricity price is CNY 0.47/kWh, the industrial water price is CNY 2.65/ton, and the industrial gas price is CNY 2.59/m3. Labor force: According to DRSF [2013] No.69 document, it belongs to the second category (CNY 1,130). It, enjoying the advantage of special border port, is adjacent to Muse and other cities in Myanmar where labor resources are abundant with low prices. 3. The land index required for the construction of the project can be implemented, and the implementation of the project will not have obvious impact on the environment. The raw materials of the project are mainly purchased from surrounding cities.

Investment Estimate and Fund Raising

Total investment: CNY 490 million

Fund raising: self-raising by enterprise, and bank loans

Preferential Policies Applicable

National and provincial preferential policies: Opinions of the Central Committee of the Communist Party of China and the State Council on Deeply Implementing the Western Development Strategy; Policies of the People's Government of Yunnan Province on Accelerating the Construction of Ruili National Key Development and Opening-up Experimental Zone; Notice of Ruili City People's Government on Printing and Distributing Preferential Policies for Investment Promotion in Ruili City. The project, after meeting the relevant standards of documents, can enjoy the policies such as: "One Discussion over Each Matter"; in terms of tax, “five-year free and five-year half” (i.e., "from the profit-making year, the enterprise income tax will be exemptible for the next first five years and half rate reduction for the next subsequent five years."), "three-year free and two-year half" (i.e., from the profit-making year, the enterprise income tax will be exemptible for the next first three years and half rate reduction for the next subsequent two years.), and deduction from personal income tax for senior executives; fund subsidy for standard workshop construction.

Market Prediction (Analysis)

China still relies on imports to make up for the huge domestic demand for meat, and there is much room for growth in beef production; China's per capita consumption of beef cattle is only half of the world average, but the overall market demand is large, creating a broad market space.

Profit Model and Preliminary Benefit Analysis

Generate revenue through product sales and patent authorization

Risk Analysis

Key points: The project may face certain risks in terms of policy, construction, market, interest rate (exchange rate), and operation, so reasonable preventive measures should be formulated.

Cooperation Pattern

Joint venture, cooperation, equity participation, PPP, etc.

Contact Information

Contact Unit: Ruili Border Economic Cooperation Zone (Nongdao Town)

Contact Person: Yang Qingyu

Tel.: 18387519171

Fax: 0692 -3037409