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Companies

South Korean company to build ginseng plant in northeast China

(Xinhua)
Updated: 2011-03-25 09:59
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CHANGCHUN - KT&G, South Korea's largest tobacco and ginseng company, will build a plant in northeast China's Jilin province to tap into the world's largest market for the root.

The company signed a cooperative treaty with the Jilin provincial government in Changchun city, the capital of the province, on Wednesday, as it vowed to build a ginseng processing plant solely funded by KT&G in Yanbian Korean Autonomous Prefecture.

With an investment of 800 million yuan ($121.91 million), the plant is expected to process 2000 tons of ginseng annually, with an annual output value of one billion yuan.

Additionally, the company has decided to bring in advanced ginseng processing and planting technologies to China and to develop a series of ginseng products at the plant.

According to the treaty, Jilin province will support KT&G with preferential policies as enjoyed by local Chinese ginseng companies.

Dubbed as the "king of herbs," ginseng is considered to have great nutritious and medical value in Chinese medicine. The Changbai Mountain in northeast China has a 450-year history of cultivating ginseng.

Considered the largest ginseng production base in the world, Changbai Mountain's ginseng production accounts for 86 percent of China's production and 70 percent of the world's total output.

Jilin province is expecting to see ten-fold growth in its output value of ginseng in ten years from the present 10 billion yuan to 100 billion yuan in 2020, according to the local government.

Chen Weigen, vice governor of Jilin province said Jilin province has been cooperating with KT&G in the ginseng industry during the past two years which has laid a solid foundation for the construction of the plant.

Min Young Zin, president of KT&G, said, the company will help Jilin province to develop its ginseng industry with its skills and experience in ginseng production.

Related readings:
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South Korean company to build ginseng plant in northeast China Tongrentang Health to source ginseng from Wisconsin

Zhang Hui, an official in the Jilin provincial government, calls the construction of the ginseng plant a win-win strategy.

"On one hand, Jilin province will benefit from the advanced processing and planting technology from South Korea, while on the other, KT&G can take advantage of the large market and rich resources of land and labor in China." Zhang said.

KT&G, originally known as Korea Tobacco & Ginseng and later Korea Tomorrow & Global Corporation, is the leading tobacco company in South Korea.

KT&G has been witnessing a rapid growth in ginseng sales in China since entering the Chinese market. The company established a subsidiary in Beijing in October 2010, and opened a flagship store in Shanghai in November 2010.

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