Following the announcement in late May by Jintian Paper (Dongguan) to launch a 2.5 million/ mtpy packaging paperboard project through partnership with a financial institution in Xiangshui County, northern Jiangsu, Jingxing Paper – headquartered in Zhejiang Province – entered into an "Industrial Project Investment Framework Agreement" in recent days with the Management Committee of Sihong Economic Development Zone in Suqian District, northern Jiangsu. Under the Agreement, Jingxing Paper will build a mill at 2 million/mtpy capacity to produce packaging paperboard and tissue paper. The investment in succession of two mid-to-large and non-local paper companies to construct mill complexes over 2 million/mtpy each in northern Jiangsu has attracted significant attention of the market!

Jiangsu is a major economic province in China, and has stayed in the top-3 in the national GDP ranking and No. 2 in fiscal revenue by provinces/municipalities for many years. In 2020, the Province's GDP reached RMB10.27 trillion, becoming the 2nd province in the country to go beyond the trillion mark after Guangdong Province! Jiangsu is also the 3rd largest paper and board production province in China, hitting 14.02 million/mt in the 2020 output and hosting large production complexes of quite a few well-known paper companies, such as Nine Dragons, Lee & Man and APP (including Bohui).

However, Jiangsu is geographically divided by the Yangtze River and economies in the north bank of the river differ significantly from the south. In 2020, much of the Province's RMB10.27 trillion GDP and RMB905.9 billion of fiscal revenue came from the south. And among the 38 counties and cities whose individual GDP exceeding RMB100 billion in China today, there are 16 in the south of Jiangsu. Most significant are Kunshan and Jiangyin whose combined GDP go beyond RMB800 billion! And for this reason, the Province's paper industry, especially many large mill complexes, were first built in southern Jiangsu. Today, efforts are growing to break such an unbalanced state! Though without rich timber lands as Guangxi in southern China, northern Jiangsu has ample reed, wheat stalks and other resources. Its vast railway, highway, port and other transportation networks are significantly better than Guangxi, and provide better access to markets in east, central and north China, and even extend to markets around the world through the "Euro-Asia Railway". With further optimization by the local governments to attract investment, more “platinum investors” will likely come and settle down in the area, thereby helping the transformation of local industries, upgrade of local economy and improvement of people's living standards.

For Jingxing – a company that has the history of pioneering growth through sino-foreign JV and public listing – this is also a win-win deal! At end-2020, Jingxin owned 1.45 million/mtpy of paper and board capacity at its base area in Zhejiang. With the planned 2 million/mtpy project, plus the on-going construction of a 120,000/mtpy tissue project in Zhejiang and 1.40 million/ mtpy of pulp and paper project overseas (800,000/mtpy pulp and 600,000/mtpy of paper and board), the overall production capacity of the company will reach 5 million/mtpy when all go into commercial runs. Jingxing will thus become a large and international paper company!

It is expected that more Chinese paper companies will come to North Jiangsu to explore opportunities and models suitable for their growth.