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Chinese Company Turns Old Georgian Factory Into Free Industrial Zone
The Hualing Kutaisi Free Industrial Zone in Georgia. Image: Wade Shepard.

Chinese Company Turns Old Georgian Factory Into Free Industrial Zone

It was once a sprawling Soviet automobile factory on the outskirts of Kutaisi, Georgia’s number two city, 230 kilometers west of Tbilisi.

Over 15,000 workers labored here, most of whom lived in the ultra-pragmatic, no frills high-rise compound right across the street, forming a quintessential factory town.

When it shut down in 1988, the workers were all laid off and the plant was pillaged for anything of worth, as Georgia found itself in a crisis situation. Throughout the next two decades this colossal old factory just sat out there, vacant — decaying to ruins, being swallowed by the foliage of time.

Then China came.

In October of 2015, the former Soviet automobile plant was revived as the Hualing Kutaisi Free Industrial Zone (FIZ). For the next 30 years the beleaguered factory will be under the direction of the Hualing Group, who has taken on the responsibility to renovate, manage, and promote it.

The Chinese company promised to invest $30 million into the project over the first five years alone, and has already dropped a large chuck of this through buying its 36 hectares at market rate from the government and setting up initial operations.

The Hualing Group, a private enterprise who arose in China’s far western Xinjiang province in the same year that the Kutaisi automobile factory folded, is now the largest single investor in Georgia.

The company first entered the country in 2007, after its founder, Mi Enhua, apparently took a trip there and fell in love with the place — or so the story goes.

Whatever is the case, the Hualing Group has so far pumped half a billion dollars U.S. into five large development projects around Georgia, which, in addition to the FIZ, include a new city in the northeastern suburbs of Tbilisi, the largest wholesale and retail trading center in the Caucasus region, a variety of new luxury hotels, and a large-scale wood harvesting business.

Georgia currently has four free industrial zones, and Hualing’s will be the second in Kutaisi. Kutaisi’s first FIZ opened in 2009, and is operated via a partnership between Georgia International Holdings and an Egyptian company called LLC Fresh-Georgia, a home appliance manufacturer. There are also FIZs in Poti and Tbilisi.

Source: Forbes