Siemens to invest US$3b in Asia-Pacific by 2000
Siemens to invest US$3b in Asia-Pacific by 2000
By Aloysius Bhui
PENANG, Malaysia (JP): Siemens AG of Germany, a leader in telecommunications, electronics and power generation businesses, said that it will invest another US$3 billion in the Asia-Pacific region by the end of the century.
"Further investments are required for the company to become an integral part of the local economies we serve," Gunther William, who oversees the Asia-Pacific for Siemens, said on Wednesday.
The press conference at Siemens' semiconductor plant in Penang was attended by journalists from Indonesia, China, Taiwan, Hong Kong, the Philippines, India, Pakistan, South Korea and Australia.
Wilhelm said that Siemens has already invested more than $1.5 billion in the region.
"In line with the planned investment expansion, we also expect to increase the local workforce from the current level of 45,000 people to around 70,000 by the year 2000," he said.
He reported that Siemens has witnessed fast growth in the Asia-Pacific, and it projects a business volume of around $17 billion per annum by the year 2000. The region will account for 20 percent of the company's total business volume.
For the 1995/1996 fiscal year, ending Sept. 30, the company expects total orders in the region to surge by 30 percent to $10 billion. The figure includes $8.5 billion from consolidated companies and $1.5 billion from activities which have not yet been consolidated.
Of the consolidated orders, $3.3 billion is expected from the energy sector, $1.8 billion from telecommunications, $720 million from components, $720 million from health care, $510 million from transportation, $330 million from lighting and $180 million from information technology.
Business volume in the Asia-Pacific grew from only $4.4 billion in the 1991/1992 fiscal year to $6.3 billion in 1993/1994, and is projected to increase to nearly $10 billion in 1995/1996.
For the current fiscal year, Siemens expects total orders of between $64 billion and $65 billion and sales of roughly $60 billion.
Power generation
Wilhelm said that in the last five years, the company secured orders for power plants with a total generation capacity of 18,000 megawatts (MW). Siemens currently has a 20 percent market share in the region.
The managing director of Siemens Power Generation Asia Pacific Sdn. Bhd., Jorge Haslestad, confirmed that in the current fiscal year, Siemens has secured orders for thermal power plants in the region with a total generation capacity of more than 6,000 MW. About 3,000 MW of the orders are related to independent power projects with Siemens equity participation.
"We welcome the opening up of the power generation business to private investment," Haslestad said on Tuesday at the YTL Paka power plant, which is located near the town of Kerteh in Terengganu province.
Siemens Power Generation Asia Pacific Sdn. Bhd. is a fully- owned subsidiary of Siemens AG established in Kuala Lumpur in 1993 to handle power plant projects in the Asia-Pacific region.
Haslestad said that this year, Siemens has won four projects involving its own equity: the Rizhao project in China, the Paguthan in India, the Paiton II in Indonesia and the Rousch in Pakistan.
Wilhelm also said that the company will take advantage of the rapid growth of the Asia-Pacific electricity market, which is expected to grow 9.9 percent per annum from 1995 to the year 2000, compared with 5.4 percent in Europe and 6.7 percent in North America.
He said that the Asia-Pacific's share of today's $2,140 billion world electricity market has grown from 13 percent in 1960 to about 38 percent at present.
Within the next ten years the Asia-Pacific will account for nearly half of the world electrical market, he noted.
The world electricity market is expected to increase from $2,140 billion presently to $3,000 billion in 2000, of which the Asia-Pacific is likely to account for 40 percent of the total.
Wilhelm refused to disclose what proportion would be invested in each country in the region, saying only that the company will focus on its main business lines.
Commenting on Siemens' future plan in Indonesia, Wilhelm said that the company is still looking for the most prospective sector.
He said that in the next few weeks, the company's joint venture with Indonesia's PT Trafindo Perkasa will build a plant to produce fiber-optic cables.
"We expect to produce around 70,000 kilometers of fiber optic cables per annum once the facility is fully operational," he said.
Investment in the fiber-optic plant, according to Wilhelm, is $25 million.