The Guangzhou Iron & Steel Enterprises Group is planning to move its existing production base to a multi-billion project in attempt to clean up the urban environment.

The group plans to build a new integrated production base in a development zone for US$4.95 billion by 2014, replacing its present urban site.

The new base, to be erected in the Nansha Economic and Technological Development Zone in Guangzhou, capital of southern China's Guangdong Province, is expected to be capable of turning out 5 million tons of iron and steel products annually, said deputy general manager Yang Yongquan.

Founded in 1958, the group's current site covers an area of 1.6 square kilometres and has an annual capacity of 150 tons at present. However, as Guangzhou's urbanization continues unabated, the steel and iron plant has increasingly been a target for complaints of pollution by residents.

The move, to be carried out in three stages and on a planned area of 10 square kilometres, will make an important step in the city government's efforts to clean up Guangzhou ahead of the Asian Games in 2010.

"The new base will follow stricter environmental standards," Yang said.

The group kicked off construction with a US$1 billion hot-dip galvanized sheet steel plant via joint venture with Japan's JFE Steel Corp in January this year. With an annual capacity of 400,000 tons, the JV enterprise is expected to go into operation in 2006 and primarily meet demand from the automobile industry.

Editor: Wing