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Global CEO of GE Industrial Systems: Three factors motivate GE to choose Chongqing

On April 24, GE, Chongqing Machinere & Electronics Holding (Group)., Ltd (CQMEG) and Administrative Commission of Chongqing Liangjiang New Area formally signed an agreement that GE and CQMEG will build a manufacturing base for high-low voltage electrical equipment in Lingjiang New Area joint contribution of more than 100 million yuan. Under the agreement, GE Industrial Systems and CQMEG will input 125 million yuan to build the manufacturing base for high-low voltage electrical equipment in Longxing Industrial Park of Liangjiang New Area. The area for production and scientific research of the base will reach 23,000 square meters. The construction of project is anticipated to begin in the latter half of this year and will formally go into operation at the end of 2014.  After the design capacity is reached, the annual value of production is expected to reach 500 million yuan. 
Why does GE Industrial Systems choose to invest in Chongqing? What is GE's future development planning in Chongqing? Will the competition in Chongqing electrical engineering market be more fierce as a consequence? On April 24, Bob Gilligan, the Global CEO of GE Industrial Systems, said in an exclusive interview that three factors including the great market potential of high-low voltage electrical equipment motivate GE to choose Chongqing. In the future, GE will earn profit in Chongqing for industries like data center, cloud computation and telecommunications etc.
Journalist: What motivates GE to build the high-low voltage electrical equipment base in Chongqing? What is your opinion on the market potential of relevant products?
Bob Gilligan: In order to penetrate the market of Western China, we have been looking for partners in China since many years ago. After communication with CQMEG, we find a lot of complementary advantages in each other so as to bring about today's cooperation. Meanwhile, Chongqing has the favorable environment for investment. As the project proceeded, Chongqing municipal government and the Administrative Committee of Liangjiang New Area provided good service for the smooth progress of the project. In addition, according to our predication, the annual market size of high-low voltage electrical equipment in China is 22.5 billion US dollars, which is generated with the economic development and infrastructure construction demand. Chongqing has become one of the cities with the fastest development in Western China. Take Liangjiang New Area for example, its GDP and population in the future 10 years will be doubled and redoubled, and thus there will be a huge demand for infrastructure construction and a variety of supporting facilities. That's to say, there will be a huge demand for high-low voltage fittings in Chongqing as well as in Western China. It is the right choice for GE to base Chongqing for expansion into Western China.
Journalist: What is the strategic position of Chongqing in the development layout of GE Industrial Systems?
Bob Gilligan: GE has realized that the participation in the development of a market is not simply selling the products. We wish to become a part of the regional economy, and get close to clients to know about the market. At the same time, we still need to join powerful partners to provide better service to clients.
In the past 10-20 years, the development of GE in China was focused on Beijing, Shanghai and coastal regions. In the past 4-5 years, GE began to advance into Western China and has established innovation centers in Chengdu and Xi'an. GE has attached more importance to Chongqing. As the engine for economic development of middle and western areas of China, Chongqing is the strategic pivot for GE Industrial Systems to promote the business in middle and western areas of China.
Journalist: In what fields does GE wish to find cooperation opportunities in Chongqing market in the future?
Bob Gilligan: Besides high-low voltage electrical equipment, we are also interested in developing data center and telecommunication industry in Chongqing. In the market of China, besides the development of rail transit and telecommunication industry, we also have advanced technology in UPS, power converter, digital conversion etc. We will continuously pay attention to the application of these technologies in the market of Chongqing.
Now, there is no specific plan for cooperation with private enterprises of Chongqing. While as early as 14 years ago, we started to cooperate with a private enterprise in Shanghai to establish a joint venture company for manufacturing of power distribution cabinet. Therefore, we have cooperation not only with state-owned enterprises of China, but also with private enterprises. As we examine and evaluate every investment or joint venture project, we always seek to maximize the win-win opportunity with the cooperation partner and then actively bring about the opportunity.
Journalist: Before this, enterprises like Honeywell and ABB entered Chongqing electrical engineering market one after another. Is this the best investment time for GE?
Bob Gilligan: It is not late for GE to enter Chongqing. It is the best time to do that. Chongqing is stepping into the rapid growth period of sustainable development, so we are optimistic about the development prospects of the joint venture in Chongqing. Meanwhile, the joint venture brings to Chongqing the most advanced DC switch gear technology in the world. The equipment and products provided by us are different from those of Honeywell and ABB, and there is no overlap among most of the products.
   

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