BASF SE - the world's largest chemicals company by sales - will invest 10 billion euros ($13.5 billion) with partners in the Asia-Pacific region by 2020 to boost growth, with half of it to be invested in the Chinese market.

Albert Heuser, president and chairman of BASF China, estimated that half of the investment will be used to strengthen the capabilities of existing plants, expand research and development facilities, and launch new projects.

A source at the German company said the company will be responsible for collecting about 80 percent of the funds, with the rest raised by its partners.

Heuser said projects will be launched in Shanghai and in some western Chinese cities to meet the growing market demand.

About 25 percent of the company's global R&D will be conducted in Asia Pacific by 2020, aiming to develop innovative solutions to address the region's challenges of resource efficiency, food and nutrition, and quality of life, said Martin Brudermuller, vice-chairman of the BASF board of executive directors for Asia Pacific.

"Based on our strong global R&D network, we will considerably strengthen our innovation capabilities in Asia Pacific, enabling us to better serve our customers in all industries in the region," Brudermuller said.

By 2020, BASF plans to have a total of around 3,500 R&D staff in the region, up from about 800 in 2012.

The company is also establishing research facilities in the areas of electronic materials, battery materials, agriculture, catalysis, mining, water treatment, polymers and minerals.

Following the inauguration of the BASF Innovation Campus Asia Pacific in Shanghai, it is also considering establishing a second innovation campus in the region.

"We will start a new wave of investment, expected to be more than 10 million euros, to expand the newly established innovation center," said Heuser.

Materials for sports shoes, for instance, will be researched at the center, not only for the Chinese market, but for global markets as well, Heuser said.

"We will extend our R&D from Pudong, a core service platform in Asia Pacific, into Japan and South Korea to develop battery materials and electronic chemicals," he said.

BASF also is investing around $121 million to set up a world-scale production plant at the Shanghai Chemical Industry Park to produce high-performance resins and electro coatings.

The launch of the production line is planned for the second half of 2015 to address the increasing demand for high-quality coatings solutions in growing industries, notably the automotive industry, in Asia Pacific.

"The continued investment in our infrastructure and capacity demonstrates our strong commitment to supporting our customers' growing business in the automotive market in the Asia-Pacific region, particularly in China," said Peter Fischer, senior vice-president of BASF Coatings Solutions Asia Pacific. "With the new plant in place, we are able to respond to customers even quicker and further enhance our efficiency of logistics."

His words were echoed by Heuser.

"We must follow our automaker customers, who are moving production facilities to the country's western area," he said.

Investment, Heuser added, will be injected into Chong-qing, Maoming in Guangdong province and into the Xinjiang Uygur autonomous region to meet demand from local customers.

The heavily funded strategy in Asia Pacific aims to increase sales in the region from this year's 11.7 billion euros to 25 billion euros in 2020, which represents an annual 9 percent growth rate, Heuser said.

chenqide@chinadaily.com.cn

(China Daily USA 11/05/2013 page16)