China: Carlsberg is boosting its strategic commitments in the fast growing market

Danish brewing giant, Carlsberg Breweries A/S, has set up a US$ 46.3 million (€36.7 million) investment in northwestern China's Xinjiang region, the official Xinhua News Agency reported on May 29. Thus Carlsberg has acquired a 49 % stake in the joint venture with Lanjian (Group) Co., a beer and soft drinks maker based in southwest China's Sichuan province.

Xinhua News Agency cited a source from the region's Bureau of Foreign Trade and Economic Cooperation as saying the venture was Xinjiang's first foreign-backed investment company. The new company will invest in beer and beverage projects and training, Xinhua posted.

Foreign brewers have stepped up their strategic investments in Chinese inland provinces, counting on their potential for future growth.

Xinjiang, a region populated largely by Muslim minority groups, reportedly consumes about 14 liters (4 gallons) of beer per capita a year, well below the 20 liter (5 gallon) average for China.

Last year, Carlsberg and a Denmark government-backed investment fund agreed to buy a 50 % stake in a brewery group based in Lanzhou, capital of Gansu province, which neighbors Xinjiang. Carlsberg also joined with Singapore-registered Ongo Investment and minority shareholders to buy a 34.5 percent stake in Wusu Brewery, a beer maker based in Xinjiang.

China's beer production rose 15.2 percent in 2004 over the previous year to 29.1 million metric tons (32 short tons) in 2004, maintaining the country's ranking as the world's biggest beer producer.

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