Chinese factories in America? One company inks $2 billion deal to open in Virginia

June 20, 2014, 7:24 PM UTC

It’s been a regular feature of business pages for years: An American company flees to China, hoping to cut cost with the help of cheap labor.

But in a reversal of this trend, a Chinese pulp and paper company, Shandong Tranlin Paper Co., announced this week that it plans to invest $2 billion to establish its first American-based advanced manufacturing operation in Virginia. The project is projected to create 2,000 new jobs by 2020.

Tranlin, which has an annual productivity of 400,000 tons of refined pulp, 700,000 tons of machine-made paper, 400,000 tons of organic fertilizers, and 2.4 billion food and medical packaging boxes, has developed an innovative technology to make paper, using agricultural residuals, such as corn and grain byproducts normally left in farm fields after harvest.

“As we work to grow and diversify our economy, it is vital that we continue to build relationships with our largest agricultural and forestry trade partner, China, through both exports into Chinese markets and Chinese investments in business ventures here,” said Todd Haymore, Virginia Secretary of Agriculture and Forestry.

“Tranlin represents a tremendous opportunity for Virginia’s corn and small grain producers by creating a lucrative new market for agricultural residuals that are typically left in the field,” Haymore added. “Based on the agricultural supply chain opportunities associated with the project, the economic benefit to farmers in this region alone could exceed $50 million per year once the project is complete and operating at full capacity.”

The project will be based at an 850-acre campus located at the James River Industrial Center in Chesterfield County, Va.

Though big by Virginia standards, the move is not unprecedented. Other Chinese companies have come to the United States, among the Chinese equipment manufacturer Sany, which recently opened sleek offices in Georgia as it tries to tap into the American market.