Turkish Investment Comes to Fruition, as MDF Factory Opens in Qazvin

EghtesadOnline: AGT Company’s factory, in which the Turkish side has invested a total of €40 million, was inaugurated on Monday in Qazvin Province’s Caspian Industrial Zone, during a ceremony attended by Mohammad Baqer Nobakht, the head of Plan and Budget Organization, along with local officials.

News ID: ۷۵۰۸۱۴

26 August 2020

AGT is a producer of engineering woods such as MDFs, MF-MDFs, panels, profiles, parquets and different types of floorings.

The new factory has created 150 jobs for the locals and aims to meet part of the Iranian market demand while providing a platform for exports to neighboring countries.

Director General of Turkish company AGT, Sirzat Subasi, and the head of Qazvin Industrial Towns Company, Hamidreza Khanpour, had signed a memorandum of understanding in June 2017 for the Turkish side to invest in building this factory. Back then, the volume of investment was estimated at €70 million.

"This is the second largest foreign investment made in Qazvin in 2017 and that's why it's important to us. Moreover, it is the first investment made by AGT in a foreign country, making it significant for them," Khanpour told Financial Tribune at the time.

Established in 1984 in Antalya, AGT is active in the construction industry with its production of flooring, door, wall panels and baseboard, and in the furniture and decoration sector with its production of MDF, MDF-LAM panel and profile. It has more than 1,000 employees and over 1,000 sales outlets in five continents.

"The Turkish company has a 60% share in the Iranian market for these products. Therefore, in order to retain their market share in Iran and reduce costs, they decided to construct a factory in the country. Qazvin was chosen due to its strategic location and its proximity with the capital, Tehran. Moreover, the availability of required infrastructure was taken into account in selecting the factory's location," Khanpour said.

€470m Foreign Investment in Qazvin Industrial Towns to Date

A total of €470 million worth of investments by 17 foreign entities have been made in Qazvin Industrial Towns since their establishment, according to the chief executive of Qazvin Industrial Towns Company.

In an interview with IRNA, Khanpour noted that foreign investors include those from Germany, France, Poland, Italy, South Korea, India, Turkey, Iraq, Afghanistan and Pakistan.

"These investments have generated 1,869 direct jobs in Qazvin," he added.

Chinese businessmen are investing $30 million to produce ceramic and tiles in Qazvin's Khorramdasht Industrial Town, Deputy Governor-General of Qazvin Isa Qobadi said earlier this year.

The official made the statement after holding a meeting with a Chinese delegation in Qazvin on Saturday.

"Considering Qazvin's proximity to mines, investing in ceramic and tiles can be a good investment opportunity," he said, referring to the fact that Qazvin is in the vicinity of the capital Tehran.

He added that there is mutual trust between Iran and China, and that Chinese investors are not concerned about investing in Iran.

Last year, an Indian manufacturing company of various brands of home appliances said it planned to make investments in Qazvin Province for the establishment of a production line.

Representatives of the Indian company held talks with provincial officials in Qazvin, Mehr News Agency reported, without mentioning the name of the Indian company.

As for the reason behind selecting Qazvin Province from among other Iranian provinces for investment, the Indian side said compared to Tehran, Qazvin enjoys high potentials and capacities for investment activities.

“Our company will start production in Qazvin in 2020 and all state-of-the-art technologies for manufacturing home appliances will be transferred to this province within five years,” the Indian side said.

“Given the US sanctions and in the absence of two famous South Korean brands of home appliances in the Iranian market, namely Samsung and LG, a suitable opportunity has been created in Iran for investment.”

The two South Korean brands had for long dominated Iran's home appliance market prior to the latest round of US sanctions.

The Indian company started manufacturing home appliance parts and equipment in 2004 for the two South Korean companies, but the company embarked on producing these parts under its own brand in 2012.

Once sanctions imposed on Iran are lifted, Iran will get the lion’s share of the whole Central Asian markets, according to the Indian side, adding that in the first phase of this project, the company will manufacture refrigerators, LCD TVs and washing machines in Qazvin Province.

Later, a delegation of foreign businesswomen and female entrepreneurs from Armenia and Russia were briefed about the economic capacities of Iran's Qazvin Province in a meeting.

“The meeting was held at Qazvin Chamber of Commerce, where the 30-member delegation discussed economic capacities and opportunities with the Iranian private sector,” the head of Qazvin’s Businesswomen Association Fatemeh Ghafoori told Mehr News Agency.