In a landmark move aimed at enhancing industrial ties and boosting economic growth, KIA Corporation is set to invest approximately $194 mn in the establishment of a cutting-edge automotive manufacturing plant in Kostanai, Kazakhstan. The agreement was officially signed by Kazakh Deputy Prime Minister Roman Sklyar and Sang Gwon Jung, president of KIA Corporation Russia and CIS, signaling a significant milestone in the collaboration between the two nations.
The new venture, named KIA Qazaqstan, will oversee the construction and operation of the plant. This pioneering partnership reflects KIA's commitment to extending its global footprint and marks the first foreign collaboration in the company's history. With the full support of the Kazakh President and government, the KIA Qazaqstan joint venture aims to commence construction as early as October.
Sang Gwon Jung, President of KIA Corporation Russia and CIS, expressed gratitude for the enthusiasm shown by the Kazakh President and government, highlighting their role in bringing this venture to fruition.
"Thanks to the keen interest from the Kazakh President and the government, we decided to establish a KIA plant in Kazakhstan. We will make every effort on our part and plan to start construction in October. This is KIA’s first foreign collaboration," he stated.
The state-of-the-art facility, spanning an impressive 85,000 square meters, is projected to kickstart a comprehensive production cycle by 2025. Upon reaching full operational capacity, the plant is anticipated to provide employment opportunities for nearly 1,500 individuals, contributing to the local workforce and economy.
Beyond the immediate benefits to the job market, the collaboration between KIA and Kazakhstan holds broader significance. During discussions between the two parties, avenues for enhanced industrial cooperation were explored. Joint production initiatives escalated localization efforts, and the development of engineering personnel specialized for Kazakhstan's automotive sector were among the topics deliberated.
Kazakh Deputy Prime Minister Roman Sklyar acknowledged the rapid development of relations between Kazakhstan and South Korea. He emphasized the significance of KIA's involvement, stating;
"Relations between Kazakhstan and South Korea are experiencing rapid development. The focus from a globally recognized brand like KIA is a milestone event for the automotive industry, which is a strategically important sector in our country’s industrial development."
Recent years have witnessed a remarkable surge in economic engagement between Kazakhstan and South Korea. In 2022, the trade turnover between the two nations exceeded $6 bn, underscoring the robust nature of their economic ties. Notably, the volume of foreign direct investment from South Korea to Kazakhstan reached an unprecedented $1.5 bn in the same year, illustrating the substantial confidence and interest that South Korean businesses have in Kazakhstan's economic prospects.
As the KIA Qazaqstan joint venture embarks on its mission to establish the new manufacturing plant, the collaboration is set to catalyze not only technological advancements and economic growth but also deepen the ties between two nations committed to forging a prosperous future together.
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