A Chinese company is no longer moving forward with plans to open its U.S. headquarters and a manufacturing plant in Effingham County.
Hubei Xingfa Chemicals Group in August announced a “substantial” investment in Effingham County that would generate 50 jobs that would pay an average of $45,000 a year.
The company said it would pay $1.2 million for 83 acres in the industrial park on Ebenezer Road, just off Ga. 21 north of Rincon. It planned to begin construction early this year on production facilities and a headquarters office.
Xingfa had planned to make phosphate and fine chemicals that are used as additives in products such as toothpaste.
In a letter to the county’s Industrial Development Authority (IDA) dated Dec. 29, the company cited problems with its partnership with a U.S. company.
The letter said the U.S. partner was going to buy 30 acres of the land and purchase 60 percent of the finished product.
The letter, written in Chinese and translated by the company into broken English, said, “Our partner not willing to continue to talk about the purchase of land matters, on the other hand we have sold 100 tons product to them and still not receive the payment. Our initial determine is that the problems is the financial situation of the company …
“Since the original partners have a decisive adverse impact in the project, it forcing us to abandon the original investment plan, which makes us feel very sorry,” the letter said.
But there is still hope for Xingfa to come to Effingham, according to IDA CEO John Henry. He said company representatives plan to visit Effingham in February or March to discuss a possible project and scope.
“But the confidence and enthusiasm of our investment in your county still does not change,” the letter, signed only with the company’s name reads. “We hope that our investment projects in Effingham County is a healthy and vibrant project which can not only promote the legal economic development but also carry on the job opportunity at Effingham.”
Henry said the news could be worse.
“It’s not nearly as disappointing as if they had sent a letter saying we no longer have need for your services and we no longer want a relationship,” Henry said. Still, “We’re back to square one after 18 months” of negotiation.
Henry and IDA Chairman Dennis Webb traveled to Shanghai in August to announce the project, along with Gov. Nathan Deal, who was there as part of a trade mission.
Henry said the IDA put the property Xingfa had been considering back on the market and has had a site visit by a promising company that is interested in 10 acres for manufacturing.
“It’s a very good company,” he said of the prospect. “I was very excited about it and I don’t say that often about a site visit.”
Medient delay
Meanwhile, the board agreed to give Medient 60 more days to revise its master plan and development schedule for a movie studio and entertainment project.
Henry said the company needs to sign an agreement with a contractor or engineer.
At its August groundbreaking, Medient announced that a company in Alabama would be the contractor for the project. Henry said that announcement was made before a contract had been signed.
The extra 60 days will not require a change to deadlines for Medient to create jobs or invest capital. But, after the meeting, Henry said he expects those dates eventually will have to be moved.
“There are a lot of things that are beyond our control that we’re going to have to wait for,” Henry said. “This is unlike anything that we’ve done before. … As long as we’re moving forward, I think it’s going to be an extremely great change for this area.”
Board member Charles Hinely asked whether the board will get an answer from Medient in 60 days.
“I left my crystal ball at home,” Henry replied.
“I’m not too optimistic about it,” Hinely said. “They keep moving the line on the need (for water and sewer service). They can’t do that.”