The Irish property company Treasury Holdings yesterday signed a joint venture deal with a Chinese firm to develop a 900-acre site close to Shanghai in an investment worth €1.2 billion.
The agreement with the Shanghai-based Dongtan Company is one of the largest single property development projects undertaken by an Irish company.
The joint venture company plans to develop a mix of retail, residential, office, leisure and conference facilities on an island north of Shanghai, which is the fastest growing city and main business hub in mainland China.
Treasury Holdings, which is also developing the Spencer Dock area in Dublin, announced the deal at a signing ceremony attended by the Taoiseach, Mr Ahern, on the Government's trade mission to mainland China and Hong Kong.
Mr Richard Barrett, co-founder of Treasury Holdings, said the firm had spent three years putting the joint venture deal together. Treasury Holdings is also evaluating other potential Shanghai property deals.
"There is a lot of foreign influence in Shanghai, which makes it a good jumping-off point for Irish firms coming to China to do business," he said. "But it is important to find the right local partner."
Treasury Holdings will now seek to raise funds from international investors to finance the €1.2 billion island development, which will shortly be linked to the Chinese mainland via a new nine-kilometre tunnel and bridge that are under construction.
The company hopes to begin work on the project this year and open it in phases up to 2010 in time for the World Expo exhibition which is scheduled for Shanghai during that year.
Over the past 10 years Shanghai has experienced massive growth and attracted billions of euro in foreign direct investment as it transformed into China's main business and technology centre. Some experts predict that up to 50 million people will live in Shanghai and its sprawling suburbs by 2020. The city's economy grew by 13.5 per cent in 2004.
"This is a massive opportunity to expand in such an exciting and growing market," said Treasury's development director, Mr Robert Tincknell, who will oversee the Shanghai development.
Plans for the development had not yet been finalised but leisure facilities proposed for the island site include a golf course, hotels and a marina, he said.
The deal was announced at a business breakfast attended by the Taoiseach which saw Irish firms and third-level colleges clinch deals worth €45 million in Shanghai. Cork-based Farran Technology Limited clinched a multimillion euro deal to supply specialist equipment for China's space programme. The company, which was founded as a spin-off from University College Cork in 1984, develops customised short wavelength microwave or "millimetre wave" technology. It will be used to assist the Shanghai Spaceflight Institute to develop scientific electronics for use in planned weather observation satellites.
"This is a very important deal with Ireland and Farran because it gives us access to technology that we do not have yet," said Mr Meng Zhi Zhong, chief satellite designer at Spaceflight. "We plan to build seven satellites in Shanghai which will be used to map weather patterns."
Púca Technologies, which develops technology that enables firms to use text messaging and other mobile services in running their businesses, announced that it had bought Beijing-based firm Mobile-Factor.
Mr Eamon Hession, Púca's managing director, said the acquisition would give his firm access to the rapidly growing Chinese mobile phone market.
"By the end of this year it is expected that up to 400 million people will own a mobile in China making it the biggest market in the world," he said.
Several other Irish firms such as Cornerstone, Mobile Tornado, CNG Travel and MBC also signed deals in Shanghai in the presence of the Taoiseach.
The University of Limerick, Griffith College Dublin, the Dublin Institute of Technology and University College Cork signed deals with Chinese education partners, bringing the total value of the contracts signed on the trade mission to €115 million. Further deals will be announced later today by the Taoiseach in Hong Kong on the final day of his visit.