TA ANN WITHDRAWS FROM PLYWOOD MILL INVESTMENT IN CHINA

By Edward Subeng Stephen

SIBU (Sarawak, Malaysia), Aug 27 (Bernama) -- Ta Ann Holdings Bhd said today
it is withdrawing its US$4 million investment in a plywood mill project in
Yangzhou, China, as the country is no longer the place for cheap labour.

Chief Executive Officer Datuk Wong Kou Hea said the situation in China has
changed very much following its emergence as the Asian economic powerhouse.

"Just recently there was a workers' strike demanding for higher pay. Since
there is not much merit for us to go ahead with our project, we've decided to
pull out," he told Bernama after the company's EGM here Friday.

Ta Ann Holdings formed Ta Ann Eco-Timber Industries Pty Ltd to undertake the
project in which it had invested US$4 million mainly to buy land and machinery.

Wong said the money will be used to invest in other viable projects.

On the recent rainy spell in the east Malaysian state of Sarawak, resulting
in tight log supply in the market, Wong said his company's plywood production
has not been affected.

"We're quite lucky as we've imported veneer from our project in Australia,
thus allowing our sawmill to run full swing.

"Eco-products represents about 50 per cent of our total production, which
is about 25,000 cubic metres monthly. Last year, it only accounted for between
10 and 15 per cent.

"Actually, this is a new product for us. It's still under market promotion,
but we believe we'll enjoy profit in the near future since the demand for
eco-products are increasing and orders are coming in," he said.

On its oil palm sector, Wong said Ta Ann recently inked an agreement with
the Sarawak Land Custody and Development Authority to jointly develop two
parcels of Native Customary Rights land in Kanowit, adjacent to its Naman
plantation and palm oil mill.

"We're expecting not less than RM22 million (US$7.09 million) investment,"
he said.

The two parcels of land have a total combined area of 11,000 hectares," he
said, adding that Ta Ann was looking to increase its land bank for oil palm.
-- BERNAMA


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