China Fiber Optic Network Systems Group Ltd. has invested $50 million to set up a plant in Surrey, British Columbia, for the manufacture of components for China's fibre-optic communications network.
The plant is set to employ 200 people and is targeted to be up and running in June to produce $100 million worth of export sales to be brought back to China. The plant will be manufacturing ceramic ferrule banks, the tiny components used to manufacture fibre-optic wire connectors.
China Fiber is the supplier for Chinese state-owned telecommunications firm China Telecom, which figures in the government's plans to push fibre-optic networks as the standard for nationwide high-speed Internet.
China Fiber Optic will also be setting up its North American headquarters in Vancouver, according to company chairman Zhao Bing. Its Canadian subsidiary F-Pacific Communications also set up a research-and-development facility in Redmond last year.
"The main reason that we established manufacturing in Canada was first, B.C.'s electricity cost is very competitive," said F-Pacific CEO Bei Nie. The lower cost of electricity offsets the higher cost of Canadian labor, according to the CEO.
The plant represents a $50-million investment by F-Pacific in the Candian city, and Nie said that this initial investment could expand up to $100 million.
Nie also cited Canada's intellectual property protections, which will help protect the patented technology that China Fiber and F-Pacific will be using to produce the ceramic ferrule banks.
Canada's temperate, less-humid climate is also expected to help in the production of the components, which are sensitive to temperature and humidity.
Initial production is meant for use in China, but eventually China Fiber is looking to cater to the North American market.
"We will provide our specialized equipment to Canadian telecommunication companies [sic] bring high-speed fibre-optic connectivity to more homes," Nie said.
Yuen Pau Woo, president of China Fiber's Vancouver headquarters, voiced out the plans China Fiber has for North America.
"If [sic] can penetrate the North American market working Telus, Rogers, Bell and Sprint, and all the other suppliers, imagine the kind of expansion we could see in North America," he said.