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Zhongkun set to rent Icelandic land for tourism

Updated: 2012-10-16 10:10
By Mei Jia ( China Daily)

The Beijing-based Zhongkun Investment Group Co Ltd will sign an agreement this month to lease 300 square kilometers of land in Iceland for tourism investment, group Chairman Huang Nubo said.

"We'll pay $6 million for renting the land," Huang said. "But as planned, the total investment for the Icelandic project remains $100 million to finish planning and building in five years."

Zhongkun's Icelandic project comprises a hotel, racecourse and themed resort in the northeast of the country.

Huang said he began buying land for the tourism project in August last year at the invitation of local landowners.

But the deal became mired in doubts over the Chinese private business owner's intentions for the land and was rejected for legal reasons in November by the Interior Ministry.

The deal got back on track in May, after Iceland offered to change the term "buying" to "renting". Huang said in previous interviews that he is happy with the offer because the lease will be valid for 99 years and will probably be continued automatically.

Huang said he received details of the contract in September, and his team is double-checking its content.

Staff members from Zhongkun said the details might undergo further changes but will be close to the group's expectations.

Huang, a poet and businessman, said he is hoping the Icelandic landowners will attend the signing in Beijing, and, in return, he will hold a news conference in Iceland. "I don't expect to gain hugely from the Icelandic project." Huang said. "What I'm confident about is that our project will upgrade Icelandic tourism."

He is planning more business with other Nordic countries.

"In 10 years, the world will know that a man from the Yellow River is doing tourism all over the world," he said.

Huang believes the Icelandic signing will be a great encouragement to private Chinese companies such as his, proving it is right for them to look abroad and do business globally.

"The global economic situation and local protectionism have made it tough for Chinese companies to seek opportunities outside, and tougher still for private Chinese business," he said.

After analysis by Western media, Huang believes the group's ideals and methods bear testimony to the fact that Chinese companies can do well and operate fairly.

Zhang Wang, an expert on corporate social responsibility, pointed to the fact that Zhongkun has dedicated a special chapter to the Icelandic land deal in the group's 2011 Corporate Citizenship Report released on Sept 27.

"The group faced an emergency directly and handled it properly, showing an example of Chinese companies as balanced, responsible and confident in global performances," Zhang said.

meijia@chinadaily.com.cn

 
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