NANNING - A Singapore company will invest an initial 1 billion yuan (S$206 million) to build an integrated logistics park in southern Guangxi.

Singapore's Minister in the Prime Minister's Office Chan Chun Sing on Friday (Sept 1) attended the launching ceremony of the logistics park in Nanning city, the capital of the autonomous region.

In a short opening address, Mr Chan noted that the park could play a key role in supporting the Southern Transport Corridor, a network of railways linking Guangxi to western Chongqing.

Quoting the Chinese saying, "one minute on the stage requires 10 years of practice off stage", Mr Chan said the launch of the logistics park is a good start to the building of a seamless link to move cargo along the new transport corridor to China's western region.

When ready, the Southern Transport Corridor could be a more cost-effective way for companies in South-east Asia to go into western China, via Guangxi's Qinzhou port at Beibu Gulf (the Gulf of Tonkin).

Nanning, where the logistics park is located, is one of the key nodes on this corridor.

The 3 sq km logistics park is the first of such large-scale investment by Singapore shipping company Pacific International Lines (PIL) in China.

"Guangxi does a lot of border trade with Vietnam, and many of the imported goods are sent to Guangzhou for processing," PIL managing director Teo Siong Seng said to reporters after the ceremony. "With this park, we hope to attract businesses to do some of the processing and packaging here."

The entire park will take eight to 10 years to build. The first phase is estimated to take three years to complete, and part of it will be in a bonded zone - a special trade area where the goods will enjoy preferential tax policies.

On Friday morning, Mr Chan also met Guangxi party boss Peng Qinghua and Guangxi chairman Chen Wu.

Mr Chan will travel to Guizhou on Saturday.