Transformer Market - Malaysian and Chinese Power Groups Band Together to Build a Transformer Plant in Cambodia

The integrated Malaysian electric power technology group Pestech International Berhad is going to cooperate with China's Shandong Electrical Engineering & Equipment Group (SDEE) to enter the Cambodian power infrastructure market.

These two companies will combine their efforts, researching the Cambodian power market in order to promote their electrical power equipment, as well as sales and distribution. The project includes a joint transformer production facility in Cambodia. The main function of Pestech will be the execution of the project, while SDEE is going to focus on providing essential funds and equipment.

This will not be Pestech's first project in this country. Earlier this year, Diamond Power Ltd., the company's sixty percent owned subsidiary, signed a contract with the Ministry of Mines and Energy and Electricite du Cambodge to establish the 230kV transmission line between Kratie and Kampong Cham.

SDEE is a subsidiary of the State Grid Corp of China (SGCC), and it provides power to almost 90% of China, serving 1.1 billion people throughout the country. SGCC is the biggest power grid company both domestically and globally. It constructs and operates power grid infrastructure mainly in Northern China.

China dominates in the global electrical transformer trade. In 2014, China exported 236 thousand tonnes of electrical transformers totaling 3,185 million USD, 13% over the previous year. Its primary trading partner was the U.S., where it supplied 9.3% of its total electrical transformer exports in value terms, accounting for 11.9% of U.S.'s total imports.

From 2007 to 2014, China was a net exporter on the transformer market. Over this period, exports consistently exceeded imports in value terms. In physical terms this difference was even more pronounced.

Germany and Mexico were among the other main global suppliers of electrical transformers in 2014. However, the fastest growing exporters from 2007 to 2014 were China (+8.1% per year) and Austria (+3.6% per year). With this steady growth, China was able to further strengthen its position in the global export structure.

China's top 5 trading partners in 2014 were the U.S., Japan, Viet Nam, Germany and India, with a combined 26.5% share of China's electrical transformer exports. The share of Viet Nam increased modestly (+2.3 percentage points), while the share of India illustrated negative dynamics (-2.7 percentage points).

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Source: World: Electrical Transformers - Market Report. Analysis and Forecast to 2020