BASF launches major production site in China's Zhanjiang, its largest single investment globally

German chemical company BASF has started full operations at its integrated production site in Zhanjiang, south China, marking its largest single investment globally.

The project, with a total investment of 8.7 billion euros (around $10 billion), comes as China advances its 15th Five-Year Plan, which emphasizes green development and industrial upgrading.

The site is designed to run on 100% renewable electricity and uses electric-driven compressors.

"By utilizing 100% of the renewable energy, our carbon footprint for a site like ours will probably be around 4 million tonnes of CO2. And today we are at 1.7 million tonnes of CO2," said Haryono Lim, president of Mega Projects Asia at BASF, at the inauguration ceremony on Thursday.

Cutting carbon emissions by more than half, the Zhanjiang site is setting new benchmarks for sustainable chemical production.

With approximately 8.7 billion euros invested to date, the site represents BASF's largest single investment globally.

Company executives said the location was chosen for its proximity to the Pearl River Delta and access to infrastructure, including a deep-water port.

The local government's support has been key, too. In turn, the project is now driving the region's broader green ambitions.

"BASF's full operation boosts the region's low-carbon hydrogen transition by developing the hydrogen value chain to attract related industries, supplying low-cost green power from offshore wind and solar, driving green upgrades in local petrochemicals and steel, and helping build a national pilot zone for zero-carbon industrial parks," said Yang Jiedong, director of the administrative committee of Zhanjiang Economic and Technological Development Zone.

BASF is not alone in its commitment. Across the chemical sector, other players are scaling up green investments in China. Germany's Covestro, another chemical heavyweight, has also been steadily expanding its operations in Shanghai, where it operates its largest global production site with 12 plants.

Beyond the chemical sector, German industrial giants have accelerated their investments in China throughout 2025. Siemens Healthineers established a new magnetic resonance imaging base in Shenzhen, while Volkswagen unveiled a full-process R&D and testing center in Hefei – the first of its kind outside Germany – cutting vehicle development cycles by 30%.

A December 2025 survey by the German Chamber of Commerce in China found that 93% of German companies in China plan to stay, and 53% intend to increase their investment.

CEO of BASF Markus Kamieth explained the motivation behind the increase.

"We appreciate that China is continuing to invest in opening up and supporting, let's say, rule-based trade relations with most of the world."