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The Pacific : Westinghouse, Pitney Bowes to Sign $160-Million China Deals : Trade: Commerce secretary expects U.S. firms to sign billions of dollars worth of agreements in Asia.

August 29, 1994|From Bloomberg Business News

BEIJING — Westinghouse Electric Corp. and Pitney Bowes Inc. will sign agreements with Chinese officials Monday totaling $160 million.

Westinghouse and Pitney Bowes chief executives are among 24 officers from U.S. companies visiting China and Hong Kong with U.S. Commerce Secretary Ronald Brown to drum up business for their companies.

The agreements are expected to be the first of many signed to be this week in China. Brown has said he expects American companies will sign several billion dollars worth of contracts as while he's in Asia, reducing the U.S.'s $22.8-billion trade deficit in 1993 with China.

In addition, International Business Machines Corp. is expected to sign agreements with the Chinese Ministry of Electronics, a senior administration official said. Details weren't immediately known.

China, viewed as a potential gold mine for many American companies, will spend hundreds of billions of dollars over the next several years. The country plans to install power facilities and millions of phone lines, buy aircraft, upgrade its air traffic control system and builds highways and buildings.

"There may be one or two other signings (Monday) that could be quite large . . . larger than a billion dollars," said a U.S. trade official.

Under the $140-million Westinghouse agreement, the company will manufacture two 350-megawatt steam turbine-generators for the Jiangsu Ligang Electric Power Co.

Sargent & Lundy, a U.S. engineering firm, will provide plant engineering for the power generation equipment at the plant, which will be located on the Yangtze River. The Export-Import Bank will finance the agreement. Details of the financing weren't immediately known.

Westinghouse hopes this contract will be the first of many in China.

"Winning the intense competition for this order demonstrates our commitment to provide cost-effective solutions to China's need for power," Michael Jordan, president and chief executive, said in a statement.

Secretary Brown said the contract will provide support for an unidentified number of American jobs.

It comes a year after Brown sponsored the U.S. Electric Power Mission to China in an effort to overcome obstacles.

Westinghouse, based in Pittsburgh, supplies air traffic control systems, power generation supplies and business communications systems.

Under Pitney Bowes' $20-million agreement, the company will develop a marketing and business plan for upgrading and modernizing China's postal system. Pitney Bowes will also install its products at the post offices and other government agencies.

The agreement comes seven weeks after Pitney Bowes appointed Zhongyu Postal Code and Information Co. as its exclusive distributor of its mailing machines and postage meters in China. There are 55,000 post offices in China.

"The agreement reflects the urgent desire on the part of the Chinese government to modernize and automate all Chinese offices in general, and post offices in particular, through the application of state-of-the-art systems and equipment," said George Harvey, chief executive.

The equipment for this contract will be made in Pitney Bowes' Connecticut facilities and will be distributed through Zhongyu's six postal branches.

Pitney Bowes, based in Stamford, Conn., makes mailing, shipping, copying and voice processing equipment.

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