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China to Make Cars in Belarus

Chinese automaker Geely agreed to set up a joint venture in Belarus to assemble its cars, with an eye to eventually export some of the output to Russia, the company said Monday.

Under the agreement, Zhejiang Geely Holding Group will team up with two Belarussian companies, Belaz and Soyuz, in a venture with an annual capacity of 120,000 units.

"The project's production capacity and product line will subsequently be expanded to allow it to supply Russia, Ukraine and the wider CIS market," Geely said in a statement. Geely said it was the first automotive joint venture between China and Belarus.

It is set to produce four models: sports utility vehicle EX7, sedan SC7, hatchback SC5 and crossover LC-CROSS.

Partner Belaz is the world's second-largest mining machinery company, while Soyuz is a producer of auto components, Geely said in a statement. The joint venture is called Belgee.

Geely has an ambition to develop rapidly overseas. It bought Swedish carmaker Volvo in 2010. Most recently, it signed deals to assemble Chinese cars in Uruguay and Egypt.

The Chinese carmaker describes itself as the "fastest-growing automobile exporter in China, with sales to the Russian and Ukrainian markets particularly strong."

The Belarussian joint venture will provide Geely with a platform from which to expand its presence in the CIS market, "representing an important step in the company's overseas ambitions," Geely said.

Between January and June this year, Geely recorded sales of 14,886 and 6,739 units in Russia and Ukraine respectively, giving it the largest presence of any Chinese automobile brand in those markets, the company said.

Overall car sales in Russia amounted to 1.3 million units last year, according to data compiled by the Association of European Businesses in Russia. That is a decline of 6 percent compared with the same period last year.

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