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The Coca-Cola Co will set up two new bottling factories in China's western provinces to tap the market potential of the country's rural areas.

Kerry Beverages Ltd, one of Coca-Cola's partners on the Chinese mainland, signed an agreement with Chongqing Economic and Technological Development Zone over the weekend to build a US$11 million bottling factory in Chongqing, the only municipality in China's west.

COFCO Coca-Cola, another partner of the beverage giant, will build a bottling plant in Gansu Province soon, said Brenda Lee, director of external affairs of Coca-Cola (China) Beverages Ltd.

"In the first phase (of the Chongqing plant) we will invest US$11 million in the joint venture (with Kerry) bottling plant and as the business develops in Chongqing, we shall continue to invest in our local bottling business, just as we did in many other cities," Lee said in an e-mail to Shanghai Daily.

"Chongqing, with a population more than 30 million, is an important hub city with very good business potential in the western part of China," Lee said.

Coca-Cola claims it controlled 51 percent of the sales in China's soft drink market, as it has already built 30 bottling plants in the country. The company, together with its partners such as Kerry Beverages and COFCO Coca-Cola, has poured in a combined investment of US$1.1 billion since 1979.

As there are already bottling plants in neighboring provinces, the new plant in Chongqing will supply mainly to the city.

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