PepsiCo to invest $1 billion in China

BEIJING (Reuters) - PepsiCo Inc (PEP.N), a U.S.-based food and beverage company, said on Monday it plans to invest $1 billion in China over the next four years, as part of the company's strategy to expand in emerging markets.

PepsiCo's investment in China will fund a variety of major capital programs to expand manufacturing capacity, particularly in interior and western areas, said PepsiCo's chairman and chief executive officer, Indra Nooyi, who is in China this week.

"This is our largest investment in China in the nearly 30 years we have been doing business here, and it is consistent with our broader global strategy of investing in high-growth developing markets," Nooyi said in a statement.

Beverage sales in the U.S., especially sales of bottled water, have been hit hard as a housing slump, credit crunch, job losses and high gas prices have forced cash-strapped consumers make fewer trips to gas stations and convenience stores, eat out less often and drink tap water to save money.

PepsiCo cut its full-year outlook last month as an economic slowdown sapped soft drink demand.

The investments are expected to create thousands of new jobs in China, where PepsiCo and its bottling partners already directly employ more than 22,000 people, it said in the statement.

The announcement was made during a four-day visit by Nooyi, who has been holding meetings with government officials and local business executives and visiting the company's local operations.

The money will also be used to expand local research and development facilities and build the company's sales force to boost product distribution, the company said in the statement.

The statement did not say whether PepsiCo is expanding manufacturing capacity by building up more plants.

Repeated phone calls to the company went unanswered.

(Reporting by Michael Wei; Editing by )