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Downturn not bad news for Dalian park

By Huo Yongzhe and Zhu Chengpei (China Daily)
Updated: 2009-06-19 13:55

Downturns are not necessarily a bad thing, feels Gao Wei, as the fittest firms have the chance to prove their resilience - by outliving the competition.

But for the president of Dalian Software Park (DLSP), there is another reason to smile. The global economic decline is forcing many software companies in the West, as well as those in Japan and South Korea, to bring forward their outsourcing plans.

And, lo and behold, they come knocking on his door.

"Even with the chill of the economic slowdown, our business is growing at a considerable pace," said Gao, in an exclusive interview with China Daily. His park's revenues rose 10 percent in the first quarter of 2009.

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There are many reasons why Dalian is attractive to software firms from developed countries looking to outsource. It has a ready supply of well-educated software professionals. And the port city in the northeast is close to important markets such as Japan and South Korea.

Created in 1998, the privately run DLSP has transformed what was literally a piece of wasteland in Dalian city's western suburbs into a sprawling community that is home to more than 300 companies. The park boasts big names such as IBM and HP, to name just two of the 32 Fortune 500 firms that are based there.

And with most - 88 percent, according to one survey - of its clients somewhat affected by the downturn, his company is going one step further. It has offered to lessen their burdens by, among other things, cutting air-conditioning costs and bringing in second-hand office furniture.

But weathering the downturn is not the only thing on Gao's mind these days.

Going forward, he wants his park, which has traditionally done well among Japanese firms, to be able to attract more companies from English-speaking countries.

"A diversified clientele makes sense," points out Gao. "Because when the next downturn comes, we know we have our eggs in many different baskets."