Wuhan aiming to be financial hub

Wuhan is trying to become the financial hub of the China's central region by 2013.

Wuhan, capital of central China's Hubei province, says it has more banks than any other city in central China. At the end of March, Mizuho Corporate Bank, Japan's second largest bank, opened a branch in Wuhan, becoming the first Japanese bank to set up shop in inland China. There are five foreign banks in Wuhan.

"Wuhan is the main city linking China's central and western regions. China's government has been increasing investment in these regions, which may be the next areas to emerge economically, just as the Yangtze River Delta, Pearl River Delta and Bohai Bay areas did in the past," said Miyaguchi Takehito, president of Mizuho Corporate Bank (China). Mizuho's Wuhan branch aims to support some of the 120 Japanese businesses in the city and help Chinese firms looking to invest overseas.

The branch will do business in Hubei, Jiangxi, Sichuan and Chongqing, a reach that is roughly similar to what Wuhan hopes to cover as a regional financial center.

"It's quite necessary to build up a financial center in Wuhan to support industrial upgrades and economic development," said Zhao Bin, vice-governor of Hubei province.

Wuhan is currently constructing a financial district and is setting up an integrated payment system and electronic settlement system along with eight neighboring cities.

"It's possible for Wuhan to become the regional financial center in the near future," said Jiang Libing, president with of the Wuhan branch of the Guangdong Development Bank.

"Wuhan has convenient transportation links and a batch of financial colleges. The cost of real estate and human resources is much lower than in the costal cities," said Jiang.

But Wuhan has competition; Chengdu and Chongqing also recently announced plans to establish themselves as regional financial centers in the west.

Local governments, looking at what happened in the Yangtze River Delta and Pearl River Delta, increasingly see developing their financial sector as one of the keys to building a booming economy. According to incomplete statistics, about 28 cities in China have announced plans to become international, national or regional financial center.

"A region's economic development is highly dependent on support from its finance sector. The financial market's scale and depth tend to decide the pace of economic development," said Deng Xiangrong, a professor at Nankai University of Tianjin.

This is not Wuhan's first attempt at being a financial center.

In 1925, there were about 200 financial institutions in the city, including nine regional headquarters of multinational banks. But war, chaos, flood and famine seriously crimped the burgeoning financial center's further development.

Many of the older buildings on Jianghan road, in the Wuhan's new business district, once housed these banks.

Zhou Lihua and Wei Qi contributed to this story

(China Daily 04/13/2009 page5)