1. System advantages:

The reform of market economy system in Zhejiang Province has taken a relatively leading position with socialist market economy system fundamentally established: the proprietorship structure of keeping the public sector remaining dominant and allowing diverse sectors of the economy to develop side by side has been comparatively perfected, an open market system with orderly competition has initially been set up, a new distribution framework has taken shape, and multi-level social security system has primarily been established. A predominant advantage of the market reform has come into being.

Private economy of our province is where the economy¡¯s vigor, advantage and potential lie in. In 2005, the GDP of Zhejiang Province reached RMB 1,336.5 billion, going up by 12.4% when calculated at comparable prices. The initial estimation showed that among the total GDP in Zhejiang, the state-owned economy was RMB 380.9 billion, accounting for 28.5% and going down by 1.2% compared with last year, while the non-government-owned economy reached RMB 955.6 billion, accounting for 71.5% and going up by 1.2 % compared with last year. Among the non-government-owned economy, the individual private economy reached RMB 761.8 billion, accounting for 57% and going up by 1% compared with last year.

2. Location advantages:
On the southern wing of Yangtze River Delta, Zhejiang boasts its peculiar location advantages due to its geographically ¡°along rivers and seas, bridging the east and the west, and linking the south with the north¡±. The advantage is mainly embodied in four aspects:

Firstly, Yangtze River Delta is becoming the most vigorous and promising area in China¡¯s economy. Zhejiang, as part of the Yangtze River Delta, is no doubt to enjoy enormous opportunities. With the continual acceleration of the construction of international economy, trade, finance and shipping centers in Shanghai, its huge convergence and radiation capacities are supposed to directly push the Yangtze River Delta area to a sustainable and sound development.

Secondly, in view of the internal Yangtze River Delta, Zhejiang owns resources and advantages different from those in Jiangsu in the economic linkage with the central city, Shanghai. That is, the development of Jiangsu is principally ¡°along the river and road¡±. However, Zhejiang faces the sea and enjoys the peculiar ocean advantages, which is of great benefit for us to develop the ocean economy, global-market-oriented economy, near-harbor industry and logistics industry, etc.

Thirdly, a number of geographical factors encumbering Zhejiang from being connected with Shanghai and mingling into Yangtze River Delta in the past are now vanishing, and new advantages in some location factors are now becoming significant strength in the process of economic integration in Yangtze River Delta. For instance, the construction of cross-sea bridges will greatly shorten the economic distance between Zhejiang and Shanghai.

Fourthly, the process of economic integration in Yangtze River Delta is also the process of rise-up of city clusters in Yangtze River Delta centering on Shanghai. In the urbanization process, industrialization and informatization would inevitably follow. According to the international conventions, manufacturing industry will enjoy a prosperous development between the central city and nodal cities in a city cluster. This provides new opportunities for Zhejiang, the place located on the southern wing of Yangtze River Delta and in the intermediate/late period of the industrialization, to hammer out an advanced manufacturing base.

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