Special incentives to spur development in key areas
A view of a construction site of the Liaoning Hongguan Shipbuilding Co Ltd. The company now plays an important role in the province's shipping industry. |
As the relative emphasis of the nation's economic growth has shifted from the south to the north, the Bohai Bay Rim, which covers the coastal areas of Liaoning, is another area under the spotlight in China's development map.
Liaoning, the only province that enjoys coastal areas in Northeast China, has six cities Dalian, Dandong, Jinzhou, Yingkou, Panjin and Huludao along its 2290-kilometer coastal area.
Sources with the provincial government said that it will spend 6 billion yuan in building a road to connect all its coastal cities over the next few years, to help facilitate regional economic development.
The Liaoning provincial government has also outlined a series of preferential tax policies for foreign and domestic investors, in a bid to attract more capital flow into coastal economic development..
Based on 2005 statistics, 70 percent of all value-added tax, revenue tax, enterprise income tax, individual income tax and property tax levied on enterprises in the key five areas will be channelled back into infrastructure construction and supporting the building of leading industries.
The 11th deck of the Dandong Port is under construction. The deck will significantly enhance the handling capacity of Dandong Port. |
Moreover, new and high-tech domestic enterprises set up in the five key areas will be exempt from income tax for two years from the year they begin to make profits.
Further, the provincial small and medium-sized enterprise credit guarantee center will give priority to enterprises in the five key areas while providing bank loans and guarantees.
Provincial financial departments will also provide loan subsidies for technology renovation and service projects in the sector of equipment manufacturing, raw material processing, refined chemicals, agricultural product in-depth processing, textiles and pharmaceuticals.
Export-oriented processing enterprises in the five key areas will also enjoy preferential financial support policies.
In addition, all enterprises in these areas, including those already established and those in the pipeline, will be exempt from government administrative fees.
Since the strategy's initiation in 2005, Liaoning has seen rapid development in the five key areas.
The province earmarked nearly 5 billion yuan for infrastructure construction in these areas last year alone, developing a land area of more than 77 square kilometers.
The provincial government also approved 151 projects last year, with investment worth nearly 50 billion yuan.
Thirty-nine of these projects involve foreign investment, with contractual investment reaching 360 million yuan ($46 million).
Since the local provincial government has made great efforts to promote the strategy at home and abroad, "Five Points and One Line" has become a special term that is widely accepted.
Over the past two years, Liaoning provincial government has organized a series of promotional events at home and abroad, including South America, Japan, the Republic of Korea, Shanghai, as well as Nanning in South China's Guangxi Zhuang Autonomous Region, Shenzhen in South China's Guangdong Province and Hong Kong Special Administrative Region.
There was warm response also to investment promotion activities in Hong Kong Special Administrative Region, with many investment cooperation agreements signed there last year.
In addition, a number of top business and government officials from overseas have also visited the five key areas, to seek potential business and investment opportunities.
Top provincial government officials attach great importance to development and investment promotion under the "Five Points and One Line" strategy.
To date, the Liaoning provincial government has organized 13 special meetings for the implementation of the strategy.
Led by Li Keqiang, Party secretary of Liaoning, a group of entrepreneurs held three in-depth discussion sessions with the president of the STX Group from the Republic of Korea in a bid to enhance business cooperation with the company.
A number of large investment projects are currently in operation in the area.
For example, the project of MCC Jingcheng Machinery Equipment Co involving investment of 9.97 billion yuan has recently been kicked off.
At present, 186 projects with a total investment value of 200.9 billion yuan are being discussed with both local and foreign investors.
In addition, the province has enhanced the coordination between different government departments, optimizing the investment climate for investors at home and abroad.
Sources from the Liaoning provincial government said that the China Development Bank has pledged to provide 30 billion yuan to support the infrastructural development of the area.
(China Daily 03/07/2007 page17)
