Post on 04-Dec-2023
transcript
Special Economic Zones and Development Zones in China
Liu XiaohuaConsultant from China Association of Development Zones
A pattern of multi-level all-around opening-up has been formed in China.
Special economic zones – 5Established along the southeast coast of China, adjacent to regions like Hong Kong, Macao and TaiwanEconomic and technological development zones – 200, and 1,800 provincial development zonesSet up in coastal port cities, provincial capitals, central cities and important industrial and commercial cities throughout ChinaHi-tech technological development zones – 89Set up in significant technological resources-based cities and emerging industrial cities across ChinaBorder economic cooperative zones – 15Established in important inland frontier port citiesSpecial customs supervision zones – 114Set up in important coastal and inland port cities (consisting of 12 bonded areas, 58 export processing zones, 14 bonded port areas, 28 comprehensive bonded zones and 2 cross-border industrial parks)
Strategic Objectives and Functional Orientation
1. Windows to show the opening-up of China
2. Test fields implementing the reform of economic system
3. Being modern cities and significant carriers cooperating with Hong Kong, Macao and Taiwan and promoting national unity
Special Economic Zones – Shenzhen, Zhuhai, Shantou, Xiamen and Hainan Province
Against the background of progressive reform of China initiated since the 1980s, the central government has taken policies and measures consistent with common international rules and different from those for other regions in China: 1. Granting the economic management authority at provincial level, including local legislative power, project’s examination and approval authority, power of personnel appointment and so on, thereby breaking away from the old system of high centralization. 2. Implementing preferential fiscal and tax policies:① The fiscal revenue of special zone is wholly or largely reserved within a certain period in place of the funds for infrastructure construction that should has been invested by the central government, so as to encourage the special zone’s government to accelerate development and increase revenue.
Special Policies and Flexible Measures
② Adopting 15% income tax rate (lower by more than 50% compared with the nationwide rate) for enterprises and implementing the preferential policy of “2-year exemption and 3-year reduction by half” in order to enhance the attraction for foreign businesses and investment.
③ Implementing special policy for customs tariff within a certain period to reduce or exempt import tariff.
3. Taking the lead to carry out the test of the system of market-oriented economy. Reform is first implemented in terms of product supply, merchandise pricing, employment system, employee recruitment, government functions, etc. as required by the system of market-oriented economy.
1. Demonstrating the national image of China with respect to the reform and opening-up and playing a positive role in the smooth return of Hong Kong and Macao and the promotion of peaceful reunification between mainland China and Taiwan.
2. Initiating the reform of the market-oriented system and conducting a beneficial exploration for the establishment of socialist market-oriented economy system.
3. Opening the window to the outside world and acting as a demonstration for the heavy use of foreign investment and the introduction of advanced technologies and management experience for 30 years throughout China.
4. The big modern cities rising one after another make local economy rapidly prosperous, change the situation of backwardness and play an important role in the stability and security of southeast coastal areas of China.
Achievements and Evaluation
1. Under the new situation of nationwide opening-up, the functional objectives of special zone need to be further defined.
2. The reform and opening-up of China is a continuously
deepened process, so how to reflect the tasks of experiment and demonstration that should be undertaken by the special zone?
3. The developments of special zones are unbalanced. Shenzhen serves as the model, Xiamen and Zhuhai come second, and Shantou and Hainan are still exploring the path to success.
New Problems Faced under New Situation
Strategic Objectives and Functional Orientation
1. Seizing the opportunity of international industrial transfer to
establish the platform for the acceptance of foreign
investment.
2. Expediting the economic and technological transformations
and industrial upgrading of cities and developing new and hi-
tech industries.
3. Increasing employment opportunities and driving the
development of urbanization by developing modern industrial
system.
Preferential Policies and Supportive Measures 1. Granting the economic management authority at provincial level, including local
legislative power, project’s examination and approval authority, power of personnel appointment and so on, thereby breaking away from the old system of high centralization.
2. Implementing preferential fiscal and tax policies: ① the fiscal revenue of development zone is wholly or largely reserved within a certain period in place of the funds for infrastructure construction that should has been invested by the central government, so as to encourage the development zone’s government to accelerate development and increase revenue. ② adopting 15% income tax rate (lower by more than 50% compared with the nationwide rate) for enterprises and implementing the preferential policy of “2-year exemption and 3-year reduction by half” in order to enhance the attraction for foreign businesses and investment. ③ implementing special policy for customs tariff within a certain period to reduce or exempt import tariff.
3. Taking the lead to carry out the test of the system of market-oriented economy. Reform is first implemented in terms of product supply, merchandise pricing, employment system, employee recruitment, government functions, etc. as required by the system of market-oriented economy.
Three Phases of Development
Phase of establishment
and exploration
1984 – 1991
Phase of expansion and growth
1992 – 2002
Phase of optimization
and promotion
2003 – till now
Basic Policies
2003 – 2010“Three Priorities,
Two Concentrations
and One Promotion”
1992 – 2002 “Three Priorities
and One Concentration”
2011 – till now“Three Equal
Stresses, Two Concentrations
and One Promotion”
Giving priorities to industry, foreign
capital and export; concentrating on the development of hi-
tech industries.
Giving priorities to improve the quality of foreign capital absorbed, developing modern manufacturing industry and optimizing export
structure; concentrating on the development respectively of hi-tech industries and high value-added services; promoting the transformation of development zone into multi-function
comprehensive industrial district.
Laying equal stresses on both advanced
manufacturing industry and modern service
industry, on the use of both foreign capital
and domestic fund and on both economic development and social harmony;
concentrating on the increase of
development quality and level and the
enhancement of the vitality of system and
mechanism; promoting the transformation of
development zone into industry-oriented multi-
function comprehensive
district.
Gathering place of foreign capital entering China Over the past 30 years, China has absorbed foreign
investment of nearly 1,300 billion US dollars in total, among which development zones amount to 45.34%, becoming the significant platform for China to successfully seize the opportunities of international industrial structure transfer for several times in the 30 years and realizing the leapfrog development strategy of China.
Main Functions and Achievements
Proportion of Development Zones’ Actual Foreign Capital Use in the National Total
Development zones
Distribution map of global top 500 enterprises in national economic and technological development zones
There were nearly 2,000 projects in total by the end of 2012.
Gathering zone of modern manufacturing industries
A large number of modern manufacturing industries at international advanced level are attracted, forming industrial clusters of electronic information, transportation equipment, electrical machinery and apparatus, biological medicine, chemical raw material and product, food and beverage, and so forth.
By the end of 2012, the industrial added value of national economic and technological development zones had been approximately RMB 3.8 trillion Yuan, taking up 19.17% in the total national industrial added value.
Base for hi-tech transformation Hi-tech and emerging industries: new energy, new
material, electronic information, biological medicine, energy conservation and environment protection, etc.
The output value of hi-tech enterprises realized in 2012 was 5,616.4 billion Yuan, accounting for 35.47% of total industrial output value and 56% of the national total.
Proportion of Output Value of Hi-tech Enterprises in Development Zones in the
National Total
Development zones
New example of modern service industry By the end of 2012, the added value of service industry had
reached RMB 1,238.907 billion Yuan, with an average annual growth rate of 31%.
Total output value of service industry
Growth rate
The industrial function of development zone is extended, the industrial restructuring promoted and the investment environment upgraded by developing the high value-added services.
A batch of gathering zones of modern service industry have been established currently, laying emphasis on the development of producer services like finance, logistics, research and development, commerce, law, consultation, accounting, etc.
International and domestic outsourcing businesses related to such services as research and development, technology, management, procurement, sales, operation, settlement and so on are undertaken. The number of service-outsourcing enterprises, the number of businesses undertaken and the turnover of offshore service outsourcing all increased rapidly in 2012.
Model of intensive land use A relatively high efficiency of land development and use is
maintained by following the rule of “overall planning to ensure that once a parcel of land is developed and completed, this parcel should generate profits”. By the end of 2012, the development zones, occupying a land area of 0.7% in China, had created 10%’s GDP, 19%’s gross export and 9.28%’s total tax revenue of the country.
With respect to the output efficiency per unit of land area in development zones, there are more than 90 enterprises established and put into operation per square kilometer at average; the average total industrial output value per square kilometer of the industrial land is 5.5 billion Yuan, the tax revenue generated is 0.23 billion Yuan, and nearly 9,000 jobs are created.
Demonstration zone of ecological industry Attaching importance to environment protection and resource
conservation and centering on the establishment of national industrial ecological demonstration parks, the development zones develop circular economy, advocate energy saving and emission reduction, propel industrial upgrading and play a demonstration role in building a resource-saving and environment-friendly society.
Through infrastructure construction and the utilization of energy-saving technologies for sewage treatment, sewage pipe network, solid waste disposal and so on, an average daily sewage treatment capacity of 5.25 million tons is achieved, the energy consumption per unit of GDP is 0.66-ton standard coal/ million Yuan, and the consumption of fresh water is 17m3/ million Yuan, lower than the national average.
Booster for China’s urbanization Planning layout The original park boundaries are broken for the development of
economy, technology and urban function in a larger range. Effect The radiation and driving effect of development zones is obviously
amplified, and the original function of economic and industrial development rapidly becomes the foundation for urban development, turning development zones into the important carrier for the accelerated development of “industrialization and informatization” in contemporary China’s modernization.
Cases Development of Pudong New Area driven by Jinqiao, Lujiazui,
Waigaoqiao and Zhangjiang; Construction of Binhai New Area and “Eco-city” supported by Tianjin
Development Zone; Construction of Science City, Knowledge City and Luogang District led
by Guangzhou Development Zone.
Creating the model of “park economy” with intensive development
The traditional industrial layout is changed, and the model of intensive development of land, environment, resource, production factors and industry is created, which is the new modern industrialized layout.
By the end of 2012, the development zones, occupying a land area of 0.7% in China, had created 10%’s GDP, 19.17%’s industrial added value, 19%’s gross export, 45.34%’s foreign capital actually used and 9.28%’s total tax revenue of the country.
Core competitiveness of economic and technological development zones
Policy supports from central and local governments,
administration simplification, decentralization, resource
inclination
Constructing infrastructure at high standards and
meeting industrial needs
Setting up simplified efficient administration system –
the administrative committee
Providing fine producer service
Defining functional orientation and selecting preponderant distinctive industries
Executing the management system combining government leading with market operation
Implementing the construction policy of overall planning and progressive development
Creating an investment environment where software matches with hardware
Insisting on taking the attraction for foreign businesses and investment as the key emphasis and core of work
Putting effort into innovation and continuously adjusting industrial structure and improving technological level
Paying attention to developing modern service industry, completing urban service function and promoting harmonious development of park
Basic Experience
Basic Experience Defining functional orientation and selecting preponderant
distinctive industries Executing the management system combining government
leading with market operation Implementing the construction policy of overall planning and
progressive development Creating an investment environment where software matches
with hardware Insisting on taking the attraction for foreign businesses and
investment as the key emphasis and core of work Putting effort into innovation and continuously adjusting industrial
structure and improving technological level Paying attention to developing modern service industry,
completing urban service function and promoting harmonious development of park
New Problems Faced under New Situation
1. Under current situation of sluggish world economy and domestic
economic transformation, how to ensure the development zones’ attraction for foreign businesses and investment?
2. Under the condition of numerous development zones in various provinces and regions, how to enhance coordination and integration in a bid to avoid industrial convergence and cutthroat competition?
3. How to harmoniously resolve the contradiction between development zones’ requirement for area expansion and the state’s control over land quota?
4. How to strengthen the economic and technological development benefits and the capability of independent innovation of development zones?