Western China draws investors
Updated: 2012-09-26 09:03
By Li Jiabao and Li Yu in Chengdu (China Daily)
Underdeveloped region offers great potential, says NDRC official
China will channel more foreign investment into developing its western region while being more selective about what money it accepts, officials and experts said.
"In the next phase of developing the western region, the government will choose appropriate foreign investment rather than welcoming just any investment, as the eastern region did three decades ago," Fan Hengshan, head of the National Development and Reform Commission's department of regional economy, said during the 13th Western China International Fair, which is being held this week in Chengdu.
"The situation is different now and China has much higher capital reserves than before.
"Yet, the western region is the most underdeveloped in the country and thus will remain a top priority in work to bring balance to regional development."
Some of the strongest interest in the region is being shown by South Korean companies.
A manager from the Chengdu branch of Korea Development Bank said that local governments in the western region are now being more selective about which Korean investments they accept while investment opportunities in the coastal areas are becoming ever scarcer.
"As it works to boost western regional economies, the government will put a priority on places such as Chengdu, Chongqing and Beibu Bay in the Guangxi Zhuang autonomous region. Meanwhile, the least-developed areas will receive the greatest amount of assistance," Fan said.
The construction of infrastructure, especially that related to transport and water supplies, will remain a priority in plans to promote the economic development of the western region, he said. "Technological improvements will go along with the building of energy bases and ... the promotion of strategic emerging industries."
Lee Jae-yul, vice-governor of economy for Gyeonggi-do province in South Korea, said South Korean enterprises plan to invest more in service industries in China's western region.
"Samsung (Group) is now planning to make a big investment in Chengdu," Lee said.
He declined to give more details about the project.
In April, the electronics company agreed to spend $30 billion in Xi'an, Shaanxi province, to produce chips for memory cards and similar products.
"Following the series of investments by big enterprises, small South Korean companies, which are also good at research and development, have become interested in investing in China's western region and can provide support for large South Korean companies in the region," said Kim Geelyo, chief representative of the Gyeonggi Business Center's Shanghai office.
Chung Man-young, South Korean consul general to Chengdu, said South Korean companies will gain new vigor from investing in western cities that are rich in resources.
"As China's border trade increased by 14 times in the past 11 years, South Korean companies can take the region as an export base in addition to tapping the region's fast growing middle class," added Kim Chang-do, a senior business analyst with POSCO Research Institute.
Hu Mao, general manager for Hertz China, said the greater development of the western region will give Hertz business opportunities.
"We are planning to have more service stores in Chengdu, where we first established a branch in 2011," Hu said. "But the urgent thing is for the government to introduce a regulation for standardizing the emerging industry."
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