City emerging as IT hub

(China Daily)
Updated: 2010-11-05 11:14
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Editor's note: As more and more technology companies move to Chongqing, the city tries to build itself into a major IT hub in China. China Daily reporter Wang Ying talks with Mu Huaping, director of the Chongqing economic and information technology commission.

Q: Compared with other cities, what is Chongqing's advantage in developing the IT industry?

A: Chongqing is entering a new phase of economic development. For many years, coastal cities enjoyed an advantage in drawing in investment and outsourcing orders because of its convenience to overseas markets. But as the cost for labor and raw material continues to rise in recent years, the inland municipality of Chongqing has emerged as the next destination for manufacturing and outsourcing.

Compared with its coastal counterparts, Chongqing's cost of labor and water, electricity and natural gas is nearly 30 percent lower.

The development of the IT industry cannot succeed without convenient transportation. Therefore, while putting a lot of focus on industrial development, Chongqing is also ready for delivering products to consumer markets, domestic and overseas, via air, land and sea.

A second airport runway of 3,600 meters will be in operation in late December, making Chongqing's Jiangbei (International) Airport the only inland airport with two runways. The construction of a third runway will break ground in 2011 - the 3,800-meter long runway will be able to accommodate an Airbus 380.

A direct air cargo service between Chongqing and the Belgium city of Liege was launched in late September, and this is expected to help build closer ties between the fast-growing high-tech production center of Chongqing and the important electronics consumer market of Europe.

The completion of the 11,179-kilometer-long Euro-Asian continental bridge will help satisfy the rising demand of imports for high-tech products from European countries, and that will save as many as 14 days from the traditional transport shipping by sea. The bridge starts in Chongqing, goes through Xi'an, Lanzhou, Urumqi, Kazakhstan, Russia, Belarus, Poland, and winds up in the German city of Duisburg.

Last, but not least, a special railway route has been dedicated to transporting goods from Chongqing to Shenzhen's Yantian Port beginning this May. The railway route along with the sea route starts from Yantian Port and it takes laptops manufactured in Chongqing 27 days to reach European countries, instead of the usual 40-day trip. And the railway plus sea route will deliver goods from Chongqing to Europe two days quicker than products delivered from Shanghai.

All these routes make Chongqing's deliveries less time consuming and that is a deciding factor for products.

Q: It was reported that Chongqing could turn into China's version of Silicon Valley. Can you explain the city's plans?

A: The US' Silicon Valley grew up around the Stanford (University) campus, and it was developed by the university and its graduates, while Chongqing's municipal government has developed the IT industry.

The similarity between the Silicon Valley and Chong-qing's IT park is that they are both situated near colleges. Being the only municipality in China's inland, Chong-qing has a population of more than 30 million and an abundance of talent. There are 57 universities and more than 700,000 university students in Chongqing, and the 341 professional schools' 210,000 graduate students every year provide a sustainable talent pool for the city's IT industry.

Our goal is to expand Chongqing's IT industry into the size of 1 trillion yuan ($149 billion), accounting for 40 percent of the city's total industry size of 2.5 trillion yuan in 2015. By then, Chongqing will be able to produce 80 million units of laptops, between 20 and 30 million printers, and 50 million cell phones.

Chongqing is going to become China's major electronic product center.

Q: What influential companies have Chongqing attracted so far?

A: Actually, a much-improved infrastructure and the city's high-tech hardware have attracted big names to build production bases there, such as Hewlett-Packard, Foxconn, Cisco and Inventec. Currently, the city receives about 40 million notebook orders each year and its production volume will rise to 80 million in three years.

Q: How would Chongqing's IT industry enhance the overall development of western areas?

A: The development of Chongqing will sufficiently drive the overall economy of the western region. We not only have the resources to build Chongqing into an outsourcing center, but also make it into a complete IT industry chain. In the future, up to 80 percent of laptop-related products will be able to be manufactured in Chongqing.

It is impossible to have all the companies built within the city so less technology concentrated companies will be located in surrounding cities. Branches of the big companies will spread to nearby areas and later penetrate into the whole western area.

Q: What's Chongqing's goal in IT development?

A: The IT industry of Chongqing is valued at 15 million yuan and will grow at an annual rate of 20 and 30 percent. Between 2011 and 2015, Chongqing will invest another $10 billion into the IT industry, and the city's total value of the IT industry is expected to reach $100 billion by 2015.