[photopress:zones_map_showing_hunan.jpg,full,alignright]An example of the zone development in Hunan province: Xiangtan High-Tech Industrial Development Zone was established in 1992 and is a key provincial level high-tech zone with a planned area of 25 km2. (The illustration at the end shows the extent of the place.)
The accumulated investment from the high-tech zone has reached RMB20 billion and the developed area has reached 6.9 km2.
There are now 240 industrial enterprises including 103 high-tech enterprises. The total income from technology, industry and trade was RMB 36 billion.
Then, in December 2007, three cities within the province — Changsha, Zhuzhou and Xiangtan — were officially named ‘national pilot zones for developing an environment-friendly and a resource-saving society’.
This coincides neatly with financial reasons to open in a third-tier city. Escalating costs for both land resources and labor mean companies in the Yangtze River and Pearl River deltas are increasingly looking to the middle and western regions.
An annual survey from the American Chamber of Commerce in Shanghai shows US investors in China are facing rising costs in terms of salaries and wages, real estate, distribution and transportation.
As a result, about 5.5% of the companies surveyed say they are already investing in inland provinces, and over 36% say they would set up operations in second- and third-tier cities and interior areas.
[photopress:zone_xian_development_zone.jpg,full,alignleft]Gan Lin, vice-governor of Hunan province, said, ‘Business costs in Hunan are 30% lower than in the coastal areas.’ He said over 40 of the world’s top 500 companies have already set up their operations in Hunan.