Overview of Shenzhen Foreign Investments Environments

Introduction

(1) Economic Scale Advantage

Shenzhen Special Economic Zone is the first special economic zone whose establishment was initiated and promoted by Deng Xiaoping, the chief designer of Chinese reform and opening. As an experiment for promoting the development of economic and social development of China, Shenzhen has obtained great success. Shenzhen has formed a characteristic economy featuring high-tech industry, logistics, finance and information services. Various social causes have enjoyed simultaneous development and a market economy system has been increasingly perfected. Shenzhen has set an example to the whole country and played a role of example and promotion. In 2002, its GDP reached 223.941 billion. Its total import and export amount was USD 87.1 billion, including an export value of USD 46.52 billion. Its total industrial output value was RMB 422.1 billion. The output value of high-tech industry accounted for 46% of the total industrial output value. By the end of 2002, the accumulated amount of foreign capital actually utilized reached USD 31.519 billion.

(2) Geographical Advantage

Shenzhen is located at the forefront of the Pearl River Delta and borders on the New Territories of Hong Kong in the south, Daya Bay in the east, the outlet of Pearl River and Dongguan and Huizhou in the north, being an important coastal communication hub in South China. Shenzhen is the only city that owns seaports, airport and land ports in China. Its seaports are especially developed. The Shenzhen Port ranks sixth among world container ports. Shenzhen owns Luohu Port, the largest land passenger port in China and Huanggang Port, the largest land freight port. At the same time, Guangshen, Shenshan, Jingjiu and Guangshen expressways link Hong Kong, Shenzhen and inland cities. 24-hour customs clearance practiced by Shenzhen and Hong Kong ports, electronic inspection and release and the commencement of construction of the West Bridge will make Shenzhen and Hong Kong connected more closely. The regional advantages of Shenzhen will be further highlighted and the economy of both Shenzhen and Hong Kong can further thrive. Besides, Shenzhen is a bridge linking Hong Kong with inland area and linking inland area with the world.

Supporting Industry Advantage

Shenzhen is a production base, R&D base and transaction base of high-tech products including computer and parts, communication equipment, audio visual products, optical and electromechanical products, biological engineering products, etc. Shenzhen has over 1500 factories producing supporting parts of computer, which produce almost all computer parts except chips. Their annual supporting ability is over 30 million sets. There are over 30 million lines for communication and exchange. Shenzhen has become an electronic supporting center in mainland China. China International High-tech Result Fair is held in Shenzhen once every year.

(3) Immigrant Culture Advantage

There is a saying in China that the world is won with culture. Shenzhen is a newly emerging immigrant city. Its culture is different from the traditional culture of other cities. It is the transformation and activation of inland culture and the absorption and fusion of foreign culture oriented toward Hong Kong. Unique geological and cultural environment of Shenzhen has created Shenzhen culture featuring openness, tolerance and innovation.

Invest Direction

(1) High Technology

Shenzhen focuses on developing the industries of computer and parts, very large-scale integrated circuit, network and communication, software, photoelectron, digital electrical household appliances, biological engineering, new material and environmental protection and renovates traditional industries by making use of high technology and advanced applicable technologies.

(2) Logistics Business

Shenzhen encourages the development of port supporting facilities, multi-modal container transport, modernized warehousing area, international express distribution centre, logistics park, whole-course logistics network, distribution and delivery center, chain operation network and city light rail facilities.

(3) Finance Industry

Shenzhen fosters the development of securities, insurance and banking industry and the establishment of foreign-invested companies engaged in financial consultation, trust investment, finance, fund management, venture investment and venture investment management.

(4) Tourism Industry

Shenzhen focuses on developing modern tourism industry integrating recreation, culture and ecology.

(5) Other Fields

Investment in traditional industries including important infrastructure, refined chemical industry, automobile parts, clocks and watches, jewelry, leather, furniture and garment and establishment of high-class joint venture hospitals, international schools and other projects.

Industrial parks

(1) High-Tech Industry Zone

The high-tech industry zone includes Shenzhen Front Sea Area, Shenzhen High-tech Area, Liuxian Cave Area, Shiyan Area, South Guangming Area, Guanlan – Longhua – Banxuegang Area, Baolong Area, Great Industrial Area, Kuichong – Dapeng Area, Shenzhen University City Area and Ecological Agriculture Area. The total length of high-tech industry zone is around 100 km. The total planned land area is around 158.5 square kilometers. The area of land available for development is around 100 square kilometers. The area of land for high-tech industry is around 50.9 square kilometers. It has five functions: scientific research and development, incubation of scientific and technological results, industrialized production, higher education and export processing.

(2) High-Tech Area

The total planned land area is 11.52 square kilometers. The area of land for high-tech industry is 3.3 square kilometers. It will focus on the development of electronic information industry and quicken the development of three industries, i.e., biological medicine, optical electromechanical integration and new material.

(3) Liuxian Cave Area

Its total land area is 3.2 square kilometers. This area focuses on the development of integrated circuit, communication equipment and relevant industry.

(4) University City Area

Its total planned area is 3.8 square kilometers. The area of the land available for development is 2.1 square kilometers. In the initial stage, it introduced many famous domestic universities including Tsinghua University, Peking University and Harbin Institute of Technology and over 6 state-level key laboratories and established multifunctional, comprehensive and modernized university science and education area integrating production, learning and research.

(5) South Guangming Area

Its total planned area is 28.31 square kilometers. The area of land available for development is 15.05 square kilometers. The planned area for high-tech industry development is 6.0 square kilometers. It focuses on the development of electronic information, digital display, optical electromechanical integration industry and large-scale advanced manufacturing industry.

(6) Baolong Area

Its total planned land area is 31 square kilometers. The area of the land available for development is 21.1 square kilometers. The area of land for high-tech industry is 11.2 square kilometers. It focuses on the development of digital display, new material, new energy and relevant supporting industries and large-scale advanced manufacturing industry.

(7) Ecological Agriculture Area

Its total area is 1,866.7 hectares (including sea area of 500 hectares). Guangming Area mainly develops modern urban high-tech agriculture. Gongming mainly develops modernized production of high-quality pollution-free vegetable, high-quality fruits and various flowers. East Ocean Area is mainly planned for a comprehensive marine product culture, export & import and ocean resource development base integrating the scientific research and production of marine organism and touring.

(8) Municipal Grand Industrial Area and Export Processing Zone

Planned area of the Municipal Grand Industrial Area is 174.4 square kilometers and development area for the central zone shall be 38 square kilometers. The area focuses on high-tech industries as well as industries involving advanced technologies and supporting tertiary industries, including finance, real estate, commercial services and economic and technical development.

Shenzhen Export Processing Zone is a special closed area supervised by the customs with the approval of the State Council. The Processing Area is the west part of phase-I development zone of the Great Industrial Area, covering 3 square kilometers. The municipal government plans the Processing Area for one of key bases of foreign trade and earning of foreign exchange by export.

(9) Municipal Bonded Areas

Futian, Shatoujiao and Yantian Port Bonded Areas are three bonded areas in Shenzhen. Bonded areas practice bonded customs supervision and control system and can establish foreign-invested trading companies and conduct bonded warehousing and exhibition business. They do not practice the cancellation of exchange collected for export and paid for import after verification. The self-use equipment of the enterprises in these bonded areas is tax-free.

The geographic conditions of the bonded areas are superior. Futian Bonded Area has special passage for connecting with Hong Kong. Shenzhen Yantian Port Bonded Area is close to Yantian terminal.

Futian Bonded Area covers 1.35 square kilometers and focuses on developing high-tech industries and logistics industry. Shatoujiao Bonded Area covers 0.27 square kilometers and focuses on the development of export processing of computers, toys, jewelry and gold. Yantian Port Bonded Area covers 0.85 square kilometers and focuses on logistics industry.