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Yangtze economic circle pilots "Common Policy"

(Xinhua)
Updated: 2007-12-04 17:15

Yangtze River Delta, China's first economic circle to pilot unified development planning, has made an initial breakthrough to cross administrative division among regional members.

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The economic cluster with Shanghai as the core and the two wealthy provinces of Jiangsu and Zhejiang as major developing polars issued joint governmental circulars giving equal market entry status to companies in the delta region Sunday.

Under the circulars coded as "Yangtze River Delta No. 1 and No. 2 Industrial and Commerce," the industrial and commerce authorities in Jiangsu, Zhejiang provinces and Shanghai made the first so-called "Common Policy" to allow free corporate share capital flow and standardized foreign company registration criteria and procedures.

The effort was soon acclaimed by the business sector. Kevin Nosbisch, vice president of finance and strategy of the General Mills International Greater China told Xinhua that over 60 percent of Haagen-Dazs' outlets in China are located in Shanghai, Zhejiang and Jiangsu. The unified market policy in the delta region would help boost the business.

The three heavyweight members in the Yangtze River Delta are both economic competitors and partners. Zhejiang's investment in Shanghai and Jiangsu, for example, has reached 200 billion yuan (US$27.03 billion) since 2000. It also recorded 40 billion yuan in contracted investment by Shanghai and Jiangsu.Competition for investment and duplicated construction of facilities under administrative protection has hindered the regional growth.

The delta area accounts for some 20 percent of China's total gross domestic product (GDP) and nearly 50 percent of foreign investment in China. There are over two million registered companies in the delta region, accounting for 23.8 percent of the national total.

"The 'Common Policy' has the common sanction in the three administrative regions. Meanwhile, an administrative liaison mechanism will be made by the industry and commerce authorities, so that the market regulators could meet once half a year to prompt the interactive policy planning," said Fang Huiping, director of the Shanghai Municipal Bureau of Industry and Commerce.

"The promulgation of 'Common Policy' is a breakthrough in the development of region-based economy. The cooperation across administrative division indicates a momentum for a higher level of unification in the Yangtze River Delta," said Yu Hongsheng, director of Shanghai Research Center of Urbanization Development.

The three members have recently signed a joint financing agreement with the People's Bank of China, China's central bank, in which they reached a consensus to coordinate in financing of important regional projects.

China's traditional economic growth is based on the administrative division of a province, while "region-based economy" presents a pattern based on similar or complementary economies of different regions.

After two decades of strong economic growth, economic clusters based on regions have taken shape in the Yangtze River Delta, the Pearl River Delta, the Beijing-Tianjin-Hebei circle, the west region, central China region, and the northeast industrial belt.


(For more biz stories, please visit Industry Updates)



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