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Economy

Zoning in on success

By Zhang Yuchen in Guangdong, Wei Tian in Fujian and Huang Yiming in Hainan, with Li Yao (China Daily)
Updated: 2010-08-19 09:05
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Paint boss hails fantasy island

HAIKOU - Feng Pingjun followed his uncle from Zhejiang province to do business on the island of Hainan in 1989.

Then 18 years old, he arrived in the capital of Haikou to find a city in a relatively "shabby and desolate" state, with only a handful of buildings higher than eight stories. Today, he is the proud owner of Haikou Zheqiong Coating.

Zoning in on success

Factory owner Feng Pingjun is one of the beneficiaries of the boom times in Hainan. Huang Yiming / China Daily 

"Back then, people in Hainan had no idea what coating was," said Feng, who started the company with his uncle after spotting a gap in the market. "Lime plaster was used to paint walls."

When Hainan province was established as a special economic zone (SEZ) in 1988, the island received a massive influx of labor, goods and capital. Its property sector boomed and more than 5,000 companies set up headquarters there.

Thanks to the rapid growth in the property market, coating quickly became a lucrative business.

It was not all easy sailing, though. Feng and his uncle initially run up a debt of 100,000 yuan ($15,000). Raw materials had to be imported from other parts of the country, while poor transportation links also caused constant problems. However, with little competition, their business was soon thriving.

In 1996, Feng took full control of the factory and increased daily production to three tons. Improved transport links since 2000 have also enabled him to buy in bulk, pushing output to eight tons, he said.

Haikou Zheqiong Coating has experienced every high and low of China's developing economy. Real estate bubbles and a lack of market regulations led to a bleak situation in the early 1990s, when the city was dotted with more than 16 million square meters of unfinished construction projects.

The recession hit the interior decoration materials market in 1994 but Feng said his company weathered the storm thanks to good management and his door-to-door sales skills.

In 1999, the State Council used the province's SEZ status to launch broad policy adjustments to deal with the oversupply of real estate. The move attracted companies from home and abroad to Haikou and the southern city of Sanya.

"Since 2000, the government began to remodel the unfinished buildings into new squares and skyscrapers," said Feng. "As a result, Hainan's decorating materials market flourished. Employees began to work overtime on large orders and I don't have to knock on people's doors any more."

This year, Hainan authorities also announced the island is gearing up to become an international tourism destination.

"We're getting busier and busier," added Feng. "The market demand is immense. People are earning more and the houses built in rural areas are more sophisticated. They are going to need more decorating materials."

 

More SEZ stories:

Driving force behind the rise

Father laments the end of quiet lifestyle

Working toward a good environment, not economy

A metropolis built on rolling stones

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