A bonded zone in Jinan, capital of Shandong province, has become a hot destination for investment since the State Council approved it as the nation's 21st comprehensive bonded area in May.

"The zone, the first of its kind in the province's central and western regions, will be of huge importance in promoting Shandong's export-oriented economy and deepening the opening-up of these inland areas to the outside world," said Li Shixin, deputy director of the zone's administrative committee.

Neighboring Jinan High-tech Industrial Park, the zone covers a planned area of 5.22 square kilometers and has easy access to urban transportation. It is only 18 kilometers away from an international airport and sits beside a number of highways that link it to major metropolitan areas, such as Yantai, Qingdao and Beijing.

"The comprehensive bonded zone, which functions just like a port, is one of the most open areas with the most preferential policies," said Li.

Enterprises in the zone can enjoy a number of preferential policies in terms of taxes, investment, financing and land use, such as exemption of duties for foreign goods and tax refunds for domestic good. Also, no value-added taxes or consumption taxes are required while trading within the zone, Li added.

"Before the zone was established, the local export-oriented companies had to transport goods first to customs offices in the neighboring coastal cities, which are at least a four-hour drive away. Now they can do the business at the customs office in the zone, which will largely save time and cut costs for them," Li said.

Thanks to these policies, more than 80 well-known domestic and foreign enterprises have already invested in the zone, including the Volvo Group, the Inspur Group and China National Heavy Duty Truck Co Ltd.

They mainly focus on sec-tors of export-oriented processing, international logistics, advanced manufacturing, service outsourcing, biomedicine, international finance, exhibition and trade.

An integrated circuit industrial park involving a total investment of 5 billion yuan ($803 million) from the In-spur Group is under construction. Upon completion next year, it is expected to produce 600 million advanced chips annually and generate 10 billion yuan in sales revenue.

An exhibition area to showcase global products, including high-end wine, imported food, luxury bags and cosmetics, will soon be completed.

Other projects currently under way also include a 210,000-square-meter national research base for new drugs and biomedicines, an 830-million-yuan bonded logistics park, and a 350,000-square-meter business incubation center.

"We will do our best to ensure the smooth execution of these projects and will provide a sound business environment and all services necessary to the investors," Li said.

Five years from now, the number of companies in the zone is expected to reach 500, which are projected to generate annual sales of 120 billion yuan and foreign trade worth $20 billion.

wangqian2@chinadaily.com.cn