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Journey to the west

By Cong Mu (Global Times)

08:06, May 07, 2012

China's efforts to develop its western regions has helped create booming economies in some areas and high-level businessmen from home and abroad are joining the rush for profits.

One of them is Michael McErlean, 51, a former executive director at Goldman Sachs, who moved to Chengdu, capital of western China's Sichuan Province, last year with his wife and two children.

After more than 20 years at Goldman, McErlean now serves as CEO of ELI Hollyhigh International Capital, a local merger and acquisition advisory firm in Chengdu.

"It's amazing how many overseas firms are here, and more are coming every week, it seems. You can't name a Western technology company that's not here. Whether it's Siemens, Motorola, Hewlett-Packard, Intel, Apple - you name it, they're here," McErlean told the Global Times last month in his office near the downtown Tianfu Square.

"For the last 10 years, the government has pushed a 'Go West' policy. I know this part of China is exploding. This is a growing area, whereas Beijing and Shanghai would have been wonderful places in 1992 rather than 2012," he said.

Financial services grow

Chengdu's GDP grew by 15.2 percent year-on-year in 2011, one of the fastest growth rates in the country. And as the local economy expands, financial services such as ELI Hollyhigh are also growing in the city.

Financial institutions contributed 54.8 billion yuan ($8.7 billion), or 8 percent, to the local GDP in 2011, according to the Chengdu Finance Office under the city government.

Australia and New Zealand Banking Group is going to build a high-end back office center in Chengdu to support its global operations, Brian Squires, managing director of a local subsidiary of the Australian financial services company, told the Global Times at an investment forum in the city last month.

Chengdu is hoping to attract more such back offices as part of its effort to turn itself into a financial hub in western China, Liang Qizhou, deputy director of the Chengdu Finance Office, told the Global Times in his office in a newly built financial industrial park in the south of the city.

"Because back offices are not independent units, we thought we wouldn't benefit from allotting them our very cheap land. We thought they wouldn't contribute much to our economy," Liang said.

"But we worked out that if we can draw the back offices to come, then many financial services outsourcing companies such as software and accounting firms that serve them will follow," Liang said.

"In the future, China will need financial centers that are quite different from what they have been historically. To enable a consumption-driven model, financial centers in Chongqing, Chengdu and elsewhere will need to focus primarily on creating higher levels of prosperity for the Chinese population," Thierry Delmarcelle, president of Monitor Group China, the Chinese subsidiary of US consulting firm Monitor Group, told the Global Times last month.

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