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Analysis: West China Full of Business Opportunities
The Chinese government's strategy of developing west China means new business opportunities for Hong Kong merchants, who are facing a more and more fierce competition in the coastal area of China.
"Central and west China, with about one-fourth of the national population, contains huge market potential," said Michael Sze Cho- cheung, executive director of Hong Kong Trade Development Council (TDC) at a seminar held here Friday on the development of China's west.
West China, especially Xi'an, the capital of Shaanxi Province, has rich scientific and technological resources, which are valuable for Hong Kong merchants to develop high-value-added products in areas like electronics, telecommunication and mechanical production, said Sze.
Xi'an is the third biggest scientific research base of China following Beijing and Shanghai in terms of the number of specialists and the technological level.
In Xi'an, there are about 20,000 software engineers, whose pay is less than half of that for their counterparts in the coastal area, working in the estimated 400 computer software companies, Internet companies and institutes for research of computer technology.
Hong Kong's capital, expertise, information and advanced business management and west China's advantage in technology and talents are highly complementary, said Wang Chunxin, economist of Bank of China.
Tourism is also a field with great development potential in this area, which boasts the ancient silk road and numerous scenic spots including terra-cotta figures in Xi'an, Mogao Grottoes of Dunhuang and the Potala Palace of Tibet.
Hong Kong merchants may invest in developing the tourist facilities or join the local tourist authorities to develop more tourist itineraries, said Sze.
He believed that China's imminent entry into the World Trade Organization and the further opening of its tourism will create more favorable conditions for Hong Kong merchants.
West China has rich natural resources like Chinese herb but has the problems of lacking capital, large-scale production capability and sale channels, while Hong Kong merchants are equipped with conditions to solve these problems, according to experts.
The authorities of west China attach great importance to developing Chinese herb. The Shaanxi and Gansu provinces are building a special zone with favorable policies aimed to develop the production of traditional Chinese medicine into a backbone industry.
Developing the vast area of west China is a significant policy to narrow the economic gap between various regions of China adopted after the implementation of the strategy of first developing the coastal area, Wang said.
"West China marks a new focus in China's economic development in the 21st century and means new room for Hong Kong investors," Wang said.
However, Wang urged the investors to pay attention to the differences between the conditions of west China and east China and to take corresponding strategy in participating in the west development to achieve further growth of Hong Kong's economy.
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