The World Bank has tagged the fast-rising city of Chengdu as the benchmark city for investment in inland China. At present, 13 of the world’s 20 best software enterprises are now in Chengdu.
Chengdu attracts foreign investors to build their businesses in the city because of four critical factors that include talented workers, friendly government policies to foreign investors, convenient and high-speed transportation and a comfortable lifestyle.
Chengdu, known as one of the famous software cities in China, gives importance to the development of its high-tech industry. The Chengdu Hi-Tech Industrial Development Zone (CDHT), a hub of investments in the city, produces more than half of the iPads and 25 percent of laptops, apps and other technological innovations. More than 300 companies, such as Motorola, Nokia Siemens, Huawei and ZTE, are also registered here.
Figures show Chengdu’s total revenue from software development and information technology services increased 35 percent year-on-year to 180 billion RMB, and contributed over 6 percent, or 300,000 billion RMB, of the city’s gross domestic product.
Since 2007, the government invested around 200 billion RMB for the software industry and service-outsourcing industries to support its development. Enterprise incometax reductions, value-added tax rebates and business-tax exemptions are just a few of the tax breaks the Chengdu city government offers.
Software revenue rose from 6.6 billion RMB in 2003 to 86.3 billion RMB in 2010 and keeps growing as Chengdu continues to attract attention from foreign investors. Chengdu also ranked 40th on the list of the top 100 outsourcing cities in the global service outsourcing sector and was the first city in West China to make it to the list.
It has also become the thirdlargest host city to foreign consulates in China. The sister cities include those in the Netherlands, Oceania, France, South Korea and Japan. The Philippines, however, is just starting to build a relationship with Chengdu.
Rep. Ferdinand Martin Romualdez of the First District of Leyte and the local government of Tacloban expressed deep interest in building a relationship with Chengdu, such as exchanging postdisaster-reconstruction experiences, for example. The talks are still ongoing and, should this push through, it will be the first sister-city relationship between the Philippines and China. The electronic information industry, on the other hand, is booming, as well. The enterprises that passed certification by the Ministry of Technology and Information Technology numbered only around 454 in 2006 but has doubled to 839 in 2010. Electricity consumption is not a problem in the area, as 60 percent to 80 percent of power comes from hydropower resources and the government provides subsidies to support the system.
Thomas Tang, director of the Strategic Development Planning Bureau of CDHT, at the news briefing said loyalty among the work force is high due to high salary packages but low taxes. The city’s workers are mostly composed of engineers, technicians and software developers. He also said Chengdu finds Filipino software developers very good at their field of expertise. Asked if Chengdu is open to train foreign workers such as Filipinos, he said, “We are also willing to share and we hope that we could also bring benefits to our neighbors, including the Philippines…we can share experiences and we learn from each other.”
Special to the BusinessMirror