Page 86 - 2018 Special Report on the State of Business in South China
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· In 2016, regional GDP totaled RMB1.961 trillion, procedures for PE funds that intend to apply for financial
ranking third in the country, trailing Shanghai and Beijing. support from the PEDF. Incentives offered to PE funds
include: rewards for local financial contributions, office
· Among the highest in the country, average purchase and rental subsidies, one-time settlement
monthly wages in Guangzhou grew to RMB7,425 in rewards, and one-time rewards for investment
2016. Guangzhou’s monthly minimum wage rose by withdrawal.
22.3 percent from RMB1,550 to RMB1,895 in 2015 –
the second highest in the province behind Shenzhen. E-Commerce Promotion
Meanwhile, the city’s minimum hourly wage increased
from RMB15 to RMB18.3. In September 2009, Shenzhen was approved by
China’s NDRC and Ministry of Commerce (MOFCOM)
Guangzhou’s strength in foreign trade is evident in the to become China’s first “e-commerce model city”. In
following figures (from Guangzhou Statistical Report 2016): addition to streamlining registration processes for
e-commerce companies, the city has made other efforts
· Total exports rose by three percent year-on-year to to promote the development of e-commerce. One
RMB518.7 billion example is the building of dedicated industrial parks,
such as Futian International E-commerce Industrial
· Guangdong realized an import value of RMB337.99 Park, which opened in 2009 and houses more than 150
billion, increased 3.3 percent since last year. internet and e-commerce companies.
In particular, trade between Guangzhou and newly Qianhai Shenzhen-Hong Kong Modern
emerging markets, including Latin America, the Middle Services Cooperation Zone
East and Africa, has increased greatly in recent years.
One state-level project being developed in Shenzhen
Spotlight on Shenzhen Government is the Qianhai Shenzhen-Hong Kong Modern Services
Innovation Cooperation Zone, approved by the State Council in
June 2012. By the end of March, 2017, around 133,000
Shenzhen’s government has taken the lead on a companies with a combined registered capital of
number of new initiatives to become the national RMB4.839 trillion had already registered in the zone.
leader in innovation and private enterprise growth. The As a JV between Hong Kong and Mainland China, and
city has experienced rapid private economic growth, supported by the State Council, the Qianhai Zone is
spawning about 1,083,063 private companies, including designed as an experimental business zone for better
international giants such as Huawei Technologies Co., interaction between the two jurisdictions’ financial,
Ltd., Tencent Holdings Ltd, China Vanke Co., Ltd., and logistics, and IT services sectors. It covers slightly less
BYD. Available incentives include a recent VAT exemption than 20 square kilometers on the western side of
policy and a 50 percent CIT exemption for qualified small Shenzhen, and is expected to achieve a GDP of RMB150
and micro-sized enterprises. The government has also billion by 2020.
adopted specific measures in terms of equity investment
incentives, e-commerce promotion, and the introduction Among its many goals, the Qianhai Zone will serve
of electric vehicles. Lastly, as part of a pilot program as a pilot area for the liberalization of China’s financial
to curb emissions of key pollutants and clean up the sector as a whole, including preferential policies such as:
environment, foreign investors are now permitted to
trade carbon permits in Shenzhen. · Allowing the Qianhai Zone to explore the
expansion of offshore RMB flow-back channels, and
Equity Investment Incentives establish an innovative experimental zone for cross-
border RMB transactions;
Private equity (PE) investment has emerged as one
of the most important capital-raising avenues for small · Supporting the granting of RMB loans for offshore
and medium-sized enterprises. Recognizing this, the projects by banking institutions established in Qianhai;
Shenzhen government has become one of several
coastal city administrations to offer further incentives to · Under the CEPA framework, conducting studies
equity investment enterprises. The city has established on the granting of RMB loans by Hong Kong-based
a PE Development Fund (PEDF) and clarified operation
86
ranking third in the country, trailing Shanghai and Beijing. support from the PEDF. Incentives offered to PE funds
include: rewards for local financial contributions, office
· Among the highest in the country, average purchase and rental subsidies, one-time settlement
monthly wages in Guangzhou grew to RMB7,425 in rewards, and one-time rewards for investment
2016. Guangzhou’s monthly minimum wage rose by withdrawal.
22.3 percent from RMB1,550 to RMB1,895 in 2015 –
the second highest in the province behind Shenzhen. E-Commerce Promotion
Meanwhile, the city’s minimum hourly wage increased
from RMB15 to RMB18.3. In September 2009, Shenzhen was approved by
China’s NDRC and Ministry of Commerce (MOFCOM)
Guangzhou’s strength in foreign trade is evident in the to become China’s first “e-commerce model city”. In
following figures (from Guangzhou Statistical Report 2016): addition to streamlining registration processes for
e-commerce companies, the city has made other efforts
· Total exports rose by three percent year-on-year to to promote the development of e-commerce. One
RMB518.7 billion example is the building of dedicated industrial parks,
such as Futian International E-commerce Industrial
· Guangdong realized an import value of RMB337.99 Park, which opened in 2009 and houses more than 150
billion, increased 3.3 percent since last year. internet and e-commerce companies.
In particular, trade between Guangzhou and newly Qianhai Shenzhen-Hong Kong Modern
emerging markets, including Latin America, the Middle Services Cooperation Zone
East and Africa, has increased greatly in recent years.
One state-level project being developed in Shenzhen
Spotlight on Shenzhen Government is the Qianhai Shenzhen-Hong Kong Modern Services
Innovation Cooperation Zone, approved by the State Council in
June 2012. By the end of March, 2017, around 133,000
Shenzhen’s government has taken the lead on a companies with a combined registered capital of
number of new initiatives to become the national RMB4.839 trillion had already registered in the zone.
leader in innovation and private enterprise growth. The As a JV between Hong Kong and Mainland China, and
city has experienced rapid private economic growth, supported by the State Council, the Qianhai Zone is
spawning about 1,083,063 private companies, including designed as an experimental business zone for better
international giants such as Huawei Technologies Co., interaction between the two jurisdictions’ financial,
Ltd., Tencent Holdings Ltd, China Vanke Co., Ltd., and logistics, and IT services sectors. It covers slightly less
BYD. Available incentives include a recent VAT exemption than 20 square kilometers on the western side of
policy and a 50 percent CIT exemption for qualified small Shenzhen, and is expected to achieve a GDP of RMB150
and micro-sized enterprises. The government has also billion by 2020.
adopted specific measures in terms of equity investment
incentives, e-commerce promotion, and the introduction Among its many goals, the Qianhai Zone will serve
of electric vehicles. Lastly, as part of a pilot program as a pilot area for the liberalization of China’s financial
to curb emissions of key pollutants and clean up the sector as a whole, including preferential policies such as:
environment, foreign investors are now permitted to
trade carbon permits in Shenzhen. · Allowing the Qianhai Zone to explore the
expansion of offshore RMB flow-back channels, and
Equity Investment Incentives establish an innovative experimental zone for cross-
border RMB transactions;
Private equity (PE) investment has emerged as one
of the most important capital-raising avenues for small · Supporting the granting of RMB loans for offshore
and medium-sized enterprises. Recognizing this, the projects by banking institutions established in Qianhai;
Shenzhen government has become one of several
coastal city administrations to offer further incentives to · Under the CEPA framework, conducting studies
equity investment enterprises. The city has established on the granting of RMB loans by Hong Kong-based
a PE Development Fund (PEDF) and clarified operation
86
