The Yangtze River Delta, a Chinese El Dorado
Author: Tim Lyons

Yangtze River Delta (YRD) is a compound area consisting of
15 above-district cities in Jiangsu, Zhejiang Provinces and
Shanghai city. If you are already in China, you must have
new names of cities, which are buzzing in your ears,
nourishing business debates with peers and both economical
and urban development discussions. They are Hangzhou,
Suzhou, Nanjing, Ningbo... and they will most probably make
their international media breakthrough in the years to come.

Always marching towards economic integration, the YRD bares
the fastest economical growth, and the delta is recognized
by the world, as one of the top 6 city strips. Among the 35
cities with the strongest economy, 10 are in the Yangtze
River Delta, while half of the top 100 counties with
strongest comprehensive strength are also in this delta and
4 reach the top 10. Let's quickly focus on strategic
aspects of this region, which are symbols of the YRD's
exponential development, International business hub status
and future prosperity.

First of all, let's look at some facts regarding
infrastructure and transportation. To give you an idea, it
is in this relatively small area (compared to the whole of
China) that 20% of the total Chinese population commute
daily on 15% of China's total expressways. Mentioning also
Shanghai's status of largest cargo port worldwide (Ningbo's
standing in 4th position) and managing the heaviest air
traffic flow in China. This highly developed infrastructure
contributes to people, as much as goods, and we will see
that trade related figures are mind-blowing when taking a
close look to the YRD. In terms of investments, the 4.5
billion USD Maglev project (fast train) linking Hangzhou to
Shanghai speaks for itself. As the most expensive
infrastructure related investment ever approved by the
Chinese government, the YRD demonstrates once again its
attractiveness to public and private investors. Moreover,
Hangzhou's Bay Bridge finished mid 2008 has become the
world's longest sea-spanning bridge, with an investment of
another few billion dollars. With such incredible
infrastructure projects, the Yangtze River Delta area aims
to be sixth largest urban zone following Paris, London, New
York, Tokyo and Chicago.

To all businessmen that we are, nothing speaks better than
clear economic facts; GDP, FDI, trade figures, all of which
highlight this region's attractiveness. The GDP of the YRD,
to start, has been growing on an average of 14.7%,
accounting for almost a fifth of China's total GDP in 2007
(RMB 20.94 trillion). As one of the growth engines of the
region, Shanghai can celebrate 15 years of double-digit
growth rate, while in the meantime, the Jiangsu province
takes over the second place in terms of largest provincial
economy (following closely Guangdong province) benefiting
from a GDP (124 Billion USD in 2006) growth rate with 5
percentage points more than the national average (15.4%).
Zhejiang privileged economic position has brought it up to
having the highest provincial income per capita in China,
with the province's GDP growing by 14.1% in 2006.

Our main interest is inevitably figures relating to foreign
business endeavors in the sparkling Chinese environment.
Regrouping half of China's Foreign Direct Investment, and
40% of China's export value, the Yangtze River Delta can
boast of an astonishing foreign asset concentration and a
dominant position in foreign trade. We can focus on two of
the most successful cities of the YRD, to illustrate its
attractiveness in terms of foreign presence; Hangzhou and
Suzhou.
Some facts:

- Hangzhou specializes in new high technology industries,
having created 4 development zones that regroup 100,000
private enterprises. The 53 Fortune 500 companies and the
6,120 foreign funded projects (76 countries are
represented) highlight the 34% FDI growth reaching 6
billion USD in 2006. Developing exponentially, this is one
of the leading second-tier cities of China.

- Suzhou positions itself as China's new high technology
business incubator, with one Singapore and one Chinese
invested development zone regrouping 110,000 private
enterprises. The fact the 7 million inhabitants of this
area live 35 minutes of fast-train away from Shanghai, that
it is exporting to 140 economies (113 of the Fortune 500
Companies), and that it is the second most FDI attractive
city in china (37 Billion USD in 2007) makes it a
compulsory transit point to anyone thinking of doing
business in China.

Finally, having agreed on the economical competitiveness of
the YRD, let's remember that it is still, its human
resources and its consumption habits that stimulate the
region. Consumers from the YRD do benefit from developed
distribution hubs and consumption patterns moving towards
services, with private consumption value growing around 18%
every year (800 billion RMB in 2006). In addition, with a
very high income level compared to the rest of China and a
large inflow of foreigners, YRD represent China's largest,
most sophisticated consumer market.


About the Author:

Tim Lyons is Executive Director of Manage China. Manage
China is a company that helps foreign firms who are
interested in doing business in China.
http://www.managechina.com