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Local service industry to ride high on back of new policies

Updated: 2014-01-28 07:52

By Li Fusheng (China Daily)

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Sichuan's provincial capital Chengdu is expecting robust growth in its service industry this year now that local authorities have announced a new round of policies designed to stimulate the sector.

The policies released on Jan 16 are aimed at developing the higher end of the service industry, attract multinationals to move their headquarters to Chengdu, and encourage modern building complexes to play a larger role in the industry, said Zhang Jinquan, deputy director of the Chengdu Bureau of Commerce.

The city's service industry serves 100 million people from Chengdu and neighboring cities and provinces in Southwest China.

With Chengdu playing a more prominent role in the global economy, there has been a call for better services to meet the demands of an increasingly mixed population.

"A strong service industry is essential to speeding up the effort to transform Chengdu from a regional hub into an economic powerhouse in western China," said Zhang, adding that the promulgation of the three policies has resulted in a sound framework to boost the industry.

In fact, the service industry has been gaining momentum in the city since the Chengdu government designated some 30 clusters of service companies and released a number of measures to encourage their development in 2013.

Zhang said the industry's sales revenue will reach an estimated 452 billion yuan ($74.71 billion) in 2013, an annual growth of 8.5 percent from the previous year, and the combined revenue of consumer commodities in the year will surge by more than 13 percent to 375.2 billion yuan.

Local service industry to ride high on back of new policies

More than 8,000 companies are doing business online in the city.

And the city's e-commerce totaled more than 400 billion yuan in 2013, of which transactions done by mobile devices had a combined value of 13.6 billion yuan.

Based on the achievements, local authorities will make every effort to push the service industry to new heights this year, with an emphasis laid on the high end, Zhang said.

In one of the newly released policies, the Chengdu government has singled out eight industries as priorities in its initiative- financial services, technology-related services, information-oriented services, logistics, business services, creative industries, health and public welfare, as well as emerging industries like mobile e-commerce and service outsourcing.

"Those industries were selected because they will generate overall effects on improving Chengdu's service standards and its comprehensive competitive edge," Zhang said.

The government announced it will also make market access easier to attract more private capital while building platforms to facilitate research and development as well as intellectual property protection.

It also plans to further reform the financial system and the government procurement system to offer local companies some advantage.

Another part of the policy is intended to attract well-known multinationals to set up regional headquarters in Chengdu and cultivate a number of globally competitive local companies.

"The so-called headquarters economy is of strategic importance in the effort to transform a city's development mode," said Zhang. The policy details favorable measures in six aspects, including offering financial stimuli and providing smoother administrative procedures.

As laid down in the policy, a company which has a registered capital of more than 1 billion yuan in Chengdu or sets up the headquarters for the Asia-Pacific region in the city is eligible for a reward of 30 million yuan.

Those with a registered capital of more than 500 million yuan or that establish the headquarters for China operations can receive 20 million yuan in subsidies.

And those that make extraordinary contributions to the city's service industry will receive a reward up to 50 million yuan.

Top managers and technicians at the newly established headquarters can also benefit from the policy in terms of relocating to Chengdu and placing their children in local schools.

The last policy concerns the city's modern buildings and skyscrapers as they are "an important carrier" of modern service industry, Zhang said.

Aimed at office buildings with a floor space of at least 20,000 square meters or complexes with a floor space of more than 150,000 sq m, the policy encourages property owners to attract corporate headquarters and entities with outstanding financial performance by offering financial rewards. There are also measures to introduce administrative departments to better serve those companies, Zhang said.

lifusheng@chinadaily.com.cn

Local service industry to ride high on back of new policies

Workers at the production line of Dell's branch in Chengdu. The government aims to attract more well-known multinationals to set up regional headquarters in the city. Wang Xiwei / for China Daily

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