IS SHANTOU A VIABLE CENTRE FOR FOREIGN BUSINESS ACTIVITY?

When a special economic zone (SEZ) was created in Shantou, most foreign investment capital came in the early stages from Hongkong and Macao. From 1984, the SEZ began setting up joint ventures with Chinese enterprises from inland provinces, especially those owned by various departments of the Central Government, large and modern enterprises, raw material production enterprises and defence-related industries. Shantou also used its overseas connections to open foreign markets for joint ventures.

From 1988 onward, the sources of foreign investment and the destination of exports became increasingly diversified. More than 24 countries from America, Britain, France, Germany, Japan, Singapore, Thailand, etc. have set up joint ventures or sole foreign investment enterprises in Shantou.

After 1992, as the Central Government shifted its economic strategy and paid more attention to the economic growth of the central and western provinces, inland regions were encouraged to open “window enterprises” in the SEZs. Consequently, more domestically invested enterprises have been set up in the SEZs and have become an important source of capital for Shantou.

In terms of absolute figures, the foreign trade turnover of Shantou ranked second among the three SEZs in Guangdong in 1997. Despite the Asian economic crisis, the total value of exports in 1998 increased, though less than one per cent.

This solution offers information on:

§ a detailed geographic, demographic, economic and governmental profile of Shantou;

§ the legal framework for local law-making;

§ the legal framework for foreign business organisation and administration;

§ local tax incentives and measures for encouraging foreign investment;

§ regulation of contracts, labour management and land use rights; and

§ other activities or special areas.