Taizhou City -- Stimulus to the Jiangsu Economy

By GAO YAN & QI JUAN

Picturesque Taizhou.

Jiangsu Province, on China's east coast, is now a major economic force, second only to Guangdong Province. The Yangtze River runs through Jiangsu, dividing it into northern and southern parts. Southern Jiangsu is in the developed Yangtze River Delta and has benefited greatly from neighboring Shanghai Municipality, financial and cultural center of China and Southeast Asia. As northern Jiangsu is in the hinterland, its transportation is less convenient than the southern part of the province, but it has rich natural resources. Taizhou City is in the middle of the province on the banks of the Yangtze River, and is a link between northern and southern Jiangsu. Construction of the Jiangyin Bridge has brought Taizhou closer to its bordering cities, enabling it to become the commodity-transfer center of Jiangsu.

Covering 5,793 square kilometers of land and with a population of 5 million, Taizhou was approved as a prefecture-level city by the central government in 1996. On December 8, 2002, city leaders took the Taizhou investment invitation group, numbering more than 300, to Shanghai in search of business opportunities. Formerly a privilege confined to southern Jiangsu cities, this was the second business group sent to Shanghai by Taizhou since the end of 2001.

Prior to completion of the Jiangyin Bridge, it took more than six hours to travel by bus from Taizhou to Shanghai. Inconvenient transportation thus inhibited investment in northern Jiangsu. On September 28, 1999, the Jiangyin Yangtze River Bridge opened to traffic, linking the two banks of the Yangtze River and bringing new opportunities to Taizhou. It won the gold Eugene C. Figg Jr award at the October 2002 International Bridge Conference. This hi-tech bridge has a wide road divided into six lanes on which cars drive at a speed of up to 100 km/h. It shortens the distance between northern and southern parts of Jiangsu, and cuts down the traveling time from Shanghai to Taizhou, via the Shanghai-Nanjing Expressway, the Jiangyin Bridge and the Nanjing-Nantong Expressway, to just 130 minutes. Other main highways, such as the Beijing-Shanghai Expressway, the Nanjing-Jingjiang-Yancheng Highway and the Xinyi-Changxing Expressway, also pass through Taizhou. Upgraded transportation has stimulated Taizhou's economic growth, earning it a place in the Shanghai economic circle.

The Qintong Boat Race -- an exciting annual event in Taizhou.

The development of many a city has benefited from having a river running through it. Three years ago the Taizhou municipal government invested 240 million yuan in diverting water from the Yangtze River into the city, enabling citizens to drink water from the Yangtze, and also using diverted water for navigation, irrigation and flood relief purposes. The diverted water channel is hence known as the water expressway through northern Jiangsu Province.

The Yangtze River to its south, Taizhou has three harbors. Every day, ships from around the world berth and load in the national category-one open port. It has an annual handling capacity of more than 10 million tons, and its newly built comprehensive wharf can berth ships of up to 25,000 tons.

Chunlan Group: Boost to the Taizhou Economy

The industrial history of Taizhou started in 1906 when the German equipped Tailai Flour Mill was established. For quite some time Taizhou had only small processing plants, and the emergence of the Chunlan company in the late 1980s brought dramatic changes. The economies of many cities have been boosted by the development of big companies located within them, such as Coca Cola in Atlanta, Microsoft in Seattle and Boeing in Chicago. In Taizhou, it was the Chunlan company that brought fame and fortune to the city.

Chunlan started as a small air conditioner plant. Over the past two decades, it has developed into a multi-functional international company, enlarged its industrial scale 600-fold, increased its capital assets 700-fold and its economic benefits 500-fold. There was once a popular saying in Taizhou, "Marry your daughters to Chunlan workers, and send your sons to work at Chunlan." Chunlan was regarded by many Taizhou people as a means to wealth, and applications for positions in the company were highly competitive. The emergence of Chunlan changed Taizhou's industrial development mode. It sustained an economic growth rate of over 45 percent for five years, and in 1993, its industrial output value increased by 121 percent, making it the third most affluent small city in China, after Yuxi in Yunnan Province and Shunde in Guangdong Province.

Taizhou Port -- always busy.

Chunlan's development helped to improve Taizhou residents' living conditions. The Chunlan Group's salary reforms increased its employees' income nearly ten-fold. As a result, the economic volume of the company saw a sharp increase. Since 1992, the average annual production of Chunlan has been more than 1 million -- higher than Japan's Toyota. In 2002, Chunlan realized an economic profit of 1.36 billion yuan, accounting for a quarter of Taizhou's total.

The Taizhou city government was not, however, content simply to rely on the Chunlan Group. In the mid 1990s, it set itself the target of creating Chunlan mode enterprise groups in Taizhou. Enterprises that reached an annual sales volume of 1 billion yuan or earned profits of 100 million yuan were designated "Chunlan-mode enterprises."

The Chunlan Group now includes 42 corporations, most of them formed by merger or purchase of local enterprises in deficit. For instance, the Jiangsu Wanma Metal Products Company was originally a small scissor-production plant. In 1994, it began to produce outer casings for Chunlan refrigerators and air conditioners, and it has since developed into a medium-sized key national enterprise with nine branches and total assets of 150 million yuan. Specializing in gardening equipment, starting from 1992 the Taizhou Phoenix Mechanical and Electrical Equipment Co., Ltd., began producing machinery accessories for Chunlan, such as copper fittings and freezers. Its present output volume is 200 to 300 million yuan, and it has expanded its business to include real estate and the leisure industry.

According to incomplete statistics, the Chunlan Group has provided some 300,000 direct and indirect working opportunities within Taizhou. Since 1994, Chunlan has donated 6 million yuan annually to the Taizhou city government poverty relief fund, and more than 3 million yuan to its flood prevention fund. Chunlan also donated the 100 million yuan to the construction of Taizhou Stadium.

There are now 22 Chunlan-mode business groups in Taizhou, including the well known Yangtze River Pharmacy Group, which was named second of the top 50 Chinese pharmaceutical enterprises by the State Pharmaceutical Administration. Some of its products have entered the EU market. There are now some 70 large and medium-sized enterprises in Taizhou and their production scale and market shares are high in China. In 2002, Taizhou's GDP exceeded 50 billion yuan, its revenue was more than 5 billion yuan, and its economic growth had surpassed the provincial average for five successive years.

Tourism Development: Traditional and Modern Resources

Taizhou is a city with a history of more than 2,100 years. On taking a stroll through its parks, one generally comes across groups of three to five retired men singing opera -- not the local but the Peking Opera most famous in northern China -- for their own amusement. Mei Lanfang, famous Peking Opera actor of the early 20th century, was native to Taizhou. Peking Opera is hence very popular in the city, and overseas Peking Opera fans also often come to Taizhou to join in their activities.

Mei Lanfang Park.

Another interesting feature of Taizhou is that many of the names of its street and shop names incorporate the word tax. There is, for example, the Tax Pancake Shop, the Tax Supermarket and the Tax Snack Shop. All these originate from the Tax Bridge, a small but beautiful bridge in Taizhou. As the Yangtze River is to the south and the Yellow Sea to the east of Taizhou, there used to be many salterns in the area. As from the Tang Dynasty (618-907), the imperial government levied salt tax on salt dealers, and Taizhou became a main tax collection center. The bridge was near the Tax Bureau, so it became known as the Tax Bridge, and many nearby shops and streets followed suit.

The liveliest event of the year in Taizhou is the day before Qingming Festival (when families go to pay their respects at their ancestral graves) when a boat race is held on Qintong Lake. Jiangsu Province's boat races have a history of more than 800 years, and the Qintong Lake boat race is most famous. On that day, the lake heaves with some 20,000 local people and more than 1,000 boats decorated in beautiful colors. In 1992 the Qintong Lake Boat Race was designated a key tourism program and first choice for the China Folklore Tour by the China National Tourism Administration. The number of foreign diplomats and businessmen going to Taizhou for sightseeing is also on the increase.

The China Phoenix Garden, a new scenic site covering 4 million square meters, is currently under construction at an investment of 1 billion yuan. When completed, it will considerably enhance the city's tourism appeal. Taizhou has made great progress over the last few years. Its urban area has expanded from 120 to 428 square kilometers, and some 60 roads and 50 bridges have been newly constructed. Taizhou has successfully combined traditional culture with modern industry.

Ready to Be Internationalized

The growing economy of Taizhou has attracted much overseas investment. Wu Tianbai, Taiwanese deputy manager of the Zhongdan Group, says, "Taizhou has a good investment environment. Employees here are well educated and have impeccable qualifications. Many of my foreign friends envy me my opportunity to invest in Taizhou."

In 2002, Jiangsu Province introduced large amounts of direct foreign investment -- second among all Chinese provinces and autonomous regions. Introducing foreign investment is now an important item on the local government's working agenda, and improvements to the investment environment are a main concern. Taizhou began to attract foreign capital by reducing tax and leasing land at low prices, and the Taizhou city government is currently improving government services and developing auxiliary industries to draw more overseas investment.

There are many Peking Opera fans in Taizhou.

Taizhou city leaders are aware that in order to attract foreign capital they should make it easy for investors to stay and make a profit. An open city approved by the Chinese State Council, Taizhou enjoys import and export rights, and has maintained friendly trading relations with 98 countries and regions. Most of its export commodities are industrial products. Large numbers of foreign enterprises, including some listed in Fortune 500, consider Taizhou a good investment destination. Yamaha, LG and GMT have all set up their branches or offices in Taizhou. By 2002 it had 1,500 foreign-funded enterprises.

Public utilities are normally a government monopoly in China, but in Taizhou they are open to overseas investment. In May 2002, Britain's Anglia Water invested 100 million yuan in establishing a joint venture with the Taizhou Running Water Company and purchased management control of three water works in Taizhou for 20 years. The British side controls 95 percent of the share. Anglia Water is a well-known British company and has developed water processing and sewage treatment in 19 countries.

Hamer works as a foreign expert at the Taihang Electronics Co., Ltd. He came to Taizhou four years ago. Hamer seldom goes back to his German home for Christmas, instead staying at the factory with his Chinese colleagues and giving them technical guidance. When Hamer first arrived in Taizhou, he could not find recycling bins for his used batteries, and so collected and posted them back to Germany every six months. His environmental awareness affected local Chinese residents. Long Fang, a senior woman citizen of Taizhou, now collects used batteries at her home and on the streets. "I have seen on TV how used batteries pollute the soil and water," says Long Fang. "Shops in other cities provide boxes for used batter disposal. I also want to do something for Taizhou's environment."

There are foreigners from dozens of countries in Taizhou's education, cultural and business organizations and enterprises. Taizhou has six sister cities in the world, including Newport News in the USA, La Trobe in Australia, Eumseong in the Republic of Korea and Kotka in Finland. It carries on friendly exchanges with these and many other international cities.

Taizhou is of strategic importance to the province's development. Its opening and development stimulate the local economy, enabling it to take the lead in northern Jiangsu.