Sichuan Province came with 546 projects worth RMB 418 billion, many related to post-earthquake construction. "Sichuan needs investment of about RMB 1.7 trillion for its recovery from the earthquake, to provide a real spur to the market," said provincial governor Jiang Jufeng. In the first quarter of 2009, Sichuan's GDP growth ranked seventh in the country, and the total volume of foreign trade was the nation's second highest. The projects brought to the forum cover an array of sectors like high-tech, energy, manufacturing, agriculture, services, tourism and infrastructure. Cai Jing, deputy secretary-general of Sichuan, said the 63 preferential policies related to post-quake reconstruction provide a key advantage for the province.

Hong Kong and Macao carry special weight in the area not only for their geographic location, but also for their technological superiority and vast supply of capital. However, Hong Kong SAR chief executive Donald Tsang admitted that it was the close relationship to the mainland that enabled Hong Kong to maintain economic stability amidst the global meltdown, leaving them in a better state than other Asian export economies like Japan, ROK, Taiwan and Singapore.

By the end of April, the value of tariff-free products imported from Hong Kong and Macao to the mainland hit US $2 billion, representing tax exemptions of over RMB 1.3 billion. About 2,500 Hong Kong and Macao-based companies enjoyed CEPA (Closer Economic Partnership Arrangements) preferential policies, when they applied to invest in the mainland. Tsang believed "the PPRD is an important staging ground for further cooperation between Hong Kong and the mainland." Three decades ago, it was in the PRD that HK enterprises started their mainland adventures. By 2008, HK investment had climbed to US $349.5 billion, accounting for about 40 percent of the total overseas investment in the mainland. "Hong Kong is able to provide mature financial and legal services, which are essential for mainland enterprises planning to explore foreign markets," said Tsang.

Integration with ASEAN

"Guangxi should keep close ties with its neighbors in the east, west and south," said Zhong Qiquan, a research fellow with the Guangxi Academy of Social Sciences. To the east lie Guangdong, Hong Kong, Macao and other industrialized regions. Western provinces like Guizhou and Yunnan have been listed in China's Western Development project. To the south lies the ASEAN countries, a grouping of primary importance to Guangxi.

Even in the midst of the global financial crisis, bilateral trade between China and ASEAN surpassed US $200 billion in 2008, and mutual investment approached US $60 billion by the end of that year. The Sino-ASEAN Free Trade Area, expected to be established in 2010, will be the most populous free trade zone in the world, comprising 1.9 billion people. In terms of economic scale it will be the world's third largest block, with a GDP of about US $6 trillion.

Therefore, Guangxi, Yunnan and other provinces adjoining ASEAN have become a focus for many eastern companies. Guangxi's trade volume with ASEAN tripled from 2004 to 2008, with an annual increase of 37 percent. The ASEAN's real investment increased four-fold, while Guangxi's contracted investment in ASEAN grew 26 times.

Participants showing off the local specialities of their regions at the forum.

Fangcheng Port in Guangxi has an annual handling capacity of over 45 million tons. Vice General Manager Zhou Yingxin claims that the throughput was about 17 million tons in the first five months this year, 11.2 percent higher than the corresponding period last year. As exports have decreased, the rise was mainly driven by imports of commodities such as coal, starch and other raw materials.

The shortest road from Guangxi's Dongxing to Vietnam is about 50 km, while the sea route from Fangcheng Port to Vietnam is only 100 nautical miles. This geographic advantage has brought development money to Guangxi. According to Suo Yaozong, vice general manager of China Electronics Beihai Industrial Park, all 10 electronic companies in the complex are from other provinces, but target the ASEAN market.

The current average duty on imports from ASEAN countries is only 2.4 percent, and once the free trade zone is established in 2010, 90 percent of products will be exempt from tariffs altogether.

According to Zhou Yingxin, the key bottleneck in bilateral trade is the lag in railway construction. This situation is expected to improve soon. Vice Minister of Railways Wang Zhiguo states 11,000 km of railways will be constructed in the PPRD, bringing total track mileage to 30,000 km for the region. Some key routes include China-Vietnam, China-Myanmar and China-Laos.

Xu Zhengyou, executive director of the Hong Kong-based China Minerals Group Co., Ltd., signed a contract for a large-scale pulp mill in Beihai, Guangxi. As his company's mineral investments in Australia have stagnated under the financial crisis, he has turned to Guangxi for sulfuric acid, and plans to dip a toe in new fields like pulp production. "The crisis demands we rise to the occasion," he said. "We are undergoing a transformation in terms of production safety and technological upgrades."

Links:PPRD Regional Cooperation

The Pan-Pearl River Delta, aka 9+2, is an emerging economic zone that includes nine mainland provinces – Guangdong, Fujian, Jiangxi, Guangxi, Hainan, Hunan, Sichuan, Yunnan and Guizhou – together with two special administrative regions, Hong Kong and Macao.

Geographically, the PPRD covers a fifth of China. And its population accounts for over one-third of the country. Its nine mainland members alone account for more than one-third of the national economy.

The first PPRD Regional Cooperation and Development Forum was co-hosted by Hong Kong, Macao and Guangzhou in June 2004. The fifth forum, originally scheduled for 2008 but postponed due to the Sichuan Earthquake, was held last June in Nanning, Guangxi.