Home Business China International Culture��Edu Sci��Tech Sports Life Travel P hotos ��Search China Observer �� Ma Kai: China's economy and macro-control policy �� China's petroleum import dependency to top 50% in 2010 �� How should foreign investors manage risks of policy changes in China? Photos �� "Chocolate car" dazzles Xi'an �� Tokyo International Boat Show displays a "never sinking boat" �� 100,000 people flocked to the Dragon Pond Temple Fair ��Home>>China Observer Central and western China to be paradise for foreign investors www.chinanews.cn 2005-02-16 13:12:44 Chinanews, Feb. 15 - Sun Hongwei, Rong International's president of the China region, pointed out that China's eastern region remained a hotspot for attracting foreign investments, but following the further implementation of the Chinese government's idea of "overall, balanced and coordinated" regional development policies, in the following twenty to thirty years, preferential investment policies which surfaced in the first twenty years of economic reforms and liberalization will reemerge only in the central and western regions. Therefore, based on their own investment strategies and industrial policies, investing in the central and western regions will be one of the best choices for investors. In 2004, the growth rate of foreign investments in the northeastern and western regions surpassed the average rate in the entire country. This is conducive to changing the current situation, in which foreign direct investments are excessively concentrated in the Yangtze River Delta and Pearl River Delta regions. However, as the growth rate in the northeastern and western regions was based on very low figures to begin with, the foreign investment in the eastern provinces currently takes up more than 85% of the investment pie. Regarding the current situation whereby most foreign investments flow to the eastern regions, Sun said that there were still too few foreign investors who really understood and could adapt to the Chinese market. Most foreign investors insist on open and transparent principles of market-based operations. They strive to make the Chinese market fit themselves, rather than adjust themselves to fit the Chinese market. In Sun's opinion, wise investors should follow policies and take advantage of trends. From the perspective of the market economy as a whole, perhaps his strategy is not always completely correct, but it brings the highest profits. Although a superficial examination of the investments and benefits show that the return and stability of investing in the east will be bigger than investing in the west, the value-added potential in the west is very high. Because of the preferential policies, priority to land tenure and market share and so on, the one who grabs the market first may be able to monopolize that market. Any region could have a very potential for investors, but the amount of realized profit is correlated with the effectiveness of the government's preferential policies. Sun advised foreign companies, if they want to make money, to learn to adapt to the Chinese market rather than make the Chinese market conform to themselves. E-mail: zhangqinghua@chinanews.com.cn Tel: 8610-88387443 Fax: 8610-68327649 Copyright� 2004 Chinanews.com. All rights reserved. Reproduction in whole or in part without permission is prohibited. Disclaimer: viewpoints in the website do not represent China News Service Learn Chinese online