"The addition of Lingang New Area is not just a simple expansion in space or duplication of FTZ policies, but aims at a higher level of opening up and deeper reform in broader fields," Chen said. 

He said the recent move is targeting more on free trade and investment in addition to trade and investment facilitation. "The new area allows more free activities in investment, trade, finance, transportation, and talents, as well as quicker and more convenient information flow." 

It will also be tasked with new strategic agendas so as to serve the Belt and Road Initiative, promote the coordinated development of the Yangtze River Delta. Moreover, the new area will focus more on developing industrial clusters for the cutting-edge industries, and be given greater administrative power for self-reform, self-management, and openness, Chen added. 

The Lingang boon 

Tesla's Tao Lin said the biggest advantage of operating in a pilot area is that "it allows more innovative ideas to thrive, and bold steps taken to explore new ground, giving us more space to try out the world's newest technologies and innovative business models." 

According to the State Council plan, the new area will strive to become a business cluster for international business, cross-border financial services, frontier technology research and development, cross-border services trade, and also speed up the industrial upgrading of existing companies. 

In another Shanghai Observer report, Yu Changfu, chairman of Shanghai Sany Heavy Machinery based in Lingang, said the launch of the new area as part of the Shanghai FTZ will greatly help to improve the company's global competitiveness. 

"The policy advantages in Lingang will bolster the company's smart and digitalized transformation, which is expected to complete in the next two years," Yu said. "Moreover, the preferential policies we enjoy operating in the section will also help us better attract global talents, as well as capital and investment." 

In the past two months, 1,329 companies established operations in the new area, and 62 more have signed agreements to move in, which altogether brought in an investment of around 26 billion yuan, according to reports. 

Chen Jie said that, apart from attracting foreign businesses, the area also provides a platform to facilitate the global development of Chinese enterprises, and the best practices in its trial reforms will be scaled up to other parts of the country.