Pudong New Area will keep preferential investment policies even after it is stripped of its status as a special economic zone, said the Shanghai city officials.
Starting from this Friday, Pudong will become the 16th district of Shanghai with independent district government bodies.
The former administration committee, a direct agency of the municipal government, was dissolved.
Zhou Yupeng and Hu Wei were elected the top officials of the new district government, but they will still keep their positions in the municipal government.
"After the status change, Pudong will not end the preferential policies promised by the former administrative committee, but rather strengthen them in some fields,'' said Zhou Yupeng, the city's vice-mayor.
However, preferential fiscal policies given by the central government to Pudong, namely tax breaks on the fiscal taxes by the central government to local administration committee, will end by the end of 2001, Zhou said.
"But that is the fiscal policy involving the central and the Pudong governments, and does not affect individual enterprises and industries,'' Zhou said. These would end even if the district government had not been established, he added.
Preferential policies to individual industries, however, such as the return of half of the annual fiscal taxes by companies for five years, will be maintained.
"There will be even more preferential policies for information technology and electronics,'' Zhou said.
Responding to the complaints from investors that Pudong land prices are too high, Zhou said the district government would reduce prices for some industries.
Zhou added that the new district government would continue preferential policies for domestic investors aimed at "... strengthening co-operation with inland cities.''
He said, with the establishment of the new district government, it would become more convenient for Pudong to establish sister city relationships with inland cities. Xining, capital city of Qinghai Province, has already entered negotiations with Pudong to that end.
(From China Daily)
