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Foreign direct investment (FDI) in Shenyang is expected to reach US$2.3 billion this year, a record high for the past decade, Mayor Chen Zhenggao told China Daily.
Statistics from the local Foreign Trade and Economic Cooperation Bureau show the capital of Liaoning Province attracted US$1.47 billion in foreign investment in the first 10 months of this year, up 52.9 percent from a year earlier. Among foreign-funded projects approved between January and February, 38 were large enterprises each involving over US$10 million. Most of this capital came from South Korea, Japan and the United States.
Chen predicted Shenyang may become one of the three largest foreign capital users among all Chinese cities this year.
The city's economic achievement, multiple sources of capital, rich natural resources and close links with the outside world give the mayor confidence.
"I believe Shenyang will be among the 3S group," he said.
The idea of the 3S group was created by Chen. It stands for three large Chinese cities with names beginning with S: Shenzhen, Shanghai and Shenyang.
Shenzhen, China's first special economic zone, was an economic development pioneer in the 1980s, and Shanghai witnessed fast development in the 1990s due to the opening of its Pudong area. " Now it is the golden period for Shenyang," Chen said.
"Compared with the south, Shenyang has many advantages such as energy resources and a vast market. It is hard to resist this temptation no matter whether it is foreign or domestic funds," said Song Zhongyu, professor of Liaoning University.
Besides fresh capital input, many foreign-funded enterprises have expanded investment and launched new projects in Shenyang. They include Japan's Toshiba Elevator and US-based General Electric (GE).
"The new joint venture is another milestone for GE. With product localization, we can better meet burgeoning local demand," said Bill Cooney, general manager of GE China's gas turbine programme.
Despite the positive aspects, there are also some drawbacks. US shaving goods tycoon Gillette stopped cooperation in Shenyang in October. It was, at the time, one of the oldest joint ventures in Northeast China.
"This is normal economic activity. Just like the birth and death of human beings, it would be abnormal if there were no deaths," Chen told China Daily.
In addition to its industrial area, Shenyang has also achieved great progress in international financial services.
Early last month, Hana Bank from South Korea set up a branch in Shenyang.
Furthermore, Shenyang opened up for foreign financial institutions in terms of local currency services one year in advance.
And another five foreign banks would make their presence felt there next year, Chen said.
"Our final goal is to build Shenyang into a central city and a financial hub in Northeast China," he said.
To become a central city, the environment cannot be neglected. "A city can never catch international attention without a good environment," Chen said.
Shenyang has input 25 billion yuan (US$3 billion) into environmental projects in the past three years. Over 3,000 chimneys have been pulled down in the past three years and the city has established a central heating system in major urban areas.
(China Daily December 16, 2004)
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