The port city Dalian in Northeast China's Liaoning Province has unveiled ambitious plans to triple the sales value of its software sector by 2007.

With its products oriented towards the nearby Japanese market, the city's high-tech industry has developed into a key aspect of the local economy.

Dalian Bureau of Information Industry Director Luan Qingwei said the city realized a software sales value of 4.5 billion yuan (US$542 million) by 2003.

This includes US$120 million of exports to Japan, accounting for 90 percent of all software shipped overseas from the city.

And Luan revealed to China Daily that the bureau plans to triple the sector's sales volume over the next three years, with exports increasing sixfold over the same period.

More than 350 software development firms have already set up shop in the city.

Among the software developers are data service centers set up by 16 of the world's top 500 firms in the sector, such as IBM, Dell, Nokia and Accenture.

"To ensure the faster development of the industry in the city, Dalian is supplying an all-round service system to provide an ideal environment, a smooth connection with the outside world and qualified professionals," Luan added.

Software firms are stepping up their demand for talented staff, making education and training a priority.

"Three software institutes with about 2000 graduates every year and more than 200 training firms can seldom meet the increasing demand," Luan said.

To tackle the problem, Dalian is trying to increase annual enrollment to 6,000 students and also wants to attract overseas students and professionals.

An office set up by the municipal government to promote software business in Japan helped earlier this year enlist dozens of professionals familiar with business practices in Japan.

Luan said the city will set an office in the United States late this year to expand business in North America.

Another platform for business exchanges is the State-level China International Software & Information Service Fair to be held in July.

Approved by the State Council, the country's largest software fair will provide 1,000 standard booths for more than 800 participating enterprises, including world famous software outsourcers and vendors, said the director.

The city is constructing a software industrial base in a 133-square-kilometer area along its South Lushun Road, a hilly seaside scenic spot, in a bid to attract more overseas software developers.

The project is the Dalian Software Park's second phase of construction.

Another 300 enterprises are hoped to settle in the park after it is completed in three years, said Sun Yinghuan, president of the park.

Now the park hosts more than 130 companies, with annual exports of US$25 million.

The bureau has also helped software companies in the city adopt the SEI CMM5 (capacity maturity model) assessment, a model for judging the maturity of their software processes.

Among the six CMM5 firms in the country, Dalian has two. One is Dalian Hi-Think Computer Technology Co Ltd (DHC).

As China's biggest software exporter, DHC serves more than 30 top Japanese companies, said Sun Jian, DHC chief business officer.

By managing more resources, DHC is running a software developer union, while also trying to enlarge its capacity.

"We have worked out a software outsourcing management platform to guarantee the high quality of all our products in the entire process," said Sun.

(China Daily May 26, 2004)