Decoding Chenzhou City’s Rapid Improvement

Focusing on the undertaking industrial transfer to improve its transformation of resource-oriented city, Chenzhou city discarded the economic development pattern of mine-oriented.

Beihu Lake

Chenzhou city- Hunan province’s “south gate” and the “bridgehead” for connection with Guangdong province, HK and Macau.

In recent years, along with the improvement of reform and opening up, Chenzhou city was developed greatly. 

Following were series amazing data of Chenzhou city:

Chenzhou city’s GDP hit 100billion yuan in 2010 and was amounted to 170billion yuan in 2013;

Its fiscal revenue hit 10billion yuan 2010 and reached 21.8billion yuan in 2013;

In 2012, its total volume of import and export ranked the second place of Hunan province, and the processing trade ranked the first place.

Following were series amazing honors:

National garden city;

China example of habitat environment prize;

The state’s transportation management model city;

Chenzhou city was covered into the first phalanx of economic and social development in Hunan province;

Zixing city, Guiyang county and Yongxing county were enrolled into the list of top ten county economy of Hunan province.

Due to the great improvement of Chenzhou city, many neighbor cities from Guangdong province and Jiangxi province as Shaoguan, Qingyuan and Ganzhou city visited Chenzhou city to learn its experience.

Four cadres from Guangdong province were dispatched to practice in Chenzhou city after the investigation team appointed by Guangdong Provincial Party Committee visited Chenzhou city “South Daily” – Guangdong provincial party committee official newspaper issued a report entitled “the rise up of counties in south Hunan province” to study the improvement of Chenzhou city. The reporters were surprised that: “former ‘poor relative’has stepped far ahead of Qingyuan city. ”

Focusing on the undertaking industrial transfer to improve its transformation of resource-oriented city, Chenzhou city discarded the economic development pattern of mine-oriented.
Chenzhou was a typical resource-oriented city which was famous as “city of China’s non-ferrous metals” and “resource base of south China”.

“Two mines”(non-ferrous mine and coal mine), “two powers” (thermal power and hydro power) and “two tobaccos” (flue-cured tobacco and cigarette) formed the basic industrial pattern of Chenzhou city for a long term. Especially for the mines, it covered over 60% GDP, 70% scaled industrial added value, and 75% fiscal revenue in earlier years.

Such kind of resource-oriented economic structure suffered badly in 2008 financial crisis. The problems concerned for resource, environment, social development, and etc. were highlighted after the crisis.

All the decision makers of Chenzhou city realized that to keep the sustainable development, Chenzhou city should improve its industrial structure fundamentally. But because of the poor endogenous power, Chenzhou city should be improved with the external forces.

“To improve Chenzhou city as the most open city of Hunan province, to improve Chenzhou city along with opening up, and to upgrade Chenzhou city ahead of south Hunan province, inter-provincial cities, and Hunan province”- that was the new strategic targets set by Chenzhou government.
By seizing the chance of hot industrial transfer, Chenzhou city well played its location advantages of being adjacent with Guangdong province, HK and Macau to welcome the global capitals.

It was an exciting planning for Chenzhou city’s development of undertaking industrial transfer that it aimed to build a national first-rate production base of non-ferrous profound processing, new material and electronic information. It would pay more attention on undertaking labor intensive industries, strategic emerging industries, and modern service industries and would figure out the layout along Chenzigui-Chenyongyi “great cross” town cluster.

Chenzhou started the work from establishing platforms to attract more investors. One national export processing zone, 11 Hunan province industrial parks, and etc. were built in a short time. Furthermore, customs, inspection and quarantine, highway and railway port, bonded logistics, convention and exhibition, finance, and other export-oriented economic platforms were established in Chenzhou city as well.

Delta Electronics Group, Phillip Lights, China Minmetals, China National Building Material Company, and other 1300 domestic and foreign enterprises were settled down in Chenzhou city, which helped to attract over 120billion yuan domestic capitals and $4 billion foreign capitals.

It seemed that all the changes happened in a short time. A lot of strategic emerging industries as non-ferrous new materials, photoelectricity information, advanced device manufacturing, new energy, modern service industry, and etc. were developed in Chenzhou city. It was improved from “black” to “green”, from underground to overground, from non-ferrous metals materials marketing to mobile phone marketing, and from coal marketing to robot marketing. All these indicated that Chenzhou city headed to establish its modern industrial system in current years.

Hunan Grand-Pro Technology which was located in Chenzhou High-tech Industrial Park was the joint venture of the world’s second largest auto vacuum manufacturer-Matsutek. The reporters were shocked on visiting their exhibition room. One of its world’s thinnest auto vacuum which was just 5cm thick can collect dust, sweep, make turn, climb, and find the recharger. As long as you set the working time, it would be the best and hardest working cleaner.
Such kind of high-tech example was just one of the miniatures for Chenzhou city’s industrial transformation with the help of external forces.

“How can Chenzhou city attract a large amount of investments on undertaking industrial transfer under such severe competition in China?”

Xiang Lili- Secretary of Chenzhou Municipal Party Committee talked the details with reporters when they were walking around the energetic industrial parks. Xiang said: “Chenzhou city was with sound location advantage, low operation cost, famous brands of national export-processing zone and national demonstration area of undertaking industrial transfer and 34 favorable undertaking industrial transfer policies granted by Hunan Province.”

“Standard workshop is one of the trump cards to attract investments” said Xiang. From 2009, Chenzhou city launched a standard workshop project named “three year, 5million square meters”. “People who build the standard workshops can benefit from it.” Such kind of favorable condition attracted a large number of social investments to gather there. 13 million square meters standard workshops were finished in recent years.

Thanks to these ready standard workshops, some enterprises can start production in Chenzhou city in 1-2 months.

Grape Battery Company which is the leading enterprise of ni-mh and li battery still operated its production in Shenzhen city three years ago. In order to decrease the cost, Liu Miao- Director of the company decided to transfer its production base to inland.

After traveling and investigating around China, Grape stopped its step in Chenzhou city. “When we visited Chenzhou city, ready workshops, dormitories, supporting accessories, and etc. were available in the beautiful industrial parks.”

In 2010, Grape placed 320million yuan to rent nearly 20,000square meters workshops in Chenzhou city and settled down its production base there in less than 2 months.

One year later, Grape decided to buy lands in Chenzhou city to build its plants and offices. It moved to its new house covered with 218mu lands in 2011 and completely settled it down in Chenzhou city.

Shenzhen Jinxun Electronics Company which was the leading enterprise of LED display in China transferred one of its production lines to Yongxing cycling economic industrial park in 2011. Due to the sound operation, it transferred the second and third lines afterward.

Gospel even moved its headquarters to Chenzhou city from Shantou. Along with years development, its employments increased to over 6600 from 300. Now it became the leading enterprise of Hunan province’s electronic information industry.

“Low-lying land”effect of undertaking industrial transfer was shown in Chenzhou city

Chenzhou city’s economy was changed gorgeously. In 2012, the scaled industrial added value of mining industry covered 24.4%, while other manufacturing industries covered 69.6%. The traditional mining industry’s contribution to tax payment dropped to the third place from first place.

The total added value of scaled industries hit 83.27billion yuan in 2012, ranking the third place of Hunan province, while the increase rate of scaled industries was 15.4%, ranking the second place of Hunan province.