Sichuan looks south for economic growth

Sichuan province in southwestern China is looking at all four points on the compass as it develops its strategy for across-the-board social and economic development.

But it's paying special attention to the south.

Sichuan's leaders intend to actively take part in cooperation mechanisms China has built up with Singapore and the countries of the Association of Southeast Asian Nations, as well as to participate in the construction of China- Indochina Peninsula, China-Pakistan and Bangladesh-China-India-Myanmar economic corridors, so as to find new development space for the province's opening-up economy by exploring large South Asian and Southeast Asian markets.

Expansion of trade to the east, west and north will require efforts to deepen construction of the Chengyu Economic Zone, an initiative launched by Sichuan and Chongqing to promote economic growth of China's western region, further exploit advantages of China-Europe Express Railway, give full play to Chengdu's role as a regional international aviation hub and participate in the establishment of the China- Mongolia-Russia Economic Corridor, according to the provincial government.

Sichuan enjoys unique geographical advantages. It is a core heartland in the intersection of the Belt and Road Initiative and the Yangtze River Economic Belt, an important transport corridor linking China with South Asia, Central Asia and Southeast Asia — and it happens to be the birthplace of Deng Xiaoping, the late chief architect of China's reform and opening-up.

Sichuan's southward-looking initiatives will help the province better integrate into China's opening-up strategy, take part in the construction of six large economic corridors and the 21st Century Maritime Silk Road, and promote cooperation with countries involved in the Belt and Road Initiative. Sichuan can also set up new patterns of partnerships and industrial supply chains with countries and regions in southern areas to move production capacity cooperation to a higher level and a wider scope.

The recent Western China International Fair, held in the provincial capital of Chengdu in September, for instance, attracted all 10 ASEAN member countries and six major countries in South Asia. Pakistan, Nepal, Laos and Thailand also set up national pavilions at the fair.

Muhammad Mudassir Tipu, Pakistan's consul-general in Chengdu, said: "They place a high value on cooperation with western China, especially with Sichuan, and hope to leverage more such opportunities in the future."

Fair organizers also invited officials from the Hong Kong Special Administrative Region government and the Hong Kong Trade Development Council to discuss the establishment of an investment platform related to the southward opening-up. The special administrative region has most important source of overseas investment and also one of the favorite investment destinations for Sichuan companies. Currently, more than 20 Sichuan companies have been listed on the Hong Kong bourse, and more than 5,000 Hong Kong companies have located projects in the province, with total investment exceeding $50 billion.

Other favorite investment destinations include Singapore and Vietnam.

On Sept 14, the 19th Singapore- Sichuan Trade and Investment Committee meeting was held in Chengdu, during which the two sides signed cooperation agreements on 22 projects covering technology and innovation, transportation and logistics, healthcare and education. In Vietnam, nearly 10 percent of the market share in the feed industry has now been occupied by Sichuan companies, and New Hope Liuhe, a listed company of China's leading feed producer New Hope Group, was the first to explore the Vietnamese market by establishing a feed factory there in 1999. Competition was fierce at that time, as the country already had 180 local companies and more than 60 foreign enterprises in the industry. "Although we are one of the industry leaders in China, we were not trusted by consumers in Vietnam at first," said Bao Yongcai, a regional chief financial officer of New Hope Liuhe in Vietnam.

New Hope Liuhe resorted to cheaper prices and diverse services as a stepping stone for the first three years to build up a good market reputation and win recognition from local customers.