China woos FDIs in bid to turn Xinjiang into Silk Road hotspot
China is promoting foreign direct investment at 23 national industrial parks in the Xinjiang Uighur autonomous region by providing tax incentives to investors in a bid to boost the economy and turn Xinjiang into a core zone for trade, investment, and logistics on the Silk Road economic belt of the east-west corridor, reports The Nation.
“We provide corporate income tax holiday for the first five years and also a lower corporate income tax of 15 per cent instead of the normal rate of 25 per cent,” He Yiming, director-general of the Xinjiang Commerce Department, said in an interview with The Nation.
He was speaking after the seminar entitled “Cooperation and Win-win: the status quo of the trade development between Xinjiang and its neighbouring countries”.
At the end of 2014, FDI in Xinjiang totalled US$417 million (Bt15 trillion). The main foreign investors come from Hong Kong, the US, and Japan and are primarily investing in textiles, mining, food, commerce, and trade.
From 2000 till 2014, Xinjiang’s investment in foreign countries increased exponentially.
Xinjiang’s gross domestic product was 926 billion yuan (B5.2 trillion) last year – an 11 per cent increase from 2013.
“We expanded our investment in infrastructure and the logistics system to connect between Europe and Asia,” He said.
“This includes Southeast Asia or Asean countries by targeting both investment and trade.”
He said investment between Xinjiang and Asean was less than other countries in Asia, but the figure would increase when Xinjiang was linked by road with India and Myanmar.
“Asean is the third [area] of our policy to boost trade and investment after Central Asia and Europe,” He said.
By 2020, China also aims to turn Xinjiang into a commercial hub and a core zone for transportation, finance, education, science and technology, and medicine.
Xinjiang is located close to eastern Europe and central Asia, meaning it is ideally placed to lure foreign investors from those regions while it was also a gateway for investors looking to expand their portfolios other parts of Asia and Europe, He said.
At the end of 2014, two-way trade between Xinjiang and overseas markets was US$27.67 billion, up 0.4 per cent from 2013.
The volume of two-way services between Xinjiang and overseas markets was US$2.44 billion, up 50 per cent from 2013.
Xinjiang trades with 186 countries, especially eastern Europe countries including Kazakhstan, Kyrgyzstan, Russia, and Tajikistan.
The seminar last Friday was apart of a press workshop on the Silk Road economic belt that is being held in Xinjiang from September 1-10.
