Chinese Premier Wen Jiabao discusses cross-Straits trade initiatives and the potential for still further expansion with leading executives of the Prima Group during his trip to the Xiamen-based company in May. Xinhua
 

Chairman of the National Committee of the Chinese People's Political Consultative Conference Jia Qinglin pays a visit to a garment company in Quanzhou in May. Xinhua

Senior State officials have been pouring into Fujian in recent months. The deluge of dignitaries into the southeastern coastal province came in the wake of last month's announcement by the State Council of plans to massively redevelop the area's economic infrastructure. The officials' fact-finding visits reflect the seriousness with which the central government is addressing developments on the western side of the Taiwan Straits.

Among the most high profile visits to the area was the May 14 arrival of Jia Qinglin, chairman of the National Committee of the Chinese People's Political Consultative Conference. Following the conclusion of his whirlwind inspection, Jia emphasized the importance of accelerating the growth of the Fujian economic zone.

Jia said the economic zone was a vital link in promoting the rapid development of areas with intensive Taiwanese investment. He also said it would facilitate greater exchange and cooperation with Taiwan.

Facing Taiwan immediately across the Straits, Fujian is a prime venue for business exchange with the island. Commenting on the State Council's proposals for the construction of an economic zone in the area, Jia said the province needed to "make bold attempts" to implement the scheme and should look to expand mutual investment and cooperation in the agriculture, finance, tourism and infrastructure construction sections.

A week prior to Jia's trip, the Chinese Premier, Wen Jiabao, also conducted a three-day inspection tour of Fujian. During the trip, Wen too called for prioritization of the economic zone's development, saying it was vital to boost social and economic development in the region and combat the global economic downturn.

Wen said the economic zone, centered on Fujian and facing Taiwan Island across the straits, had been long planned by the central government.

This economic zone, he said, would make use of the currently cordial ties across the Taiwan Straits and forge a stronger, mutually beneficial, economic cooperation between both parties. He believed it could also help tackle the challenges of the current global downturn.

A new growth engine

According to Wen, the economic development of the region represented a very real opportunity to activate a new engine for growth. This would see clear moves made to capitalize on Fujian's close links with Taiwan and significantly add to the country's long-term development plan.

During his inspection of nine companies, spread across three of Fujian's leading cities -Fuzhou, Quanzhou, and Xiamen - Wen stressed the need for creativity to be at the core of the development of the area's economic zone. He said: "Creativity is the key to our plans to build for long-term success in the region. It will allow us to accrue considerable economic advantages and fuel development in the region."

He urged many of the region's labor-intensive industries to become more technology-intensive, adding that the information technology and environmental industries were two of the primary focuses for economic competition and ones that merited especially vigorous development.

The premier also called for greater importance to be attached to boosting social security systems, one of the government's key measures in combating the global financial crisis.

The State Council's plan to boost the development of an economic zone on the western side of the Taiwan Straits was formally adopted on May 4 this year. The plan, approved at an executive meeting of the State Council, is intended to boost development in the region, led by the Fujian province, and also to promote cooperation between the region and Taiwan.

According to the minutes of a meeting chaired by Premier Wen Jiabo, the plan represented the "more forceful measures" needed to be taken in light of the recent thawing in cross-Straits relations.

The original blueprint of the Fujian economic zone was featured in China's 11th five-year plan (2006-10) back in 2006. The proposed scheme will now see the zone facing the Taiwan Island across the Straits, and neighboring the Pearl River Delta and the Yangtze River Delta, two of the mainland's economic powerhouses.

Wang Kaiming, a Fujian provincial government-funded researcher for the development research center, said the unique location of the zone gave it a highly significant role in shaping the country's efforts to bolster regional development.

A platform for exchanges

According to the plan, the zone would ultimately become a "frontier platform", boosting industrial and cultural exchanges across the Straits. As part of the initiative, the central government has committed to speeding up infrastructure construction in the region, as well as implementing direct flights, postal and shipping services across the straits.

The Chinese mainland and Taiwan started historic direct flights, as well as postal and shipping links, on December 15, 2008, ending a 59-year ban on such contacts.

Li Fei, a vice-director of Xiamen University's Taiwan research center, said the central government's move to support the zone would create vastly enhanced opportunities for trade and investment with Taiwan enterprises.

Trade between Fujian and Taiwan rose 8.7 percent in 2008 to $7.5 billion. Investment from Taiwan also grew to $2.27 billion, up 25.1 percent year-on-year.

He Xihao, vice-president of the Association of Taiwan Investment Enterprises on the Mainland, said Taiwanese businesses had been expecting central government support for a considerable time.

He also indicated that Taiwan businesses had been keen to tap into the region's development potential. This potential, he said, was underlined by the current success of Taiwan-backed businesses in Fujian's Zhangzhou city, many of which were said to be flourishing despite the adverse trading conditions.

The zone, which also covers parts of the neighboring provinces of Jiangxi, Zhejiang and Guangdong, represents one of the central government's key strategies for the regional development of coastal China.

According to the plan, both the need for regional coordination and cross-province cooperation would be stressed throughout the zone, ensuring accelerated regional development in both urban and rural areas.

Li Fei said: "The economic zone will bring benefits to the neighboring Zhejiang and Guangdong provinces, as well as developing the central and western regions. The zone will also provide an ideal testing ground for a number of innovative economic reforms and incentives."