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The Binhai New Area (BNA) in the port city of Tianjin is arguably the most profitable economic zone in the country and promises sustained growth for investors, national legislator Pi Qiansheng said yesterday.

 

The chairman of the BNA Administrative Commission said foreign industrial companies in the area have posted an average of 8 percent profit over the past few years, and the momentum would continue in the years ahead.

 

In particular, IT businesses have notched up 12 percent profit margins, compared with an average 5 percent in the country, said Pi, also a key policy-maker of the Tianjin municipal government.

 

With an area of 2,270 square kilometers and a population of 1.4 million, BNA is a growth engine for North China and is widely expected to match the economic miracle achieved by Shanghai's Pudong New Area, whose land area covers 533.44 square kilometers and is inhabited by 2.8 million people.

 

The BNA is home to Tianjin Port, the Tianjin Economic and Technological Development Area, the Free Trade Zone and the administrative districts of Tanggu, Hangu and Dagang; and its coastline stretches 153 kilometers.

 

The area got a shot in the arm last Sunday when Premier Wen Jiabao singled it out and vowed to promote its development when he delivered his government work report at the opening of the National People's Congress annual session.

 

"We have always worked to improve the investment environment by helping reduce business operation costs," Pi told China Daily on the sidelines of the session.

 

For example, the prices of water, electricity and gas have been raised many times over the past years in Tianjin but have remained unchanged for years in BNA, he said.

 

BNA offers low rentals and refunds part of the taxes to encourage research and development (R&D) by high and new-technology industries and "bellwethers" in machinery, electronics and food sectors, Pi said.

 

"With favorable conditions created by the BNA, enterprises will have a reliable guarantee for growth," Pi said. "I believe profitability will be stable and continue in the years ahead."

 

Pi said he believed the area is well positioned to absorb US$20 billion of foreign investment in the next five years, when the number of companies set up by top global enterprises will increase from 152 to at least 300.

 

At least 70 of the world's top 500 companies have established a foothold in the area and poured in US$26 billion over the past decade. An additional 80 of the top 500 are expected to have a presence by 2010, he said.

 

Infrastructure facilities will be strengthened to meet their growing needs.

 

Tianjin is upgrading Binhai International Airport to a North China air hub: passenger volume is expected to surge from 2.15 million in 2005 to 6.5 million in 2010; and cargo shipments will jump from 96,000 tons to 500,000 tons during the same period, he said.

 

The completion of an express train line by June 2008, just before the Beijing Olympic Games, will link the city to the capital with a half-hour ride.

 

"In the short run, the integration of air traffic service in Tianjin and Beijing will contribute to the Olympic Games; in the long run, it will make BNA into a transport centre in North China," he said.

 

At the ongoing National People's Congress annual session, Pi said he proposed building an oil reserve base in the area.

 

For one thing, proven oil reserves in the Bohai Sea area are 3.2 billion tons, and Tianjin Port is being revamped for use of 300,000-ton oil tankers. In addition, oil pipelines have been laid from the port to many regions, he said.

 

(China Daily March 10, 2006)