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Foreign firms get helping hand
September 17, 2011, Saturday
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THIS is Hangzhou's annual services month when foreign companies get extra help and answers on financing, taxation, rising labor costs and other issues. Winnie Wang reports.
Hangzhou is actively helping foreign companies based in the city in a campaign to attract more overseas companies, retain them and support their expansion. Helping them with financing is a major issue.
The 8th annual Foreign-invested Enterprises Service Month is underway through September 23, assisting companies with multiple questions about operating in Hangzhou. At the end of June, 10,832 foreign-invested companies had been set up in Hangzhou, with a total investment of US$89.4 billion, a sign of the city's efficiency and sound business environment.
More than 300 foreign companies took part in a policy consultation fair. They raised nearly 96 questions about financing, rising labor costs, equity transfer, project approval, government support and education for foreign children, according to the Hangzhou Foreign Trade and Economic Cooperation Bureau, which is in charge of the service campaign.
Almost 40 government departments, including the Hangzhou Tax Bureau and Hangzhou Customs, attended the consultation to offer services to foreign firms, seven more departments than last year.
"Difficulty in financing is a key problem holding back development of foreign companies this year, especially smaller ones, as the country has raised the bank reserve requirement ratio several times this year to cool off lending," said Lin Ge, vice director of the Hangzhou Foreign Trade and Economic Cooperation Bureau.
China has raised the interest rates three times so far this year to tame inflation, and it has hiked reserve requirement ratios six times, requiring commercial banks to put aside more money as reserves, instead of lending.
The bureau and Uni-Power Group, a financial service provider, have formed a financing platform to serve small and medium-sized foreign enterprises, which are usually refused loans by banks, Lin said.
Uni-Power also held an event to discuss funding support, attended by more than 100 foreign firms.
In Zhejiang Province, 63 percent of small companies require financing, and 76 percent of them need no more than 1 million yuan, according to a report by the National School of Development and Alibaba.com Corp.
Lin said the city's foreign trade bureau is also developing a fund, involving both government funds and bank lending, to support smaller companies, especially those that are innovators in the cultural field or outsourcing companies.
In the first half of this year, the Hangzhou government approved 251 foreign-invested projects with contract investments totaling US$3.07 billion, rising 13.1 percent from a year earlier, and registered capital totaling US$3.34 billion, gaining 12.15 percent, according to the bureau.
"Foreign investors chose Hangzhou because of the government's high efficiency and sound environment. Advanced manufacturing and modern service industries are still the two key sectors that draw foreign investments," Lin said.
Since foreign capital has a great influence on the local economy, the Hangzhou government gives a high priority to attracting investment. The annual service campaign has been held since 2004 to improve the city's business environment for foreign investment and trade.
A man surnamed Ren who works at a German outsourcing company got his problems solved at the consultation fair.
"Since our company deals in exporting software via the Internet, I asked the Hangzhou Customs and Foreign Exchange Department about the settlement of foreign currency exchange and got answers," Ren said.
"We can save a lot of time by attending the policy consultation fair since government departments here can offer me almost all information I want."
A Hangzhou Tax Bureau official told Shanghai Daily that besides face-to-face communication at the fair, the bureau has launched an online service to inform companies about detailed procedures.
"We also provide door-to-door service for big foreign companies to inform them about the taxation system," the official said.
In addition to the services month, the Hangzhou Foreign Trade and Economic Cooperation Bureau also offered training. In 2009 it launched the Foreign-invested Enterprises Service Platform to educate foreign investors. It provides a channel for foreign investors to learn about Chinese policies and interact with various bureaus.
The platform, based on QQ, has attracted more than 1,300 foreign companies in Hangzhou and 8,545 questions have been answered on the platform.
Hangzhou is actively helping foreign companies based in the city in a campaign to attract more overseas companies, retain them and support their expansion. Helping them with financing is a major issue.
The 8th annual Foreign-invested Enterprises Service Month is underway through September 23, assisting companies with multiple questions about operating in Hangzhou. At the end of June, 10,832 foreign-invested companies had been set up in Hangzhou, with a total investment of US$89.4 billion, a sign of the city's efficiency and sound business environment.
More than 300 foreign companies took part in a policy consultation fair. They raised nearly 96 questions about financing, rising labor costs, equity transfer, project approval, government support and education for foreign children, according to the Hangzhou Foreign Trade and Economic Cooperation Bureau, which is in charge of the service campaign.
Almost 40 government departments, including the Hangzhou Tax Bureau and Hangzhou Customs, attended the consultation to offer services to foreign firms, seven more departments than last year.
"Difficulty in financing is a key problem holding back development of foreign companies this year, especially smaller ones, as the country has raised the bank reserve requirement ratio several times this year to cool off lending," said Lin Ge, vice director of the Hangzhou Foreign Trade and Economic Cooperation Bureau.
China has raised the interest rates three times so far this year to tame inflation, and it has hiked reserve requirement ratios six times, requiring commercial banks to put aside more money as reserves, instead of lending.
The bureau and Uni-Power Group, a financial service provider, have formed a financing platform to serve small and medium-sized foreign enterprises, which are usually refused loans by banks, Lin said.
Uni-Power also held an event to discuss funding support, attended by more than 100 foreign firms.
In Zhejiang Province, 63 percent of small companies require financing, and 76 percent of them need no more than 1 million yuan, according to a report by the National School of Development and Alibaba.com Corp.
Lin said the city's foreign trade bureau is also developing a fund, involving both government funds and bank lending, to support smaller companies, especially those that are innovators in the cultural field or outsourcing companies.
In the first half of this year, the Hangzhou government approved 251 foreign-invested projects with contract investments totaling US$3.07 billion, rising 13.1 percent from a year earlier, and registered capital totaling US$3.34 billion, gaining 12.15 percent, according to the bureau.
"Foreign investors chose Hangzhou because of the government's high efficiency and sound environment. Advanced manufacturing and modern service industries are still the two key sectors that draw foreign investments," Lin said.
Since foreign capital has a great influence on the local economy, the Hangzhou government gives a high priority to attracting investment. The annual service campaign has been held since 2004 to improve the city's business environment for foreign investment and trade.
A man surnamed Ren who works at a German outsourcing company got his problems solved at the consultation fair.
"Since our company deals in exporting software via the Internet, I asked the Hangzhou Customs and Foreign Exchange Department about the settlement of foreign currency exchange and got answers," Ren said.
"We can save a lot of time by attending the policy consultation fair since government departments here can offer me almost all information I want."
A Hangzhou Tax Bureau official told Shanghai Daily that besides face-to-face communication at the fair, the bureau has launched an online service to inform companies about detailed procedures.
"We also provide door-to-door service for big foreign companies to inform them about the taxation system," the official said.
In addition to the services month, the Hangzhou Foreign Trade and Economic Cooperation Bureau also offered training. In 2009 it launched the Foreign-invested Enterprises Service Platform to educate foreign investors. It provides a channel for foreign investors to learn about Chinese policies and interact with various bureaus.
The platform, based on QQ, has attracted more than 1,300 foreign companies in Hangzhou and 8,545 questions have been answered on the platform.
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