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Cut our operating costs, leaders forum tells city

SHANGHAI should do more about its relatively high business costs if it wants to attract and keep regional headquarters of multinational companies, business leaders told a forum yesterday.

Manager and entrepreneur attendees agreed that Shanghai was one of the top choices for overseas investment because of its growing economy, sizable market and improved investment environment.

But some said they would prefer other lower-cost cities where they can enjoy the same benefits during the global economic downturn. Intel China said last year it assessed business costs and taxes in some cities in Asia, including China's Chengdu and India's Bangalore. Shanghai was the most expensive for middle- to senior-level staff, said Executive Director Ge Jun.

"Business costs in surrounding areas are less than half compared to Shanghai," said Meng Fanchen, senior vice president of Siemens China.

This applied to most aspects, including blue-collar and white-collar workers, industrial land and workshops, Meng said.

Shanghai's cost disadvantages could be offset if the city applied lower costs found in the hinterland, he added.

The allocation of appropriate resources to business units in different towns in the Yangtze River Delta could sharpen Shanghai's competitive edge, the business leaders said.

"We tried this between Wuxi and Shanghai by not duplicating the management system in Wuxi. But so far integration hasn't been achieved," Meng said.

The government was also encouraged to examine green card policies for foreigners. "Helping spouses find jobs and providing better education for their kids will have a huge impact on luring and keeping talent," said Yan Yumin of the outsourcer Shanghai Foreign Service Company.


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