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CHINA> Regional
Powerhouse 'on track' for double-digit growth
By Chen Hong (China Daily)
Updated: 2008-11-27 07:40

SHENZHEN: The country's economic powerhouse of Shenzhen will be able to maintain double-digit growth this year despite the global financial crisis, Mayor Xu Zongheng said in a press conference Wednesday.

"We have been taking a series of countermeasures since the beginning of this year and adjusted investment plans across-the-board in April, which allowed the city to achieve 11.5 percent growth for the first nine months. We are expecting to hit the projected 12 percent of economic growth for the full year," Xu said.

The countermeasures highlighted include the setting up of special funds to facilitate the financing of small and medium-sized enterprises, accelerating structural adjustment of export products, plugging problems of land shortage for the companies and improving government services, the mayor said.

The government foresaw the current economic challenges at the beginning of the year and took "timely measures" to cope with them, Xu said.

Similarly, while the global financial crisis has had an "apparent and intensive" impact on the city's exports, which account for nearly one-seventh of the country's total exports, it did not shake the city's "solid industrial foundation", Xu said.

A total of 682 companies have shut in Shenzhen since the beginning this year, the mayor said. The companies could have generated an accumulative industrial added value of 2 billion yuan ($293 million), accounting for just 0.15 percent of the city's total industrial added value last year.

"These closures are impossible to upset the industrial development trend of Shenzhen," Xu told reporters.

A majority of the bankrupted companies were engaged in the traditional processing industries, including garments, furniture, plastics, hardware and electronic assembly.

About 60 to 70 percent of these companies reportedly could not survive because of rising costs and steeper price competition in the global market - also as a result of the financial crisis and appreciation of the yuan. Another 20 percent of the businesses closed because of illegal operations, while 10 percent bowed to fierce competition.

At least 50,000 workers were said to have lost their jobs from the closures.

The authorities would help workers get back their owed wages and pay them through a social security fund if necessary, Xu said.

 

 

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