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China Daily Website

Wet weather fails to dampen FTZ interest

Updated: 2013-10-08 23:49
By Wei Tian in Shanghai ( China Daily)

Wet weather fails to dampen FTZ interest

People interested in registering businesses in the Shanghai Pilot Free Trade Zone throng the service and administration center of the FTZ on Monday. Photo provided to China Daily

The wet and windy weather in Shanghai failed to dampen enthusiasm for the Shanghai Pilot Free Trade Zone, with many companies more than happy to take advantage of the reforms on offer, registering with the experimental zone as soon as it began operations on Monday.

The eastern China city issued a red alarm for rainstorms in the morning caused by typhoon Fitow but No 9 Jilong Road in the Waigaoqiao area, where the service center and administration office of the FTZ is located, thronged with people from the 9 am opening.

Sun Baohua from Wenzhou, Zhejiang province, was second in the line up. His application for opening a small financial services company in the FTZ was handed in at 10 am and he was told the documents could be ready by next Tuesday.

"I stayed in Shanghai during the entire National Day holidays and came here at 7 am," Sun said, adding that he was expecting his new business could benefit from Shanghai's promise to push forward financial reform and market-oriented interest reform.

"By lunch break, we had already had more than 800 people coming in to consult or conduct actual transactions," said Chen Weimin, a consultant with the general administration office of the FTZ. Even over last week's National Day holidays, the center received an average of 700 inquiries a day, Chen added.

When the center was closed on Monday afternoon, it had received a total of 1,400 inquiries and had processed more than 500 applications, according to Chen.

Monday was the first day for the Shanghai FTZ to be officially put into operation, after the 28-square-kilometer pilot area, which is expected to be a major plank of China's next step toward economic reform, was unveiled on Sept 29.

On Sept 26, a general development plan was released to lessen the restriction on 18 sectors in the FTZ that were previously regulated, such as healthcare insurance and game console sales.

In addition, after the FTZ was launched on Sept 29, a negative list consisting of 1,069 items was made available for foreign investors. This was seen as an innovative management approach which opens the door to foreign investment from any sectors not on the list.

However, most of the visitors to the service center on Monday were Chinese businesses. Foreign faces were a rare sight in the hall, although Chen said they have actually received quite a number of inquiries from foreign investors both online and offline.

He explained registering a foreign-funded company would involve checking with the negative list, leading to more procedures. "It was just the first day for the center to operate. I think many foreign companies are still sitting on the fence at the moment. But I believe we will finally get there," he said.

It seemed fence-sitting wasn't a bad choice at all because many of the domestic applicants also came in unprepared. Luckily for them, the center had set up one-to-one inquiry desks on the second floor to answer specific technical questions.

Intermediary agencies for company registration were also easy to identify in the center. They will help with all the processes but at a cost: 3,000 yuan ($490) for company registration and 20,000 yuan for renting an office registration address for a year.

"Trading, e-commerce and financial services were currently the three hottest sectors for company registration in the FTZ," said Zhu Lin, an agent who was trying to attract customers at the entrance of the center all morning.

"Sometimes you have to go to one of these agents because otherwise it would be very hard to get yourself an office," said a young manager of a State-owned trading company, who asked not to be identified.

 
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