Pilot area implements national strategy, elevates opening-up to higher level, through advancing industrial clusters, institutional innovation

The China (Hunan) Free Trade Pilot Zone’s Changsha Area holds a ceremony to launch the construction of its free-trade headquarters base in Changsha, capital of Hunan province, on Oct 12. (PHOTO PROVIDED TO CHINA DAILY)

Changsha, as part of a national pilot free trade zone, is on the way to becoming a global hub for advanced equipment manufacturing, a domestic base of high-end and modern services, and a pilot zone for China-Africa economic and trade cooperation, as it celebrates the first anniversary of the launch of the pilot FTZ. 

Last year, China issued a master plan for three new pilot FTZs in Beijing as well as Hunan and Anhui provinces to elevate the country’s opening-up to a higher level.

The China (Hunan) Pilot Free Trade Zone covers 119.76 square kilometers and consists of three areas, Changsha, Yueyang and Chenzhou in the Central China province. 

Over the past year, the FTZ’s Changsha area has not only served as a pilot zone to implement China’s national opening-up strategy but also injected fresh impetus to regional development. The Changsha area, as part of the FTZ, embraces wider opening-up through efforts in developing industrial clusters, advancing institutional innovation and optimizing the business environment. 

The Changsha area of the China (Hunan) Pilot Free Trade Zone consists of five blocks covering a total area of 79.98 square kilometers. (PHOTO PROVIDED TO CHINA DAILY)

Industrial cluster

The Changsha area has an advantage in advanced manufacturing industry, as it is home to several global top 50 construction machinery manufacturers, such as Sany Heavy Industry, Zoomlion, China Railway Construction Heavy Industry and Sunward Intelligence.

After years of development, Changsha has become the world’s third-largest cluster of construction machinery industry, behind only to Illinois in the United States and Tokyo in Japan. 

The industrial cluster has expanded this year, as equipment manufactures, including Hangcha Group, a leading global material-handling equipment manufacturer, moved their headquarters to Changsha. Meanwhile, major projects with an investment of more than 10 billion yuan ($1.56 billion) have also injected new momentum into the industry. 

Changsha is one of the key cities involved in the building of the Belt and Road Initiative and the development of the Yangtze River Economic Belt. The city has capitalized on various opportunities brought by such national strategies to become a hub for cross-border delivery services and international trade. 

A file photo of Changsha Huanghua Comprehensive Free Trade Zone. (PHOTO PROVIDED TO CHINA DAILY)

In the first half of this year, the total export volume for each of Changsha’s three leading advanced equipment manufacturing enterprises — namely Sany, Railway Construction and Sunward — all grew by more than 50 percent. 

On Aug 26, a freight train of China Railway Express departed from Changsha’s Kaifu district and arrived in the Belarusian capital of Minsk in about two weeks. 

The China-Europe freight train took with it a broad spectrum of products, including construction machinery manufactured by companies like Sany and Zoomlion as well as communications equipment, household appliances, food and other daily necessities. This batch of goods, loaded in 100 standard containers, weighs 710 metric tons and has a total value worth $4.38 million.

Liang Jingbo, deputy general manager of the Central South China International Land Port, said, “There are now about four freight trains running between China and Europe every day, and the daily maximum number may reach six.”

Liang said the freight trains have played an important role in serving enterprises in the FTZ area so that they can buy and sell goods worldwide.

The China-Europe freight train therefore serves as a huge boost to international trade. The transport network will expand with the launch of more trains, linking dozens of cities around the world.

A China Railway Express freight train departed from Changsha’s Kaifu district on Aug 26, for Minsk, capital of Belarus. (PHOTO PROVIDED TO CHINA DAILY)

Institutional innovation

Zheng Jianxin, mayor of Changsha, said Changsha has also made great efforts to promote institutional innovation and implement reform measures during the past year. 

Thanks to the FTZ’s institutional innovation, idle secondhand construction machinery exploits new opportunities abroad, contributing to 60 percent of energy saving and 70 percent of material saving. 

In October, Sunward Intelligent declared at the customs a batch of secondhand equipment scheduled to be exported to Uganda in early November. 

When completed, this would be the first order favored by the FTZ’s new policy, which specifies that secondhand construction machinery equipment can enjoy export tax refunds as those brand-new ones. The policy has significantly increased the enthusiasm of enterprises to export such equipment. 

Even before the new policy was launched, Sunward once exported 10 sets of rock-drilling equipment to the African market to boost cooperation under the Belt and Road Initiative.

A foreigner gets his document from the One-stop Service Center in the Changsha area. (PHOTO PROVIDED TO CHINA DAILY)

The Changsha area has been taking the lead in exploring a feasible mechanism for the export of construction machinery, through establishing a set of standards and rules governing practices including quality tests, certification and after-sales services.

To build a better FTZ, a package of supporting policies is in store for talents, scientific research, industrial development and opening-up. Optimizing the business environment for market entities and individuals, among other things, is at the top of the FTZ’s agenda. 

On Oct 29, an all-around service center opened to foreigners who intend to work or continue their work in the Changsha area to provide them with facilities and services. 

Before foreigners start their work or business in Changsha, they need to obtain an international travel health certificate, a work permit and a residence permit. 

These documents, which used to be issued by different government departments such as customs and public security, are now all available at the one-stop service center. As the procedures are optimized and simplified, it’s easier for foreigners to get things done. 

The smart workshop in Sany Heavy Industry is Asia’s largest intelligent manufacturing workshop, with well-organized robots automating the entire production process. (PHOTO PROVIDED TO CHINA DAILY)

Tim Armstrong, from New Zealand, is the foreign director of an international kindergarten in Changsha and has been in China for 10 years. He said, “It used to take about one month to get all the documents, but now it only takes a week or so. It’s much more convenient and friendly.” 

Thanks to the all-around efforts,  the Changsha area has built a better business environment. 

Over the past year, more than 3,000 enterprises were newly have been established in the FTZ area and an additional 12,000 new market entities also settled in.

The Changsha area also welcomed 74 projects with a total investment of 175.13 billion yuan. Meanwhile, its total import and export volume has reached 71.28 billion yuan.

Feng Zhiwei and Zhu Youfang  contributed to this story.