Fujian Province in south China recently put forward targets to develop a new economic zone on the western side of the Taiwan Straits, or the Western Straits Economic Zone. The zone's GDP is expected to reach 4 trillion yuan ($586 billion) by 2020.

The State Council, China's cabinet, passed a plan in May to support the development of the Western Straits Economic Zone, which was established last year when the mainland and Taiwan accelerated economic relations.

The Western Straits Economic Zone, centered in Fujian Province, neighbors the Pearl River Delta and the Yangtze River Delta, two economic powerhouses on the mainland. It covers part of the neighboring provinces of Jiangxi and Guangdong, and faces Taiwan Island across the straits.

Lu Zhangong, Secretary of the Provincial Party Committee, urged the economic zone to accelerate its construction recently at the Sixth Plenary Session of the Eighth Congress of the province . During that session, the congress approved a plan to develop the zone.

According to the plan, per-capita GDP in the zone is slated to approach or reach the level of east China by 2012, and quadruple that of 2000 in 2017. The total GDP of the zone is to reach 4 trillion yuan in 2020. Local fiscal revenue will set a record of 10 billion yuan ($1.46 billion) in 2012, and the zone will take the lead to realize a moderate prosperity three years ahead of the whole country.

Fujian and Taiwan have close economic cooperation. Together, they made a breakthrough in regional collaboration, and they are constantly strengthening their economic might through steady expansion of their ports, cities and industries.

Fujian has now basically developed into a province that features thrift of resources, a friendly environment and vigorous innovation.

A scholar who wished to remain anonymous told China Business News that Fujian's economic growth rate has to outstrip 12 percent to reach its targets. "In recent years, the gap between economic aggregates in Fujian and Taiwan has been narrowing, with the ratio shrinking from 1 to 40 some 30 years ago to 1 to 2.5 in 2008," he said.

In recent years, Fujian has enjoyed double-digit economic growth. Its total GDP surpassed 1 trillion yuan in 2008, growing by 12.4 percent, which enabled it to become a new member of the "Trillion GDP Club" in China. In the first six months of this year, its economic growth remained at a rate of 8.5 percent, higher than the national average.

The plan, which will undergo some revision before it is put in place, also includes a series of measures in terms of cooperation between the two sides of the Taiwan Straits.

Some preferential policies for Taiwan businesses have been set to encourage them to invest in Fujian. A clearance center will be set up to promote offshore financial services, while a mechanism to coordinate tax payment will help businesses avoid being taxed repeatedly by both sides.

Streamlined customs clearance procedures will facilitate travel between the two sides. Opportunities will be explored for Taiwan residents to participate in entrance exams to be public servants at Fujian provincial administrative departments or grassroots social public management services.

To promote direct flights between the two sides of the straits, Fujian will arrange more direct flights to Taiwan at the Xiamen and Fuzhou airports, and will add another two airports – Wuyishan and Jinjiang – providing direct flights.

The province will also promote the supply of water and electricity to Jinmen and Mazu in Taiwan and lay a communication cable under the sea.

Various groups in Fujian will visit Taiwan to promote economic cooperation and cultural exchanges between the two sides. So far this year Taiwan has received five project-inspection groups covering the fields of auto electronics, hi-tech parks, iron and steel, petrochemicals and food processing. The latter half of this year will see eight more groups visiting Taiwan.

(Source: China Business News, edited by LI YUZHU)