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UPDATED: August 16, 2009 NO. 33 AUGUST 20, 2009
Chongqing Reviving
Chongqing's economy has withstood the global financial chill and looks to growth

"The financial storm has taken a heavy toll on many enterprises in our industrial parks and they were feeling lost," said Wu Daofan, Director of the Jianqiao Industrial Park Administrative Committee. He said the financial crisis has impacted the park more than anything else since its establishment six years ago.

In the face of the crisis, his committee has decided to spend 1 billion yuan ($147 million) in three years on corporate restructuring and technology updates within the park. The timely measures to resist the crisis have not only provided a cushion for the enterprises, but have also spurred a new round of business startups. From January to April 2009, fixed asset investment in the park amounted to 1 billion yuan ($148 million), a 97 percent year-on-year increase.

Industrial transformation and upgrading

On the slipway of the Dongfeng Shipyard of Chongqing, the biggest slipway in southwest China, four 5,500-ton asphalt tankers and one 5,700-ton chemical tanker are being built. They will hit the water in about a month.

Avoiding direct competition with the main shipyards and reinforcing niche-market exploration of special-type ships have won Dongfeng Shipyard a solid foothold, even during the international financial crisis.

"Special-type ships refer to oil, chemical and ocean-engineering vessels, which usually have relatively small tonnage but high added value. Compared with ordinary bulk cargo and container carriers, special-type ships suffer less from market fluctuations," said He Xiyun, General Manager of Dongfeng Shipyard. "The financial crisis has given us an opportunity—our enterprise is just in time to adjust the product structure, and firmly head for the orientation of high added value and hi-tech ship products."

The international financial crisis has also prompted Chana Auto Co. Ltd., which features auto products under the name Chang'an and is one of the most renowned carmakers in China, to quicken its pace on adjusting its product structure. Construction of a new Chang'an mini-car and engine plant with 2.5 billion yuan ($367,000) investment has commenced in Chongqing's Yuzui Industrial Park.

The new Chang'an mini-van production plant will lay emphasis on energy-saving and alternative energy cars. And it will incorporate solar energy and water recycling to conduct production. After completion of the two-phase project, it will become the largest manufacturing facility of mini cars and power trains, with a production capacity of 600,000 cars and 2 million engines. "Crisis means both challenges and opportunities. For Chana Auto, this is an opportunity to develop mini cars and small-engine cars," said Xu Liuping, President of Chana Group.

Last December, construction of the Hewlett-Packard PC Production Base, which takes up 60,000 square km, began in Chongqing Xiyong Microelectronics Industrial Park. It is estimated that 4 million laptops will be able to be produced after the base becomes operational in 2010, which will also bring a support industry cluster worth 50 billion yuan ($7.3 billion).

Driven by companies like Hewlett-Packard, the electronics industry in Chongqing is expected to become a new pillar of the economy. Statistics show fast growth this year, with sales revenues expected to jump to 80 billion yuan ($11.7 billion) from 60 billion ($8.8 billion) last year.

Livelihood first

The declining economy and increasing unemployment, millions of returned migrant workers, more than 100,000 graduating university students, newly added urban and rural labor and the transfer and settlement of new immigrants have created a complicated picture. It has become extraordinarily difficult to improve people's lives.

Wang Hongju, Mayor of Chongqing, promised earlier this year that improving people's lives would be highlighted in efforts to expand domestic demand. He also said 150 government-led construction projects will be started within the year, each benefiting people directly.

The Chongqing Municipal Government has decided to inject 1 billion yuan ($147 million) to guarantee employment, of which 600 million ($88 million) will be used to either keep or create jobs, 200 million ($ 29 million) will be directed to help university and vocational school graduates find jobs and the rest will go to returned migrant workers.

SOEs of large and medium-size in Chongqing have announced that they will employ no less than 13,000 university graduates this year, doubling the number employed last year. This, they say, will ensure a year-end employment rate of university graduates of about 85 percent.

Within four years since 2008, officials plan to invest 1 trillion yuan ($147 billion) building the municipality into a greener and more livable place.

(This article is based on a news report from People's Daily, originally written by Yu Jijun, Cui Jia and Hou Lulu)

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