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Iron and steel project to fuel Zhanjiang's development

By Li Jing (China Daily)
Updated: 2008-05-26 14:03

"We used to have a certain sense of superiority as Zhanjiang was a hot destination for investment in the early 1990s," says Zheng Zhou, a local businessman selling shipping accessories. "Yet this superiority failed to generate substantial benefits for local people. For instance, the 1.3-billion-yuan bridge over the Zhanjiang Bay was finished two years ago, but I didn't see it bring any changes."

Yu attributes Zhanjiang's slump to out-dated management concepts. In his opinion, constructing roads and setting up factories is far from enough. The city has to find its own way.

Based on his research and investigation, Wang Yang, Party chief of Guangdong province, concludes that "Zhanjiang deserves better". He poses a question at the same time: how could Zhanjiang capitalize on its resources as a port city and achieve more marine industries?

Activating the port economy

The State Council approved an expansion plan for Zhanjiang Economy and Technology Development Zone in 2006, which doubled the total area to 19.2 sq km.

While retaining the development of biochemistry, materials and automobile manufacturing in the original site, Zhanjiang government is now focusing on setting up a coastal petrochemical base in the new area.

Zhanjiang has initiated cooperation with major domestic oil companies including China National Offshore Oil Corp (CNOOC), China National Petroleum Corp (CNPC) and China Petrochemical Corp (Sinopec).

However, what bothers Yu is that Zhanjiang's advantage as a port city still has not been fully displayed. "The port is always hungry for cargos," says Yu.

Zhanjiang faces South China Sea in the east and Hainan province across the Qiongzhou Strait, adjacent to Beibu Bay in the west, and borders the Guangxi Zhuang Autonomous Region in the northwest. The geographical location makes it an ideal hub port in southwest China, providing the shortest waterway from the mainland to Europe, Africa and Southeast Asia.

The inner coastline of Zhanjiang Port reaches 241 km, four times that of Rotterdam - the largest port in the world. It also boasts China's first 300,000-ton ashore crude oil terminal and Asia's deepest 250,000 ton manmade waterway.

But the problem is that few vessels use the port. "There are at best two large vessels entering the port everyday," says a source from Zhanjiang's harbor bureau.

"The current situation is that we have a large port, but few vessels. Failed trade relationships with other international ports has resulted in a bottleneck for Zhanjiang port's development." Yu says.

Baosteel's iron and steel base may bring hopes to rejuvenate Zhanjiang port. The first phase of the project is expected to attract an investment of 69 billion yuan.

The iron and steel project will provide about 150,000 job openings, which is a huge push for local economic development, according to a source from the Zhanjiang Bureau of Land and Resources. More important, the project will mobilize the different enterprises along the industrial value chain, which serves as a strong impetus for the whole Zhanjiang development zone, the source says.

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