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Financial service backs up TEDA’s growth

Updated: 2010-06-17 12:58

Well known as a veteran manufacturing powerhouse, the Tianjin Economic-Technological Development Area (TEDA) is in pursuit of another new growth engine, which, in return, fuels the area’s existing production muscle.

The high-profiled new growth engine refers to the financial industry, which composes a core part of the modern service industry of TEDA.

In line with TEDA’s long-term plan, the area will focus on the TEDA Financial District and the Modern Service District（MSD）for modern service industry development, especially for the financial industry, which is pinpointed to lay strong supports for the further growth of TEDA’s manufacturing industries.

TEDA is determined to accommodate more finance and commerce businesses, information and logistics enterprises, which are closely associated with the manufacturing industry. Solidly based on the concentration of manufacturing industries within Tianjin Binhai New Area (TBNA), these financial businesses will fuel further growth of production-oriented companies in return and facilitate industrial gathering and consolidation.

The MSD will harbor service-oriented businesses, such as finance, insurance, R&D and designing, modern commerce and logistics, and cultural and creative businesses as well.

With the construction of MSD in full swing, TEDA will provide facilities and create a sound environment for headquarter business and high-end modern service industry development. The district will actively absorb and encourage multinationals, State-owned enterprises, private firms and renowned associations from both within China and abroad to set up regional headquarters and functional headquarter organizations, such as R&D centers, sales and purchase centers, financial administration centers, settlement centers, logistics centers and cost-profit accounting centers.

TEDA will push forward various financial pilot projects, concerning industrial-oriented private equity funds, venture capital, comprehensive operation of financial businesses, multiple-ownership financial enterprises, policies concerning foreign exchange administration and off-shore financing.

TEDA is expected to pool various categories of exchange, markets and non-bank businesses and corporations, including factoring companies, bonding corporations, financing and leasing businesses, small credit firms, finance companies, financial leasing firms, etc. Headquarters of these financial businesses and institutions are especially welcome.

Priorities will be granted to banks and non-bank financial institutions, such as insurance firms, securities, funds, trust companies, bonding firms, investment firms, and automotive credit companies for fast registration and development.

Top priority will go to financing and leasing, shipping finance, insurance and private equity funds. Innovation and business upgrading will be encouraged within these segments in TEDA.

In fact, TEDA, as a traditional manufacturing hub, has also witnessed a booming financial business on its own turf.

By the end of 2009, there were a total of 34 banking institutes stationed in TEDA, 25 of which are Chinese Banks with 81 outlets, and nine foreign ones, including 1 branch bank, 7 sub-branch banks, and 1 representative office (sub-branch banks of HSBC from Hong Kong, Citi Bank from US, Chohung Bank from South Korea, The Bank of Tokyo-Mitsubishi UFJ from Japan, Branch of Mizuho Bank from Japan, Sumitomo Mitsui Bank from Japan, Standard-Charter Bank from US, Shinhan Bank from Korea, and representative office of State Bank of India).

Also, there are six securities companies located at TEDA, including Bohai Securities, Huaxia Securities, Changjiang Securities, China Merchants Securities, China Galaxy Securities and Qilu Securities. Altogether 11 insurance companies have been established in TEDA, such as Ping An Property Insurance, Tai Ping Insurance, PICC, Ping An Life Insurance, China Pacific Life Insurance and China Life Insurance.

TEDA is also home to two factoring companies, six investment and bonding companies, one future broker, five finance companies, one trust company and 20 finance service agencies, such as Motorola (China) Finance, ICBC Finance Leasing, Tianjin Climate Exchange, Financial Disputes Arbitration Center, established within this domain.

As a key port city, Tianjin is distinguished from other North China cities by its huge foreign investment inflow and dynamic growth momentum. Statistics over the years demonstrate clearly that the Foreign Direct Investment (FDI) in China has been growing at a sustained and fast pace. Nowhere is this more true than at TEDA, where many of its investors are committed multinationals. Now this front runner in FDI absorption is upgrading from a conventional manufacturing center to a hub of modern financial services. TEDA intends to offer high-standard services in this regard.

TEDA has attracted a large number of multinational companies featuring advanced productivity. By the end of 2009, TEDA had attracted 4734 foreign enterprises, with an accumulated total investment of US$53.796 billion, a total contract foreign investment of US$40.537 billion and an actual investment in place of US$2.548 billion. In addition, there are 8830 domestic-funded enterprises in TEDA, with registered capital of 130.912 billion yuan. In all, 76 multinational companies out of the "Fortune" 500 companies have invested 158 enterprises in TEDA.

TEDA has grown into a major hub for high-end manufacturing, after 25 years of development. There are nine pillar industries taking shape within TEDA, including the telecommunications industry represented by Motorola and Samsung Group; automotive & machinery manufacturing industry led by FAW-Toyota; food & beverage industry with Nestlé and Ting Hsin as representatives; bio-pharmaceutical industry led by Novonordisk and Novozyme; aerospace and aviation industry represented by the carrier manufacturing base; new material and alternative energy industry led by Vestas and Dongqi Wind & Electricity Power; petro-chemical industry led by China National Petroleum Corporation(CNPC),China Petroleum Chemical Corporation(CPCC) and China National Offshore Oil Corporation(CNOOC); machinery manufacturing industry represented by SEW and Otis, and modern service industry represented by China Soft International, Zoomlion, Tokyo Tatemono and CCB International.

Along with the concentration and development of high-end modern manufacturing facilities at TEDA, the demand for various related financial services is becoming more prominent, which can help enterprises save operating costs, improve centralized management and seek reasonable labor division.

Enterprises are in desperate need of services regarding financing, financial management, industrial insurance and equity trading needed for business reshuffling and mergers and acquisitions.

On the other hand, the financial business also has to base its development on the growth of manufacturing industry at TEDA.

There are over 200 high-tech-oriented enterprises, which are under healthy asset conditions at TEDA. All of these companies are potential customers for capital operations, such as mergers and operations and investments.

By Rong Xiaozheng and Wang Yu