On March 10, dozens of Chinese and foreign experts gathered at the Diaoyutai State Guesthouse in Beijing for a high-level forum on financial back-office service sector development trends and opportunities in the context of the financial crisis.

This was the second forum of its kind held by Huaqiao International Service Business Park, the first was held in Lujiazui of Shanghai last December. Zhang Guohua, Secretary of the Party Committee of Kunshan City and Secretary of the Party's Working Committee of Huaqiao Economic Development Zone, said, "As China's first development zone specializing in the modern service sector, Huaqiao is striving to become a first-rate industrial base for financial business process outsourcing (BPO) industrial base in China or China's 'Golden Valley.'"

Over 20 enterprises have set up their Chinese headquarters or east China headquarters in Huaqiao, including BPO giants Capgemini of France and China Data Group. Large logistics companies, such as Prologis, Blogis and New City Group, have also settled in Huaqiao.

Located in the city of Kunshan, Huaqiao International Service Business Park is not far from Shanghai. It took less than four years to complete the building of this modern service zone in Kunshan from scratch. So far, the business park has launched a total of 225 service industry projects, of which over 80 are large-scale modern service projects, involving a total investment of over 30 billion yuan. The rise of Huaqiao is not coincidental. Ren Xueyuan, Director of the Administration Committee of Huaqiao International Service Business Park, believes that the advantageous geographical proximity to Shanghai, the incentive policies of Jiangsu Province and the cost advantages in Kunshan enjoyed by Huaqiao as well as the regional industry support have created Huaqiao's "unique" competitiveness in developing the modern service sector.

Under the administration of Jiangsu Province, Huaqiao enjoys geographical proximity to Shanghai. It is only 25 kilometers from People's Square in Shanghai, 20 kilometers from Shanghai Hongqiao Transport Hub and 80 kilometers from Shanghai Pudong International Airport. In the next few years, there will be three new transportation routes connecting Huaqiao with Shanghai. One of these is Shanghai's No.11 metro line, which is planned to begin operation this year. The line's terminal is only about 300 meters from the office building of Huaqiao's Administration Committee. As the costs of doing business in Shanghai keep rising, Huaqiao International Service Business Park's costs advantages in terms of production, including land, real estate and labor, hardware costs of infrastructure and projects construction and software costs of government services will become increasingly clear. Huaqiao is already a well-established industrial base. Investors from 55 countries and regions have launched over 5,000 foreign capital-funded projects. Kunshan features over 18,000 private companies. The vibrant growth of the local manufacturing sector has generated an ever-increasing demand for modern services.

Moreover, Huaqiao International Service Business Park is a provincial development zone as well as an international BPO base. It is also listed as a key modern services project by the Jiangsu Provincial Government. In addition to giving Huaqiao the economic incentives for provincial development zones and for the development of the modern service sector in Jiangsu, the Jiangsu Provincial Government has promised to grant the service business park maximum support in terms of capital, land and taxation.

Last year, Capgemini, the world's leading technical consulting, management consulting and BPO services provider, set up its delivery center for Greater China in Huaqiao and set up a BPO base in Huaqiao with registered capital of 200 million yuan.

BPO, company headquarters and modern logistics are Huaqiao's most sought-after forms of investment. "As far as Huaqiao's industrial development is concerned, financial BPO is one of the sectors that are more competitive and most likely to achieve cluster advantage," said Ren. Huaqiao International Service Business Park has attracted 12 relatively large BPO companies, involving a total investment of 8 billion yuan. A breakthrough has been made in financial BPO, with a large number of financial BPO companies settling in Huaqiao. These include Capgemini, China Data Group, Centrin Data Systems, Yuanyang Data Processing Co., Ltd. and Tangram, which form a relatively complete financial BPO industry chain.

China Data Group, which tops the list of China's ten largest BPO companies, signed a contract to establish a branch in the Huaqiao International Service Business Park last June. Yang Peng, CEO of China Data Group, said, "Huaqiao has offered an opportunity for China Data Group to develop its financial BPO global strategy. Huaqiao is about to become China's most influential financial back-office services base. In five years, China Data Group plans to become one of the ten largest financial BPO companies in the world."

Reporters learned from interviews that Huaqiao International Service Business Park has a clearly defined "three-step" plan in developing its financial BPO sector. This involve gradually generating a financial BPO industry chain; accelerating the introduction of upstream and downstream projects of the financial BPO sector, especially large projects to make up shortages in Huaqiao; and encouraging investors in Huaqiao to bring in new companies to form a financial BPO industry chain, complete with low-end, middle-end and high-end companies. Huaqiao intends to become a complete industry base by taking advantage of Shanghai's plan to build itself into an international financial center hub and introducing projects involving banking client centers, R&D centers, accounting centers and IT and data processing centers to Huaqiao and accelerating the construction of credit card centers, disaster recovery centers, shared back-office service centers and client call centers.

Huaqiao plans to boost its total revenue, with an annual revenue target of 10 billion yuan to be achieved within three years. The planned 2.5-square-kilometer financial BPO industry base is planned to eventually become China's "Golden Valley."

By 2011, the Huaqiao International Service Business Park will possess a financial and BPO industry chain including high-end, middle-end and low-end companies, and will have a total capacity of 50 billion yuan. By its ten-year anniversary, the service business park will be a leading financial BPO industrial base represented by knowledge-intensive and technology-intensive companies, with its total production capacity reaching 100 billion yuan.

Source: Jiangsu Economic Daily Page A1 Reporter: Yuan Furong