China's Vice-premier Zhang Dejiang (center) visiting the Guangdong High-Tech Service Zone for Financial Institutions, which has received tremendous support from the government. Photos Provided to China Daily

The Guangdong High-Tech Service Zone for Financial Institutions, in Foshan, Guangdong province, is becoming more confident in its strategy to develop back-office operations while exploring front-office ones, a zone official has said.

The zone is in the Nanhai district of Foshan, just next-door to Guangzhou, the provincial capital, which is close to Hong Kong.

"The strategic adjustment of the global financial business, the economic integration between Hong Kong and Guangdong province, and the integration of Guangzhou and Foshan are all coming together to bring unprecedented historical opportunities for the provincial zone's development," the administrative committee official said.

"We'll be making a greater effort to remove the constraints of the existing system and place greater importance on innovation."

As regards the back-office operations, the zone will look for investment in such financial projects as R&D centers for financial products, clearing and settlement centers, financial information and consulting centers, and wealth management service centers.

It wants to set up a regional site for financial innovations in South China and increase the number of innovative financial products and innovation itself.

In the area of front-office operations, it intends to turn itself into a preferred destination in China for private-equity (PE) funds and venture capital (VC).

Another focus of the zone's administrative committee is incentives to attract high-caliber professionals, building up its human resources, and improving the infrastructure for financial information exchanges.

"We expect a modern financial back-office service center and a zone for the nation's top PE and VC companies that can influence the entire Asia-Pacific region to take shape by 2015," the official remarked.

Also by 2015, zone officials expect to have 50 Chinese regional, or even global, back office facilities and more than 200 service outsourcing companies, contributing 20 billion yuan worth of value-added output.

Offshore business is also expected to account for more than 30 percent of the total business by 2015.

By the end of September, the zone had 67 finance institutions with nationwide or global renown and cumulative investments of more than 22 billion yuan, according to official statistics.

It also expects to have 200 innovative financial institutions in PE or VC by 2015. They are expected to raise funds or own registered capital of at least 100 billion yuan and to pay 30 billion yuan in taxes.

There are already 35 PE or VC firms in the zone, with funds totaling 8 billion yuan.

(China Daily 10/21/2011 page12)