The Shenzhen Government has outlined plans to cut the rising cost of doing business in the city, targeting soaring property prices and salaries. The city has become one of the most expensive places in the mainland in which to do business, hampering efforts to lure new businesses and retain existing operations. Shenzhen property prices are the highest in China, according to a recent survey. The average price for a Shenzhen property is 5,275 yuan (HK$4,960) per square metre, 642 yuan and 1,275 yuan higher than those of Beijing and Shanghai respectively. 'I have no idea how things turned out to be like this,' Mayor Yu Youjun said at a general municipal meeting on Monday. 'But we must control and monitor the property prices in Shenzhen.' He said the city also would have to cap salaries, which had passed Beijing and Shanghai, according to official statistics. Shenzhen would cut the cost of electricity by 25 per cent by the middle of this year, and lower it further to the level of Zhejiang province next year, Mr Yu said. The dynamic growth of the Yangtze River Delta region and Zhejiang have posed fresh challenges to Shenzhen, as its export-oriented economy has been more adversely affected by the global economic downturn. 'It is very common for an investment group from overseas to Shenzhen being lured away to visit Shanghai the next day,' said Zhong Jian, a senior researcher at Shenzhen University's centre for China special zone research. 'The Government is under a lot of pressure. Already many enterprises have moved to Dongguan for lower costs.' Mr Yu also pressed for lower and more regulated fees on highways and bridges, which have become a focus of complaints. Mr Yu suggested annual fees could replace the tolls, and recommended removing or reducing most toll stations in and around the city. But the Government realises that to compete, it has to attract high-technology industries and professionals who prefer a more international and regulated environment to lower costs and standards. 'Shenzhen will strive to become a city with the most regulated, transparent and reasonable fees,' said Mr Yu, avoiding references to the 'lowest' costs. Mr Yu urged various levels of the Government to revamp fees and charges on businesses and residents. All fees have to be submitted for approval before April 15 and will made public in May. To lure talent from Hong Kong, Taiwan and overseas, Mr Yu promised Shenzhen would set up at least one international school in each district. He also promised to build international-standard private and joint-venture hospitals. To cater for overseas residents and create a more international atmosphere, the city also planned to build up to five bar streets and several golf courses for the public, the meeting heard.
