SEPTEMBER 2 Basking in the success of the private clothing company he helped build, Zhang Jiangbo has set his sights on the ultimate symbol of state approval - membership of the Communist Party. Party chief Jiang Zemin opened the door for qualified entrepreneurs to join the party in a speech last July, and Mr Zhang, president of Peacebird Group, plans to be among the first to heed the call this year. Peacebird executives like to describe the clothing company as a 'wild child'. But the private firm, once a rarity in China, is starting to look downright respectable 13 years after its founding in the booming coastal city of Ningbo. The rise of Peacebird shows the vibrancy of private firms in Ningbo, where two-thirds of the economy is no longer in state hands. The city has 50,500 registered private companies and 210,000 individual entrepreneurs. According to company lore, Mr Zhang's older brother, Jiangping, borrowed 2,000 yuan (HK$1,890) from his father to sell clothes in nearby Shanghai before the brothers launched their own brand. Now Peacebird is among China's top 50 clothing companies, with 350 million yuan in assets and 1,500 employees. While small private firms beg for funds, banks queue up to lend to Peacebird. Last year, Ningbo named company chairman Zhang Jiangping a 'model worker', once a privilege reserved for state employees. Peacebird has also set up a party committee with 30 members. While that may seem unusual for a company that operates outside the realm of the state, executives said party ties could grease the wheels for business and offer political cover. 'We can go directly to the government. Well-known companies have a greater advantage in getting service from the government and fund-raising. It's unfair but unfairness exists,' Peacebird vice-president Che Xiaofang said. China amended its constitution in 1999 to make the non-state sector an important component of the economy, instead of merely a complement to it. But private firms still struggle to borrow from banks, list on the stock market, export goods and gain government approvals. Even Peacebird has yet to list on the domestic stock market, which is largely reserved for state firms. An offer is planned for 2005. In Ningbo, private companies have thrived on a weak base of state industry, looser government control and the entrepreneurial spirit of the city - a historical port. 'The concept of engaging in business is strong so the private economy is strong. The regulatory environment is more relaxed,' said Ma Rong, head of the enterprise department of the Ningbo Industrial and Commercial Bureau. China was loath to build up state industry in Ningbo because of its link to the nearby birthplace of Chiang Kai-shek, the Kuomintang leader who fled to Taiwan in 1949 after the communist victory. Ningbo wants more private companies to employ tens of thousands of laid-off workers, fill tax coffers and maintain the double-digit economic growth of past years, officials say. Private companies already employ 36 per cent of the city's workforce and pay one-third of the tax. Ningbo's entrepreneurs hope the congress scheduled for November will give the ideological stamp of approval to their way of business, though they expect specific policies to take more time to emerge. 'After the 16th Party Congress there will be a clear solution. Private companies will be a pillar for the economy and future development,' Mr Che said. Local officials say the central government could loosen controls over bank lending to private firms and allow them greater access to sensitive sectors of the economy. Ningbo's most famous private company, carmaker Geely Group, has big expectations. Geely started out making refrigerator parts before producing the country's cheapest car. Founder Li Shufu grabbed headlines last year after criticising the central government for stopping it making a sedan car. Planning officials later relented. 'The environment for private companies is getting better and better,' said Geely's chief executive officer, Xu Gang. Mr Xu, a former tax official and party member who joined the company in April, sees no contradiction between making profits and serving the party. 'Party members should raise the living standards of the people, protect social stability and unity and create wealth for society. There is no conflict,' Mr Xu said.