Guangxi suffered stunted growth while other provinces raced ahead with the help of central government policies, but the region's potential for growth is now being recognised. Provincial capital Nanning was selected over Kunming in Yunnan province as the venue for the China-Asean Expo early this month. Shou Sihua , head of the Guangxi Academy of Social Science's economics department, said this showed the province could now use its location to its advantage. Guangxi, next to Vietnam, suffered the ravages of the Sino-Vietnamese war and later became a marginalised province with neglected ethnic groups. But Guangxi officials have since learned to ask for concessions from Beijing to help in its role as a conduit for trade between the mainland and members of the Association of Southeast Asian Nations. Guangxi party vice-secretary Guo Shengkun said Nanning was applying for simpler customs procedures and tariff breaks. 'We will definitely try and get more incentives from the central government,' said Vice-Governor Li Jinzao . Mr Li confirmed that Dongxing border town was also seeking support to set up a duty-free zone with Mong Cai on the Vietnamese side. Professor Shou said Guangxi should experience three-way development: towards Guangdong and Hong Kong, towards its traditional southwestern neighbours -Yunnan, Guizhou and Sichuan , and south towards the rest of Asean. 'Guangxi's backwardness is an asset, because this means it has a lot of potential for growth,' he said. The executive director of the Hong Kong Trade Development Council, Fred Lam Tin-fuk, said Guangxi offered Hong Kong investors better profit margins because there was less competition. 'In terms of infrastructure projects, the [Guangxi] government is more willing to give you better terms compared to coastal cities,' he said. US retail chain Wal Mart and Malaysian department store operator Parkson have already discovered Nanning, while mainland-born US businessmen Foster Liao has just signed a US$100 million contract to set up a traditional medicine venture in the city. The China-Asean Expo attracted more than 300,000 to Nanning, including 18,000 foreign buyers and exhibitors. They were greeted by a modern city with decent infrastructure that was ready to do business. Although Guangxi has only 1,000km of highways, Asia Development Bank transportation expert Zhang Wen said the province's main cities of Nanning, Liuzhou and Guilin and Fangcheng port were all linked. 'It does have the basic requirements for investment ... unless investors want to go to the poorest areas to invest,' Mr Zhang said.