Strategic connections
Booming city draws world's top companies to its free-trade zone and international business potential, writes Keith Chan
Xiamen, the fourth-largest city in Fujian province after Quanzhou, Fuzhou - the provincial capital - and Zhangzhou, has embarked on two major tasks this year which will greatly enhance the city's development in the next decade.
On April 21, the Xiamen Area of China (Fujian) Pilot Free Trade Zone (FTZ) officially began operations, forming an integrated part of the free-trade zone, which will be a testing ground for economic reforms to attract more foreign investment and business activities. With its strategic location facing Taiwan on the other side of the strait, the Xiamen area will also take up another task of fostering closer economic and social exchanges between Taiwan and the mainland.
This year, Xiamen will also make preparations in connection with the nation's "21st Century Maritime Silk Road" project which, together with the "New Silk Road Economic Belt", will form the country's "One Belt, One Road" development initiative. First announced by President Xi Jinping in late 2013, the initiative is aimed to vitalise business and investment in cities along the routes and strengthen their connections with cities in Southeast Asia, Central Asia, Africa and Europe, thus increasing the nation's political and economical influence in those areas.
While the details of the "One Belt, One Road" have yet to be announced, Xiamen is already making plans to develop into a major cruise hub along the "Maritime Silk Road", and launch new cruise services to Asean countries and the Middle East. Last year, Xiamen recorded a 9.2 per cent growth in GDP to 327.35 billion yuan (HK$415 billion). Although the figure was lower than Quanzhou (573.34 billion yuan) and Fuzhou (516.92 billion yuan), it is remarkable considering that it only has a population of 3.5 million, less than half of the population of Fuzhou (7.1 million) and Quanzhou (8.1 million).
The disposable income of Xiamen's urban citizens, at 39,625 yuan last year, was also higher than the two larger cities (34,820 yuan for Quanzhou, and 32,451 yuan for Fuzhou).
Xiamen has also outperformed the two cities in foreign investment. Last year, newly approved foreign investment projects in Xiamen totalled 417 in 2014, up from 331 in 2013, with contractual foreign investment increasing 33 per cent to US$ 2.99 billion.
By the end of 2014, 47 of the world's top 500 companies have invested in Xiamen, involving 104 investment projects, with a total investment of US$6.65 billion.