Suzhou Industrial Park (SIP) 9th Joint Steering Council Endorses New Thrusts to Promote the Continued Growth of SIP

(SIP) 9TH JOINT STEERING COUNCIL ENDORSES NEW THRUSTS TO PROMOTE THE CONTINUED GROWTH OF SIP

Singapore and China agreed to embark on new areas of cooperation in Suzhou Industrial Park (SIP) today, ranging from areas such as business process outsourcing, logistics to facilitating the “Go Global” efforts of Suzhou companies.

These initiatives were discussed during the Suzhou Industrial Park (SIP) 9th Joint Steering Council (JSC) Meeting, held in Singapore on 10 July 2007. Co-chaired by Singapore Deputy Prime Minister Wong Kan Seng and PRC Vice-Premier Wu Yi, this high-level political platform oversees bilateral cooperation in SIP, a flagship project that was started in 1994.

Both sides noted the strong progress that SIP has made since the last JSC meeting held in Beijing in August 2006. SIP’s GDP grew by 18.8% to reach RMB 68 billion and attracted US$ 1.6 billion in utilized FDI last year. On software transfer, Singapore has trained over 2,000 officials from Suzhou to date, covering areas that are in line with China’s developmental needs such as environmental management, urban planning and logistics.

With SIP’s exceptional economic growth averaging 23% over the past three years, both sides noted that the industrial park has already surpassed the 10-year performance targets[1] set during the 7th JSC meeting in 2004.

Going forward, both sides agreed to set new 10-year targets during this 9th JSC meeting to steer SIP towards a hi-tech and high value-added economy. It was envisaged that by 2014, SIP’s service sector’s value-add to the local economy would reach 40%, R&D spending would constitute 5% of the local GDP and 75% of total industrial value would be created by hi-tech industries.

During the meeting, the JSC also endorsed new directions aimed at promoting the continued strong growth of SIP and enhancing the overall competitiveness of the industrial park.

The JSC endorsed Business Process Outsourcing (BPO) special tax incentives for SIP and flexible working hours for BPO companies with special production needs operating in the park. These policies will give SIP an edge in attracting more BPO players, and moving the park towards becoming a leading BPO hub in China.

The JSC also discussed ways for SIP to promote the development of air-land intermodal transportation operations in Suzhou. The meeting endorsed a proposal to allow airlines to issue Air Waybills originating from SIP’s virtual “SZV” airport code. This move is expected to encourage more airlines (including foreign ones) to set up offices in Suzhou.

The JSC explored expanding the scope of cooperation in the SIP project as well. This includes forging closer partnerships in promising sectors such as BPO, logistics as well as water and environmental services. At the same time, both sides also discussed the role Singapore can play as an internationalization base for Suzhou companies which are ready to go global.

In addition, both sides agreed to work together to broaden cooperation in adapting Singapore’s developmental experience to other parts of Jiangsu Province as well as Western and Central parts of China.

The well-established JSC framework underscores the strong emphasis that both governments place on this flagship project as well as the close cooperation between Singapore and China. Both sides agreed this had been a very fruitful meeting and look forward to convening the next JSC meeting.

MINISTRY OF TRADE AND INDUSTRY
10 JULY 2007

[1] These include indicators such as local GDP, fiscal revenue, trade volume and total utilized FDI.