By: Richard King
USA & CHINA
Different Perspectives on Economic Development
The field of economic development has become a multi-million dollar industry in the United States. The activity just in Southern California is an example of the increased emphasis on economic development. Organizations such as the Los Angeles Economic Development Corporation (LAEDC), the Valley Economic Development Council, the City of Burbank Development Office, the Burbank Chamber, Pasadena Chamber, Los Angeles Chamber and the Small Business Administration Regional Office are actively involved in economic development. The priority of these agencies is to attract businesses to the region and retain businesses that are already here. They employ a staff of experts in this field, with significant operating budgets, coming primarily from the private and government sector, i.e. private/public partnerships.
I thought it would be interesting to compare how economic development is handled in China which is somewhat different from the United States.
Firstly, economic development activity in China is totally a government function. All levels of government participate including the central government, provisional government, cities, townships, etc. There is fierce competition among cities and provinces to attract foreign investment, encourage companies to locate, and to provide attractive incentives. I have personally worked with many provinces and cities in China on their economic development endeavors. These include Anhui province, Xinjiang province, Jilin province, Shandong province, Liaoning province, Zhejiang province and others. These cities and provinces employ huge staffs with attractive offices and significant budgets. They tend to emphasize the uniqueness of their area. As an example; Xinjiang emphasizes their western location and their natural resources; Anhui emphasizes their central location, the biotech and automotive industry and the presence of many fortune 500 companies already in their province. The top officials of these cities and provinces are directly involved in economic development, from the governors, mayors on down.
To better understand how economic development entities function in China, let me use two examples, the Beijing Investment Service Center, and the China Council for the Promotion of International Trade. Here is the scope of some of the services provided by the Beijing Investment Service Organization.
• Providing advisory services including drafting of proposals, feasibility studies, and formalities of application and approvals.
• Assisting and setting up representative offices in China.
• Organizing economic and technical exchanges, conferences, seminars and exhibitions.
• Organizing training courses for administrators and professional personnel of foreign enterprises.
• Developing promotion materials, such as brochures, etc.
Next is the scope of services provided by the China Council for the Promotion of International Trade (CCPIT)
• Handle liaison work with foreign Chambers of Commerce and industries around the world.
• Strengthen ties with the overseas commercial sections of Chinese embassies.
• Plan, organize and invite foreign business delegations and set up meetings with appropriate personnel.
• Host and stage international exhibitions in China.
• Collect economic information and identify joint venture opportunities.
• Provide material on foreign politics, economics, culture and other background information.
• Provide assistance in preparing feasibility studies and project proposals. Also assist in facilitating the decision making process.
In view of the services provided, it is important for companies in Southern California to establish contact with US and Chinese economic development agencies and take advantage of the services they offer for entering the China market.
Chairman Emeritus of Woodbury University
Director, Pacific Rim Programs at Woodbury University,
Chairman/Founder King International Group