Data provided by the Guangzhou Bureau of Foreign Trade and Economic Cooperation on the exit of some enterprises from Zhujiang Delta shows that these enterprises account for only a small fraction of the total across several industries and that the number of enterprises that have shut down or migrated is in line with the normal of the industrial transfer gradient.

The data suggests that the shut down and migration of foreign enterprises is a normal phenomenon that has always existed in the process of gradient transfer of international capital and industries rather than a sudden occurrence starting from last year. This phenomenon has no negative influence on the core competence of Guangzhou industries since the shut down and migration of enterprises occurs mainly in labor intensive industries. On the other hand, it has created opportunities for the upgrading of the industrial structure.

According to the data there were 53 and 294 foreign invested enterprises that shut down before and on the expiration dates of their contracts respectively in 2007. Those enterprises were mainly small and medium sized labor-intensive enterprises in the textile, garment, shoe-making, plastics, and hardware industries.

The statistics illustrate that there were 193, 148, and 347 foreign enterprises that shut down (before and upon the expiration of their contract dates) in 2005, 2006, and 2007 respectively. There were, respectively, 1061, 1025, 959 new foreign enterprises opened in the meantime. According to statistics, the total number of foreign enterprises has been increasing steadily. In 2007, the additional investment of 675 foreign enterprises accounted for 62.5% of the total foreign investment in Guangzhou demonstrating that, the majority of foreign businessmen are confident of their investments in Guangzhou.

(Translated by Guangzhou Association of Foreign Affairs Translators)

Source : english.gz.gov.cn