Center

Chengdu to focus on outsourcing industry

By Huang Zhiling (China Daily)
Updated: 2007-04-03 08:54

CHENGDU: This capital city ofSichuanProvince will promote the outsourcing industry with the aim of making itself the leader in the field in central and western China.

To achieve the ambitious goal, it will tap the European, American, Japanese and South Korean markets and work hard to achieve $100-200 million in outsourced business this year and $500 million in 2010, Tang Hua, deputy director of the Chengdu bureau of commerce, told China Daily.

"Development of the outsourcing industry is an important way to improve the quality of Chengdu's foreign trade," she said.

Manufacturing is Chengdu's strength, especially integrated circuits, micro-electronics and precision machines.

"But the inland city is thousands of kilometers away from the sea and entails for its industries at least 50 percent more transportation than in coastal regions. Products manufactured in Chengdu reach other countries at least five days later than the ones from coastal regions," said Chen Xiaobing, chief of the general office of the Chengdu bureau of commerce.

But Chengdu enjoys advantages in exports of outsourced services in the software sector because of its talented personnel and government support. Also, this segment doesn't have a high transportation requirement, Tang said.

An important educational and scientific research center in the country, Chengdu has 33 institutions of higher learning and 70 scientific research institutes feeding its talent pool. Its scientists and technicians number 630,000, ranking it first in western China. Nearly 60,000 people are engaged in the software sector.

Since 2000, Chengdu's software sector has witnessed a growth rate of more than 30 percent. Last year, sales amounted to $1.7 billion and outsourced service exports surpassed $30 million. The city has more than 3,000 registered software enterprises.

"Many multinationals pin high hopes on the development potential of Chengdu's software sector and consider the city their top priority when investing in China," said He Huazhang, vice-mayor of Chengdu.

"Motorola, Intel, Microsoft, Ericsson, Alcatel, Nokia and Sony have set up R&D centers in Chengdu," he said.

The government is to develop 10 outsourcing base cities by 2010. Assistant Minister of Commerce Fu Ziying said that under this plan, 100 multinationals would be encouraged to shift offshore outsourcing services to China and 1,000 large and medium-sized service outsourcing enterprises would be nurtured.

(China Daily 04/03/2007 page14)