TEDA BECOMES ONE OF CHINA’S FIRST ECO-INDUSTRIAL PARKS
Thanks to the efforts in the past over four years, TEDA, on March 8, passed the acceptance test of three ministries and commissions of the central government and then became one of China’s first group of eco-industrial parks. Between March 7 and 8, the expert team and acceptance team of the leading office of the development of the national eco-industrial model zones, which is composed of the State Environmental Protection Administration, the Ministry of Commerce, and the Ministry of Science and Technology of China, conducted in TEDA a two-day acceptance test including the examination, site inspection, and Q&As. Based on the Q&As and discussions of specialists, the teams pointed out in the Acceptance Result, that TEDA was developing into an eco-industrial park “propelled by the government, centered on enterprises, and supported by all people.” The basic conditions and indicators of TEDA meet the requirement as stipulated in China’s Standards for Comprehensive Eco-Industrial Parks.

It is learned that in 2004 the State Environmental Protection Administration of China officially approved TEDA to establish a state-level eco-industrial model zone. In September 2005, TEDA was approved to be one of China’s first group of pilot zones for circular economy by such six ministries and commissions of China including the National Development and Reform Commission, State Environmental Protection Administration, Ministry of Commerce, and Ministry of Science and Technology. After working hard for a few years, TEDA has developed an approach featured by the most efficient way of utilizing resources, reducing pollution, and increasing profits in the process of developing into an eco-industrial park. The next goal of TEDA is to “forge a new mode of green development.”

Apart from TEDA, Suzhou Industrial Park and Suzhou National New & Hi-Tech Industrial Development Zone have also passed the acceptance test. After the 15 day national public announcement, upon the result of the announcement, TEDA, Suzhou Industrial Park, and Suzhou National New & Hi-Tech Industrial Development Zone will become China’s first group of eco-industrial model zones. (Tr. by Dong Jing)

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Over the last 3 years, Tianjin has seen a lot of change. While historically a very industrial city (core advantage being the port), Tianjin has really been able to leverage the FDI brought through TEDA to develop the city.

Like Suzhou, we are seeing that Tianjin’s mix of investment is changing and that as TEDA looks to move up the value chain, there are other areas in the New Binhai area that are willing to take on the overflow investment.

and as the first two pieces indicate, their strategy is working. To learn more about Tianjin, see their profile here and take a few minutes to learn about the new direction of the Binhai area as well

TEDA SEES US$ 6.164 BILLION FDI IN 2007
In December, TEDA has newly approved the establishment of five foreign funded enterprises and the investment increase of 12 companies. The total investment and contracted overseas investment respectively reached US$ 539 million and 202 million.
For the year 2007, accumulatively TEDA has witnessed the establishment of 186 foreign funded enterprises and the investment increase of 255 enterprises. Accumulatively the total investment amounted to US$ 6.164 billion, contracted overseas investment US$ 3.9 billion, and capital in place US$ 1.930 billion. The contracted overseas investment and capital in place are respectively 20.00% and 20.62% up from the previous year. With a total contracted investment of US$ 95.021 million, eight new enterprises are funded by the Fortune 500 companies. Besides, due to TEDA’s super investment environment, some key enterprises have accelerated their pace of development by increasing their capital. In 2007, 26 of the top 500 companies including Foxconn, Kumho Tires, Samsung Electro-Mechanics, and PPG Coatings, have expanded their production and the investment has accumulatively increased by US$ 183 million. (Tr. by Dong Jing)

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Over the last 3 years, Tianjin has seen a lot of change. While historically a very industrial city (core advantage being the port), Tianjin has really been able to leverage the FDI brought through TEDA to develop the city.

Like Suzhou, we are seeing that Tianjin’s mix of investment is changing and that as TEDA looks to move up the value chain, there are other areas in the New Binhai area that are willing to take on the overflow investment.

and as the first two pieces indicate, their strategy is working.  To learn more about Tianjin, see their profile here and take a few minutes to learn about the new direction of the Binhai area as well

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While on a trip to Sinapore in 2001 with 30 Thunderbird students, we were given a behindthe scenes tour of the singapore port and its plans to develop.  the goal was simple.. surpase HK once and for all.

Well, apparently it didn’t work out as planned, and as reported in the China and Shanghai Daily papers, Shanghai has now passed HK to become the world’s second largest port with an amazing 26+ million TEUs.

If there were any doubt about how important the Yangtze delta has become, this should bring about a bit of reality.  26 million TEUS is nearly the throughput of the entire country of Vietnam, and that is factoring in the bulk freight that is also moving through the port.

and if that weren’t enough, Tianjin just logged a 20% increase on last year with 7 million TEUs … and is looking to ramp that us significantly over the next few years.

Now wonder a PE fund specifically for improving the shipping industry is being set up in Tianjin…. Shipping expansion floated

So, congratulations to the folsk at Shanghai Port, and JIAYOU to the folks at Tianjin port.

Growing up, I always hear Home is where you hang your hat, but today the China Daily has put together an article on expats in the 2nd tier cities called Home’s where heart is

Written by Viva Goldner, is a very interesting read and I find that many of the quotes she has pooled together represent similar things we are hearing here from the managers we have been interviewing over the last few months (perhaps that is why she quoted me).

In a report aimed at foreign investors, Brubaker examined real estate investment in the three “showcase cities” of Shanghai, Beijing and Guangzhou, which fed an overheated property market with potential returns of more than 200 percent in just a few years.

“As the cities most accessible to foreign businessmen, they offered a degree of familiarity unique in China, and as such, distracted investors from looking to other markets as investment destinations. Unlike second tier provincial capitals, these cities were considered to be safe bets in a country littered with buyer beware stories,” Brubaker says.

“Historically less developed than Shanghai, Beijing and Guangzhou, second-tier cities sought to catch up by rushing to build the infrastructure necessary to attract large sums of investment.

“So, while the primary markets commanded the attention of many foreign investors, new airports, central business district, arterial highways and universities were being planned and constructed in the provincial capitals. The result has been nothing less than the complete transformation of these cities (and) real estate investment has followed.”

More and more, I expect that the cities of Chengdu, Kunming, Dalian, etc will see movement of senior managers (western and chinese) into their cities. for some it is looking for a little more culture than Shanghai can provide, for others it is the opportunity that the city prvides (much like Beijing or Shanghai 10 years ago), while for others it is being told to go there by someone whose pay grade is a nothc higher.

Perhaps it is because I have a project in Tianjin, or perhaps it is because they saw the news from Chengdu, I have just received the newsletter below from the good folks over at the Tianjin Economic Development Zone (TEDA).   I tried to put links to further sources, but only one source shows in the English press.

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Following the piece on Prologis last week, it was a bit fortuitous that we would see an article in today’s Shanghai daily announcing Ascendas’s plan to raise nearly a billion USD.

For those that are not familiar with Ascendas, it is a Singaporean REIT with close ties to the Singaporean Government. Where Prologis was an early mover in the warehousing/ 3pl facility secotr, Ascendas (through their ties to the Suzhou Investment Park) went for the build to suit facility sector.. and it has paid dividends.

Much like Prologis, the Ascendas developments are world class (I will make trip next week to visit one of the Suzhou facilities), and though they initially had high hurdle rate expectations and were hated by all the big real estate firms Ascendas has done well expanding into other projects in Dalian, Hangzhou, Nanjing, Shenzhen, Suzhou, Tianjin, and Xi’an

And given their interest in raising a billion USD, the list is sure to include other cities (Chengdu, Chongqing, and Wuhan are my first guesses…Wuxi perhaps if the city can guarantee the water supply…. Guangzhou if there is a guaranteed power supply).

For Manufacturers who were once looking for a reliable infrastructure to build on, Prologis and Ascendas are definately making the job of finding space much easier. The only question is can you afford the rent.