SHUANGLIU: The mention of China Chuankai Electric Corporation in this suburban county of Chengdu, capital of Sichuan Province, would testify that it is a thriving firm and one of China's top 15 switch producers.

With its assets of nearly 600 million yuan (US$72 million), employees about 1,260 and annual output value at 610 million yuan (US$73 million), the corporation has products that have sold well in Southeast Asia and Africa.

In 25 years since its founding, the corporation owes its rags-to-riches expansion story to the hard work of its decision-makers and its employees as well as the backing of government departments in Shuangliu, China Chuankai Electric Corporation Chairman Jian Xingfu said in an interview.

Endorsing the idea that "science and technology are the No 1 productive force," departments concerned with those areas in Shuangliu have set up an advisory body consisting of experts and scholars from different fields to supply up-to-date information pertaining to science and technology and help enterprises solve technology-related problems.

They have set up funds to encourage enterprises to renovate and advance their technology and build platforms for enterprises to co-operate with institutions of higher learning and scientific research institutes.

The county makes awards of 200,000 yuan (US$24,155) to entrepreneurs and researchers who have created new crafts, new equipment and new products that have brought in revenue. It spends 5 million yuan (US$603,865) a year to subsidize enterprises to co-operate with the Chinese Academy of Sciences to create new fruits of scientific research. It can subsidize a single research project for up to 300,000 yuan (US$36,000).

Shuangliu has set up a development fund for small and medium-sized enterprises. Each year, it spends 20 million to 30 million yuan (US$2.4 million to US$3.6 million) to pay the interest on the loan that enterprises use to renovate their technology.

"Last year, our corporation invested more than 20 million yuan (US$2.4 million) to renovate technology," said Jian, China Chuankai Electric's president, "and the Shuangliu county government paid interest totalling 900,000 yuan (US$108,696) for the loan. Although it was not a considerable sum, it alleviated our corporation's fund shortage."

"Thanks to help from relevant government departments in charge of science and technology, our corporation has co-operated with Sichuan University and the Institute of Optics and Electronics of the Chinese Academy of Sciences to accelerate our development of new products and achieve remarkable economic returns," Jian added.

Each year, the Shuangliu government allocates 4.5 million yuan (US$543,478) to subsidize enterprises that develop new products to acquire intellectual property rights, introduce modern processing equipment and set up processing centres. The county allocates millions of yuan to subsidize enterprises to complete product attestation and create brand-name products and trademarks.

"While creating our brand-name product, KYN28A-12 metal clad withdrawable switch gear, our corporation was strongly backed by the county's quality supervision department, which offered guidance of Sichuan's brand-name products to us periodically," Jian said.

"In the sixth attestation of Sichuan's brand-name products, the switch gear passed the appraisal, improving our corporation's fame and market competitiveness."

The Shuangliu county government also formulated policies to reward enterprises that pay higher taxes, he said.

For industrial enterprises that paid taxes surpassing 1 million yuan (US$120,773) in the previous year, the county refunds a certain proportion this year.

For enterprises that pay taxes of more than 5 million yuan (US$603,865), the county government also gives each a major taxpayer award and confer on its legal representative a medal and a bonus.

The cost of a mu (one-fifteenth of a hectare) of land in Shuangliu is between 100,000 and 140,000 yuan (US$12,077 and US$16,908). For excellent industrial projects, Shuangliu can transfer the land below the cost price. For extremely excellent industrial projects, the county can offer a zero land price.

The county offers even more preferential policies for Fortune 500 companies and projects with high scientific and technological content, with a huge sum of investment and anticipated good economic returns. The policies will be set by an executive meeting of the county government.

Eleven Fortune 500 companies have invested in Shuangliu.

In 1996, Bayer of Germany invested in the county to build the Bayer (Sichuan) Animal Health Co Ltd. With a total investment of US$10.8 million and covering 3.1 hectares, construction of the company was completed in 2000. It has introduced 53 varieties of animal health and public health products.

Otis of the United States and China Chuankai Electric Corporation have set up the Sichuan Express Elevator Company Ltd with an investment of US$5.2 million. It expects to make 2,000 elevators a year with annual sales surpassing 150 million yuan (US$18 million) and annual profits and taxes 40 million yuan (US$4.8 million).

Siemens of Germany has co-operated with China Chuankai to produce 3AH serial circuit breakers. Anticipated annual production capacity is 3,000 breakers, increased sales over 60 million yuan (US$7.2 million) and profits and taxes 10 million yuan (US$1.2 million).

ABB of Britain has co-operated with China Chuankai in producing a new type of medium voltage switch gear. Anticipated annual production capacity is 1,000 units, annual sales more than 200 million yuan (US$24 million) and profits and taxes 50 million yuan (US$6 million).

Nestle Haoji Group will invest 1 billion yuan (US$121 million) to build the Haoji Food Industrial Park in the Sichuan Foreign Trade and Export Production Base in Jiujiang Town. Anticipated annual output value is 3 billion yuan (US$360 million), with annual profits and taxes more than 200 million yuan (US$24 million).

Tyco of the United States and the Zigong High Voltage Valve Plant in Sichuan set up KTM Ball Valve Manufacturing (Sichuan) Co Ltd in Shuangliu in 1994. The joint venture's products are sold well in the United States, Japan and more than 20 countries in Southeast Asia and the Middle East. Annual sales register US$10 million.

Hansa (Asia) Holdings Limited and Sichuan Airlines have set up a joint venture, Sichuan Airlines Hansa Food Co Ltd, to provide food for flights on both Chinese and overseas airlines.

(China Daily 05/16/2005 page9)