Private funds funnel into Beijing

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Last updated at: (Beijing Time) Saturday, October 11, 2003

Private funds funnel into Beijing

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Strong local economic growth and municipal government work have combined to make Beijing an investment magnet for private domestic funds, which make up for more than half of the 131.4 billion yuan (US$15.9 billion) invested in the capital during the first ninth months of the year.

Making the observation on Friday, Yu Xiuqin, spokeswoman for the Beijing Municipal Statistics Bureau, called it a notable sign of improvement in the city's investment structure.

"Local investment no longer hangs heavily on the financial injections of central and local governments,'' she said.

"The greater involvement of private domestic funds can help fuel the local economy further on a more vigorous and healthy track.''

Zhu Biao, a 46-year-old from Chengdu, in Southwest China's Sichuan Province, opened a new restaurant in eastern Beijing's Jiuxianqiao neighbourhood, which serves spicy traditional Sichuan food to about 50 people at a time, on October 1.

If it was not for severe acute respiratory syndrome, or SARS, his restaurant would have opened during the May Day holiday.

"I was told that over 90 per cent of small restaurants in Beijing had gone into the red due to SARS by late July, over half of which had to be sold,'' Zhu said.

Although his first business in Beijing opened exactly five months later than planned, Zhu was still feeling lucky.

As a seasoned businessman, he held back his investment until the restaurant industry in the capital had regained its legs.

"We're lucky that the Beijing economy has recovered so soon,'' Zhu said.

Statistics from the bureau show the Chinese capital managed a gross domestic product of 246.2 billion yuan (US$29.7 billion) in the first three quarters of 2003, up a year-on-year 10 per cent.

"The negative impact of SARS on the local economy has been shaken off,'' Yu said. "We are optimistic about fulfilling this year's economic growth target of 10 per cent.''

At the same time, people in downtown Beijing have enjoyed a year-on-year increase of 12 per cent in their per capital disposable income in the first nine months of the year, while there has been a 4.5 per cent increase in their per capita consumption. The two figures are 10,388.2 yuan (US$1,254.6) and 8,070.1 yuan (US$974.6) respectively.

But the strong consumption capacity of Beijingers is not the only reason bringing a smile to Zhu's face. He has also hailed Beijing for its simplified administrative examination and approval procedures, which have been reduced dramatically over the past several years.

Beijing's economic development programme for the 10th Five-Year Period (2001-05) holds that 30 per cent of the city's fiscal revenue should come from private business by 2005, which employs over 30 per cent of the city's downtown staff.

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