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Cross-border Pioneer

Celebrations to mark the first anniversary of the Nansha New Area
Celebrations to mark the first anniversary of the Nansha New Area

Launched in April 2015, the Nansha New Area, a key cross-border e-commerce hub in the heart of Guangzhou, has successfully piloted a number of reforms and innovations, designed to promote investment and raise trade efficiency. It has also led the way in ensuring compliance with various international investment and trade requirements.

In a sign of its success, the Ministry of Commerce nominated Nansha's cross-border e-commerce supervision model as one of its eight national Cases of Best Practice. In another telling testimony, 25 out of the 27 cross-border trade initiatives currently active in Guangdong were tested in the Nansha New Area. In many cases, they were also the first initiatives of their kind to be implemented anywhere in the country.

Four of these initiatives – Hong Kong Connect, One-stop Processing, Cross-border E-commerce Product Quality Tracking and Smart Inspect – are considered having a particular impact.

Hong Kong Connect

This business platform has led the way in allowing companies in Nansha to fully access Hong Kong's business services. Established by Chong Hing Bank, the Yuexiu Group and Nansha Investment Consulting, the initiative enables Hong Kong companies and individuals to handle all the procedures related to setting up business in Nansha without having to leave Hong Kong.

One-stop Processing

The adoption of this initiative has greatly simplified the licensing and certification needs of most businesses. With the exception of food businesses and enterprise investment-filing certificates, applicants need only log in twice to secure all the 15 licences and certificates required. The entire process can often be completed within a working day. As a result, the Nansha New Area is said to lead the country in processing speed for multiple business permits.

Online Cross-border Product Quality Tracking

The adoption of this facility means that consumers only need to input their order number, ID number or courier checking number to access information related to their cross-border e-commerce goods purchase. The information available includes the commodity name, quantity, item number, declared place of origin, name of manufacturer and the entry port. As of February, more than 140,000 searches had been made using the service.

Smart Inspect

This innovation has cut the clearance time for imports by about 70 per cent, while there is virtually zero waiting time in the case of exports. Under the terms of this new 24-hour, paperless express clearance system, all inspection fees are borne by the government, provided that nothing is found wrong with the goods in question.

Overall, given these four notable innovations, as well as its general progress, the Nansha New Area has benefited in four key sectors – cross-border e-commerce, shipping logistics, financial innovation and technological innovation.

Cross-border E-commerce

As of the end of February, 774 cross-border e-commerce companies had registered with the Nansha Entry-Exit Inspection and Quarantine Bureau and started operations. Of these, 392 are cross-border e-commerce companies, 299 are e-commerce platforms, 30 are foreign trade comprehensive service companies, 10 are payment companies, 23 are warehousing companies and 20 are logistics/delivery companies.

Cross-border e-commerce operators in Nansha handled online bonded imports worth more than Rmb1.38 billion in 2015, a 45-fold increase over the previous year. Other companies have since started operating in the new area, including Hong Kong's Four Seas Mercantile Holdings Cross-Border E-Commerce Direct Sales Centre and Travelnomall, a business established by Fok Kai Man, Vice-President of the Fok Ying Tung Group.

Travelnomall: a new addition to Nansha
Travelnomall: a new addition to Nansha
Hong Kong e-commerce goods on show
Hong Kong e-commerce goods on show

Shipping Logistics

The Nansha Port had a container throughput of 11.77 million TEUs in 2015, making it among the world’s top 12 ports. One year since the Nansha New Area’s establishment, the port has increased its number of international routes to 74. In addition, 10 dry ports have opened, five shuttle-bus feeder lines have been introduced, and 1,200 new shipping logistics service companies have been established – three times the number in operation prior to the approval of the pilot Free Trade Zone (FTZ).

Additionally, a total of 575 ships, worth Rmb1.958 billion, changed hands at the Guangzhou Shipping Exchange. Nansha also completed its first cross-border settlement of capital via a third-party platform.

Financial Innovation

A total of 969 new financial and quasi-financial institutions have been established over the past year. Collectively, they have handled the filing of cross-border renminbi loans worth more than Rmb5.688 billion, most of which were conducted in association with Hong Kong and Macau financial institutions. Hong Kong's Chong Hing Bank has also set up a branch in the Nansha New Area.

Financial Leasing

A total of 103 new financial leasing companies – collectively with a registered capital of some Rmb45 billion – have moved into the New Area. The value of the new contracts subsequently secured amounted to about Rmb30 billion.

Guangzhou has also made considerable progress in the area of aircraft leasing. Three planes have been delivered as part of an initial cross-border aircraft leasing deal with the Guangdong FTZ.

Science and Technological Innovation

Local spending on science and technological research this year saw a 68 per cent year-on-year increase, with the New Area now home to 25 per cent of all new R&D institutions in Guangzhou. The number of high-tech enterprises in the New Area has also increased dramatically, rising by 35.7 per cent year-on-year. This resulted in the production of high-tech products, worth Rmb136.4 billion, some 47.6 per cent of the region's gross industrial output.

The Hong Kong University of Science and Technology (HKUST), in collaboration with the University of Hong Kong and the Chinese University of Hong Kong, has established the Guangdong-Hong Kong-Macau (International) Youth Entrepreneur Hub. This now operates under the auspices of the HKUST Fok Ying Tung Research Institute.

From a macro point of view, the Nansha New Area registered increases across all of the relevant economic indicators in 2015. Its average economic growth during the 12th Five-Year Plan period, which covers 2011 to 2015, was also the highest in the city. A total of 9,919 new enterprises were established locally, exceeding the number of enterprises that existed before the establishment of the FTZ. Collectively, the registered capital of these new enterprises was about Rmb83.58 billion.

There are now 783 Hong Kong- and Macau-funded enterprises in the New Area, representing a total investment of US$11.57 billion.

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Content provided by Hong Kong Trade Development Council
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