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The amount of foreign direct investment used in central China over the first five months of this year reached US$1.5 billion, up 10.5 percent from the same period last year, according to statistics from the Ministry of Commerce.

The figure is much higher than the national average of 2.78 percent and 1.74 percent higher than the western area.

Lin Zheying, deputy director general of the Ministry's Foreign Investment Administration, attributed the rapid growth to the Rejuvenating Central China Strategy formally put forth by the central government in April.

The strategy targeting six provinces namely Shanxi, Anhui, Jiangxi, Henan, Hubei and Hunan comes after the Opening-up Strategy for the Eastern Coast in the 1980s, the West Development Strategy in 2000 and the Rejuvenating Northeast China Strategy in 2003.

"Without the rise of the central region, the rejuvenation of China will be hopeless. If we (the six provinces) fail to seize the opportunities brought by the new strategy, the central region will continue to lag behind the rest of China in one or two decades," said He Tongxin, vice-governor of Hunan Province at a press conference looking ahead to the First Investment and Trade Exposition for Central China.

Although the six provinces cover a land area that is more than one ninth of China's total territory, its foreign trade volume was three percent of the country's total while its actual use of foreign direct investment only represents seven percent, China's official data revealed.

To remedy the situation, Vice-Minister Liao Xiaoqi said that the ministry had planned to release a package of incentives during the trade and investment exposition scheduled for September 26-28.

He said that the ministry has initiated a series of symposiums in major cities such as Beijing, Changsha, Xi'an, Hefei and Shenyang where representatives from academia and business communities were invited to brainstorm feasible policies to enliven the economy of central China.

These incentives may further raise the region's foreign investment and trade, Lin Zheying predicted.

Sandwiched between the western hinterland and advanced eastern coast, central China can make use of its geographical advantages to develop into the country's logistics centers, experts said. It is also widely viewed as an emerging processing base to eclipse the eastern coast.

He Tongxin said that the strategy is benefiting the local economy as its cross-province economic trade volume from January to May totaled 71 billion yuan with more than 80 percent coming from cooperation with the eastern coast.

The Investment and Trade Exposition for Central China was jointly held by eight ministries with the approval of the State Council. Delegates from Taiwan, Hong Kong, Macao, Japan, Singapore, Germany and European Union are expected to attend the three-day event.

(Xinhua News Agency June 24, 2006)