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Wenzhou, a business hotspot

Updated : 2016-08-19

The city, boasting thousands of years of trading experience, is one of China's growth engines

Wenzhou, a major city in Zhejiang province, has won national fame in recent years for its booming private investment and asset expansion as well as its fast economic growth.

With a history dating back to the Kingdom of Dong'ou more than 2,200 years ago, Wenzhou, previously known as Bailu, or White Deer, began its rise to economic prominence in the early 1980s. Before then, the city, located in the southeastern coastal region, was little more than a market town with a flourishing agriculture and cottage industry.

Mount Yandang

Nanxi River

About five thousand years ago, a troop of the ancient Yue people moved from the north and settled on the sloping fields, with hills behind and the sea in front, at the middle and lower reaches between the Oujiang and Feiyun rivers. Their life consisted of fishing, hunting and primitive farming through successive generations.Those Yue people were the original founders of Wenzhou, which was the capital of the Kingdom of Dong'ou in 192 BC, later becoming Yongjia Prefecture in AD 323.

Legend has it that a white deer holding a flower in its mouth passed as the city was being built. In AD 675, the settlement beganto be called Wenzhou. Historically, it was a city renowned for its handicrafts and also as one of the birthplaces of the Celadon variety of ceramics. Wenzhou's skill in papermaking, silks, embroidery, lacquer work, and shoes and leather products was renowned throughout the country.

The city, which at that time covered 11,784 square meters, with a population of 9.1 million, was largely rural before the reforms and opening-up in 1978 when only 10 percent of the population held urban household registration cards, known as hukou. When China beganits economic reformsin 1978, Wenzhou was the first city in the country to establish individual and private enterprises in addition to a shareholding cooperative economy. In the early days of the reforms, the people of Wenzhou took the lead in developing a commodity-based economy, household industries and specialized markets. Many thousands of people were engaged in household manufacturing to develop this individual and private economy.

At the beginning of the twentieth century, this coastal city became home to a number of foreign businessmen. The introduction of the many foreign commodities that accompanied this cultural influx stimulated the development of the city's commodity economy and also made an impact on the people who dwelt there.

Jiangxinyu Island


According to updated official figures, the city's GDP in 2010 was more than 292 billion yuan ($45 billion), 11 percent higher than the previous year. The total value of fixed assets also increased by 11 percent to reach 93 billion yuan.

The more enterprising residents picked up the notion of industrialization from those foreign business people and quickly transformed their own cottage industries into large-scale production powerhouses. At the last count, Wenzhou had a total of 240,000 privately-owned commercial and industrial units, including 130,000 enterprises of which 180 can be ranked as conglomerates.

Among those enterprises, four have made it onto the list of China's top 500 businesses. What's more, 36 of Wenzhou's enterprises took leading positions among the top 500 Chinese enterprises in the private sector. The city is sometimes called "China's capital of capitalism" as 99 percent of all businesses in the city are privately owned.

China's 12th Five-Year Plan (2011-2015) aims to transform its labor-intensive manufacturing economy into one based on technology and innovation. In December, Wenzhou's city government released a document detailing the upgrading of the local economic structure, together with effort to improve people's liveliness, balance rural and urban development and strengthen public services and governance reform.

With improved infrastructure logistics, Wenzhou also aims to become the distribution center for global trade on the Chinese mainland. The city boasts a luxury, high-end consumer market. With combined private capital of 750 billion yuan, its businessmen are expected to have a wide range of investment options in addition to their core businesses.

"Our goal is to improve the quality of people's lives, boost industrial restructuring, and advance the economic development of the city," said Chen Derong, Party secretary of Wenzhou and vice-governor of Zhejiang province.

Chen added that Wenzhou will focus on investments to improve the city's economic restructuring as a key goal of the 12th Five-Year Plan.

The municipal government has set a target for annual investment of more than 50 percent for the next five years and it will reach 1 trillion yuan in 2015.

"In order to reach the target, we have to push the development of the economy, society and government by maintaining our current healthy economic growth," said Chen.

Since last year, the authorities in Wenzhou have released a series of policies to improve benefits for residents and spark urban development.

In addition, as a hotbed of financial investments, the city is keen to improve its investment environment by offering opportunities for better returns for local businessmen and investors.

In accordance with the policy, private enterprises in Wenzhou and the port of Taizhou are being encouraged to participate in the development of oceanic trade by setting up trial projects on ports logistics, the petrochemical industry, and exploitation of raw materials on the neighboring islands.

"As a coastal city, we have to use that advantage to make a greater contribution to the ocean-trade development by carrying out more innovative industrial projects," said Chen.

Signs of wealth abound in this city of more than 9 million population. The newly constructed boulevards and old narrow roads in the inner-city district are teaming with expensive cars. New shopping malls and luxury apartment blocks stand out among old tenement blocks that are awaiting the wrecking ball.



At present, more than 600,000 Wenzhou businessmen own companies in 131 countries and regions across the world, and 175,000 businesses have formed 193 business councils in China's prefecture-level regions with the aid of the Wenzhou Chamber of Commerce.

In 2009, the city instigated a project to welcome the participation of foreign-based Wenzhou merchants in investment and commercial projects. The aim of the project, together with a series of policies the city has launched, is to attract its more successful foreign-based business leaders to set up headquarters and research and innovation centers in the city within the next five years.

"As a long-term goal, we want to spread the Wenzhou spirit and hometown togetherness among Wenzhou-born businessmen globally to accelerate the economic restructuring of the city," said Zhao Yide, Wenzhou mayor.