New wave

Updated: 2011-05-06 12:48

By  Zhao Yanrong and Zhang Jianmin (China Daily European Weekly)

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The ocean economy contributed 350 billion yuan to Zhejiang and as much as 13 percent of total provincial GDP last year. But compared with other "blue" economic zones such as Shandong - with its 17 percent of GDP from the ocean economy - Zhejiang still holds much potential in the sector.

Achieving the ambitious plans for the ocean sector and its supporting industries has been the hallmark of numerous government reports, but Guo has been thinking about them for a long time.

Guo and his team already worked on the province's traffic system. Public roads link every village to support the development of the ocean economy.

"A better transportation system can maximize the benefits from the ocean economy, but reforming the local economy should start from port construction," Guo says.

The most famous port project in Zhejiang is the Ningbo-Zhoushan port on the mouth of Hangzhou Bay where the Yangtze, Qiantang and Yongjiang rivers flow out to sea. The joint port is "more than the sum of the two ports" of Ningbo and Zhoushan, says Lu Shanzu, governor of Zhejiang.

The joint port handled 627 million tons of cargo by the end of 2010, which has become the port with world's largest throughput, the China News Service reported.

But the joint project is holding greater expectations for the local economy.

Yan Xiaojun, a professor of marine biotechnology at Ningbo University, has been working and traveling in Europe for years. He compares Ningbo to Rotterdam in the Netherlands as both are coastal cities with very large hinterlands.

"If the joint port management works well, Ningbo could be even better than Rotterdam because we have much deeper ports and more operating berths, with the one and only huge Chinese market," Yan says.

To boost the ocean economy, the joint port was designed as the center for bulk commodities in the local 12th Five-Year Plan (2011-2015). Its cargo handling capacity is expected to increase to 840 million tons by 2013 and reach 920 million tons by 2015.

Trading areas for the petrochemicals, minerals, coal, food, oil, building materials and industrial materials will be specifically set in the joint port. More services such as products delivery, international purchasing and transit trade will also be provided to form an "integrative international port".

The joint port also offers more regional functions such as a petrol and diesel oil distributing center for the Yangtze River Delta and ship oiling center for the Shanghai International Shipping Center.

"The Ningbo-Zhoushan port deserves more preferential policies because of its important functions," says Zhang Shankun, deputy director of the ocean economy development office under Zhejiang's development and reform commission.

Zhang expects the Ningbo-Zhoushan port to enjoy similar preferential policies as Shanghai Port, including tax relief, offshore finance and a much more open insurance market.

There will be about 400 marine-related programs carried out with a total investment of 1 trillion yuan in the next five years in Zhejiang, the deputy director says. The local government is also planning a marine industry foundation and will spend 3 billion yuan in the next three years to complete infrastructure and education programs to support the sector.

"As long as the technology and capital investments are in line with our foreign investment policies, we welcome more international support for our new economy," Zhang says, adding that the provincial government visited a few ocean engineering and cleaning companies in Singapore last year.

Ningbo was already one of the first cities through which foreigners entered China in historical times. With China's economic reform since the late 1970s, the city has become more open to foreigners.

Liu Xingjing, director of city planning office in Ningbo's development and reform commission, is very confident of the city's integration with outside investment. For Liu, who has been working in Ningbo for many years, openness and tolerance are part of Ningbo's culture.

The director believes that Zhejiang's ocean economy should rely more on the bigger Chinese market beyond Europe and North America.

"For foreign investors, the ocean economy offers a great opportunity to enter the Chinese marine market. Ningbo's trading capacity will improve with the economic development in central and western China."

Other industries highlighted by the province's development and reform commission to develop its ocean economy include the ocean equipment manufacturing, clean energy, marine biological medicine, seawater desalination and ocean exploration and development sectors.

Service programs planned for ocean industry also include the marine finance, coastal tourism, shipping and marine-related trading and information technology sectors.

"The ocean economy is a dynamic sector that involves a second as well as third level," says Yan Xiaojun. About 70 percent of the ocean economy in the US is generated by the tourism sectors, Yan says.

"If we have a heavy chemical industry in some of the islands and waters, we also need to consider protecting other industries for sustainable development such as tourism."

A decade seems too short for Zhe-jiang to frame its ocean economy, Yan says.

But the professor sees Zhejiang's ocean economy maturing in 20 years, when its ports are well developed, with a systematic logistics chain toward the inland areas. The large backland market will support Zhejiang's economy and more port-connected companies will move inland area with lower cost.

"But Zhejiang's ocean economy will move toward further out sea and focus more on the offshore business," he says.

Liu Xingjing says the joint port also enhances cooperation between the two cities and "maximizes the exchange of local resources", such as more well-educated professionals from Ningbo getting more job opportunities in Zhoushan for the development of its islands.

Still, training in the marine sciences has just begun in China.

"It is a quite an obvious disadvantage, that we lack marine sector professionals," says Zhang Shankun.

To help address the problem, the Zhejiang government will increase support for ocean-related universities and institutions in Zhejiang.

"The development of the ocean economy in Zhejiang is related to the port construction and logistics industries, which make economic reform more complicated than the basic marine sciences," Yan Xiaojun says.

Ningbo University is one of the first universities conducting research on ocean studies in Zhejiang and has received many marine-related national academic awards. The university also strengthens its academic ties with European countries such as Spain and Norway.

"International cooperation is still set in basic marine sciences studies because of the intense competition for intellectual property rights in the sector," Yan says.

"We still have a long way to go before we are fully capable of supporting the economic reform."

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