The investment environment in Hubei Province

1.  Location

Hubei Province lies in the middle reach of the Yangtze River with an area of 186,000 square kilometers. Situated 108’21”-116’07” east longitude and 29’05”-33’20” north latitude, it got its name from being in the north of the Dongting Lake. The terrain of Hubei Province is high in the west and low in the east and wide open to the south, the Jianghan Plain.

The province is surrounded on three sides (east, west and north) by mountains. Its low and flat middle part is a piece of incomplete basin slightly open towards south. Of the gross area, there are 56% mountains, 24% hills and 20% lowland lake area.

As to mountains, they are divided into four parts in the province. Northwestern mountains are area extending to the east by Qinling and east section of Daba Mountain. Area extending to the east by Qinling is called Wudang mountain chain, going from northwest to southeast, with lots of mountains. Altitude of ridge of mountains is generally above 1000m, and the highest is Tianzhu Peak of Wudang Mountain with altitude of 1621m. East section of Daba Mountain consists of Shennongjia, Jingshan Mountain and Wushan Mountain, with thick forests and deep river valleys. Peak of Shennongjia is Shennongding with altitude of 3105m, always known as “The First Peak in Central China”.

2. Industry

Hubei, the birthplace of modern industry in China, is one of the important old industrial bases and one of the three largest steel bases in our country. It is also the largest production base of medium, heavy, sheet plates and special steel, the second largest production base of automobiles and the largest production base of medium trucks, the largest production base of heavy machine tools and packaging machinery, the biggest hydraulic power base, and the largest production base of Join-alkali, agricultural chemicals, phosphorus, salt chemical industry and striate gypsum. It is also a national photoelectron information industrial base in China and one of modernized traditional Chinese medicine bases and important textile bases. It has established a distinctive industrial system, forming a pattern with automobile, steel and photoelectron information as advantaged industry.

(I) Automobile Industry

With the construction and development over 50 years, the mechanism and automobile industry in Hubei province has established the industrial foundation with “one leading industry and two belts”. “One leading industry” refers to take the automobile industry as the leading role, building a wide range of 13 industries with rich strength such as machine tools, electrical appliances, instruments and meters, general petrochemical machinery, heavy mining machinery, food packaging machinery, general basic parts, engineering machinery, agricultural machinery, internal combustion engine, cultural office equipment, civil machinery and so on. “Two belts” refers to the two centralized belts, including an automobile industry belts based on the Dongfeng Motor Company in Shiyan, Xiangfan and Wuhan and a large technical equipment belt based on Yichang, Jinzhou, Wuhan and Huangshi, which brought about an industry pattern supported by a large number of big corporations and companies such as Dongfeng Motor Corporation, Dongfeng Peugeot Automobile Company, Tri-ring Group Corporation, Wuhan Kaidi Electric Power Co., Ltd, Wuhan Boiler Co., Ltd, China Chang Jiang Energy Corp.(Group), China Shipbuilding Industry Corporation Wuchang Shipyard and so on. Dongfeng Motor Corporation has realized multinational reorganization with Nissan Motor Co.,Ltd, enhanced operation with PSA Peugeot Citroen and expanded operation with Honda, which marked that Dongfeng Motor Corporation has stepped into the queue of international big companies; after reorganization with the automobile corporations in Hubei province, Tri-ring Group Corporation has further enhanced its strength. As one of the three big production bases for manufacturing automobile components and parts, Hubei Province has achieved a productivity of 800,000 entire vehicles. On the whole, it has formed a product structure which pays equal attention to “limousine, heavy, medium, light and special” and the wide range of vehicle type. Due to the rapid development of entire vehicles, the components and parts industry in Hubei has strengthened day by day. At present, there are more than 700 components and parts enterprises in Hubei (of which there are more than 310 enterprises above the scale), and the annual capacity to provide the auxiliary items exceeds 600,000 vehicles. The industrial output accomplished by the top 10 big companies in this industry take up more than 60% of the total industrial output accomplished by the mechanism and automobile industry in Hubei.

(II) Information Industry

The information industry in Hubei Province maintained comprehensive, rapid and effective development. The scale of manufacturing industry grew in duplication. The government affairs, enterprises and social informatization have been push forward in an all round way. The informatization level has improved remarkably, and the wireless infrastructure construction is highly effective. Supervision competence is strengthened time and again. The function and status of information industry in the national economy and social development has been reinforced at large, which lays a solid foundation for the sustainable development of “10th Five-year Plan”. As a result of the construction and development, the information industry in Hubei Province has formed a development pattern featuring optical communication, mobile communication, laser, display, chemosynthetic foil electronic material and software industry. The scale of optical fibers and cables industry is in the first place at home and the third place in the world, and the research and development as well as the production scale of the optical communication come out at the top in China; the output of micro-midi broadcasting station and mobile base station antenna system is on top at home, the same with the production scale of laser; production of mobile phone, display and air condition respectively has formed a scale of 10,000,000 sets; the production scale of chemosynthetic foil electronic material is also on top at home with an output of 50,000,000 square meters; by the same token, the software industry provided with domestic considerable foundation and strength is in full flourish. As to the industry structure of the information industry in Hubei Province, it has changed from the single manufacturing industry in the past to the modern information industry integrated by manufacturing industry, software industry and information service industry. The product structure with dominant investment class products in the past has entered into an amenable environment in which the products of investment class, consumption class and foundation class are developed side by side. By means of developing the photoelectron information and organizing and optimizing some essential elements including industry, qualified personnel and resources, Optical Valley of China (Wuhan) has rapidly developed into the biggest photoelectron information industry base in China.

(III) Light Industry

Hubei Province, one of the largest provinces in China in respect of light industry, has established a self-contained light industry system with a wide range of products, including 22 categories and more than 40 industries such as subsidiary foodstuff processing, foodstuff manufacturing, drink, crude salt, leather, cabinetmaking, paper making and paper products, stationery and sporting goods, chemical industry concerned with products for daily use, plastics, household electrical appliances, illuminating electrical appliances, articles of artistic industry and so on. The major light industries in Hubei Province, including foodstuff and drink, household electrical appliances, paper making, plastics, crude salt and so on, which is playing an important role at home and provided with relatively strong comparative advantage. The subsidiary foodstuff processing industry ranks the 10th place in China the foodstuff manufacturing industry ranks 12th, drink manufacturing ranks 8th, paper making and paper products industry ranks 10th, plastics industry ranks 11th, and household electrical appliances manufacturing industry ranks 10th. Moreover, there are many national renowned native enterprises concerning light industry in Hubei, such as Jingshan Light Machinery Group Co., Ltd., Angel Yeast Co., Ltd., Kaile Science and Technology Co., Ltd., Hubei Yuli Abrasive Belt Co., Ltd., Hubei Baiyunbian Wine Co. Ltd., Zhijiang Wine Co., Ltd, Jing Brand Co. Ltd. and so on. Meanwhile, Hubei Province is provided with a large number of Chinese well-known brand products, including “Kinglong” Beer, “SLEK” cosmetics, “Dongbei” refrigerator compressor, “President” juice, “Jinhuang” jewelry, “Lianle” mattress, “Daqiao” chicken essence, “Jinchen” toothbrush, “Jinlan” jewelry and so on. With more open up to the outside world and improvement on the investment environment, a large number of national and international renowned enterprises concerning light industry have settled in Hubei, including Coca-Cola, Pepsi, Philips, Budweiser, Red Bull Drink, Hair, Little Swan, China Resources Power, Tsingtao Brewery, Wahaha, Huiyuan, TCL, Nongfu-shanquan and so on, which have further strengthened the Hubei light industry.

3. Technology

National key laboratories

Hubei has more than 10 national key laboratories and more than 1,200 scientific research and development institutions. 7 years ago, they have achieved outstanding academic accomplishments with 750 provincial and ministerial level scientific and technological achievement and 28 national high-tech industrial development projects with total investment of 3.0 billion RMB Yuan.

Human Resource

Hubei province is abundant in labour resources with 36.2 million employees. It ranks the first among all the cities in the number of college students on campus. The 3551 Talent Project of the East Lake National High-tech Innovation Demonstration Zone has an annual investment of no less than 150 million RMB yuan. There were 64 academicians and 118 persons from “One Thousand Talent Program” in Hubei province, coming out top in China. The scientific research level and production capacity in the hi-tech fields such as photo-electronic information, new-type materials, bio-engineering and new medicine, aviation, laser, digital control technology and computer software development is superior all over the country.

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