Dalian High-Tech Industrial Zone

Rating
Year of Establishment March, 1991
Land Area 13 km2
Location Dalian, Liaoning
GDP (Value-added industrial output) RMB 26.2 billion (US$3.5 billion)
FDI N.A.
Utilized FDI N.A.
Major Investors Genpact, IBM, HP, Accenture, Panasonic, Sony, Hitachi, NTT, NCR, Zhenao
Major Industries Encouraged Software and information services, biotechnology and pharmaceutical industries, new materials

Introduction

Dalian High-Tech Industrial Zone (Dalian HTIZ) is located in a particularly academic area of Dalian, being surrounded by universities and institutes. It consists of six areas, including Qixianling Base, Double D (Digital and DNA) Port, Pioneering Park, Software Park, Lvshun Software Belt and Longtou Industrial Park, all of which are within half an hour’s drive from the downtown area.

Dalian HTIZ has convenient transport conditions. It is 13 km away from Dalian Port, which is the nation’s seventh-largest port. Dalian also utilizes trains for delivering bonded freight to Harbin and Shenyang. The rail distance from Dalian to Shenyang is 400 km; to Harbin, 950 km; and to Beijing, 1,070 km.

Dalian HTIZ is 20 km from the Shenyang-Dalian Highway, and 10 km from the Dalian International airport. The airport was China’s thirteenth-largest airport in terms of throughput in 2007.

Investment Climate

In 2007, the value-added industrial output of Dalian HTIZ reached RMB 26.2 billion. At present, there are over 800 foreign companies in Dalian HTIZ; 43 of these companies belong to the Fortune 500, including IBM, HP, Panasonic and Sony. The pillar industries of Dalian HTIZ include software and information services, research/production of biotechnology and medicine, and new materials.

Software is the most important industry in Dalian HTIZ. Dalian is one of the nation’s service-outsourcing bases, and its revenue in software industry reached RMB 21.5 billion in 2007. Due to the preferential policies in Dalian HTIZ, many investments have poured in, including a joint project which has been launched between Dalian HTIZ and the Singapore-based Ascendas Group to set up a software park in Dalian HTIZ, involving an investment of US$200 million.

There are many software companies in Dalian HTIZ, all of which have target markets in Japan, South Korea, Singapore, Europe and US. A large number of universities are located near Dalian HTIZ, which has proven useful for software development companies looking to recruit new employees, many of whom can speak Japanese, Korean and English. Currently, there are 326 software companies in Dalian HTIZ, 41% of which are invested by foreign companies, including Genpact, IBM, HP, Accenture, Panasonic, Sony, Hitachi, NTT and NCR.

In the first half of 2008, the software and service outsourcing industry of Dalian HTIZ generated revenue of RMB 10.7 billion, which was 50.1% higher than the same period in the previous year. Over 30% of the revenue came from overseas business. At present, there are nineteen outsourcing companies with annual revenue of over RMB 10 million, as well as forty enterprises from the Fortune 500.

Biotechnology and medicine constitutes another pillar industry of Dalian HTIZ. Located in the Double D Port, Dalian Biological Medicine Industrial Park was established by the Ministry of Science and Technology as the national biotech and medicine industrial base. Zhenao, Yawei, Meichuang and Huiren are the major investors in this sector.

R&D capability is the major advantage for Dalian HTIZ. It has the only national IC design base in north-east China. At present, there are 95 R&D institutes in Dalian HTIZ. Each year, over RMB 150 million has been invested into Dalian HTIZ, making it the leader in terms of R&D capability in north-east China. By the end of 2007, over 2,400 patents had been acquired by the companies in Dalian HTIZ.

Investment Costs

Land Costs

Purpose of Usage Land Cost (RMB/m2)
Industrial 530

Source: Administration Committee of Dalian HTIZ

Utility cost

Purpose of Usage Gas (RMB/m3) Water (RMB/m3) Wastewater Treatment (RMB/m3) Electricity (1kv-10kv)
(RMB/kwh)
Residential 2 2.3 0.6 0.389
Commercial 3 3 0.6 0.729
Industrial 2.7 3.2 0.9 0.398
Other 3 19.0 1 0.544

Source: Administration Committee of Dalian HTIZ

Winning Edge and Limitations

Winning Edge

  1. Dalian HTIZ has strong R&D capability.
  2. Dalian is the financial center of north-east China, and has a large number of foreign banks.
  3. Dalian facilitates a good engineering education at the well-known Dalian University of Technology. This is especially useful for software companies looking for new graduates and under-graduates who are seeking employment.
  4. Dalian is close to Japan and Korea; the geographic advantage allows the attraction of more outsourcing opportunities.

Limitations

  1. The investment cost in Dalian is relatively high when compared to other cities of Liaoning, especially in terms of labor costs.
  2. The surrounding area of Dalian is less developed than the other coastal areas of China in the east and south.

The Administration Committee

  1. Address: R 208 No 1 Gaoxin Street Qixianling Industrial Base, Dalian Hi-tech Zone, Dalian, P.R.C  116025
  2. Tel:  86-411-84793643/84793619/84793617/84792754
  3. Fax:  86-411-84793620
  4. Website:  http://www.ddport.com/

Share
Tags: