This year, in order to cool down the overheated economy, the
central government has called a halt to 4,150 land development
projects nationwide. About 70 percent of plans to construct
commercial and industrial development zones have been cancelled,
saving 64.5 percent of land scheduled for occupation, according to
official statistics.
The situation has led the Tianjin Economic-Technological
Development Area (TEDA)
administration to increase land efficiency by implementing a policy
of "developing without new land."
As early as 1991, TEDA met a target of 1 yuan worth of land
attracting 2 dollars of investment for industrial projects that
should produce 3 dollars of output value annually.
Since its establishment in 1984, the area has continued to
expand investment density and increase the number of
technology-intensive projects to ensure stable economic growth,
according to Li Yong, director of TEDA Administration.
"TEDA regards every inch of land as gold," he said.
Land prices are set according to average per-unit investment and
industry.
Proposed projects must meet strict requirements before gaining
approval. Preference is given to those involving high investment,
high scientific and technological content, high profit potential
and low pollution.
All land-use plans must be examined by the administration to
avoid the waste of resources.
TEDA regulations also require construction to start within six
months after the land-use transfer contract is signed, and it must
be completed within two years.
Land users are not allowed to change the use of the land without
permission from authorities.
The regulations don't merely exist on paper: during the first
half of this year, the area administration confiscated 300,000
square meters of idle land or land on which construction had
stopped.
"Combining industrial structural reform and land use adjustment
is the key to TEDA's success," Li said.
Projects that occupy large areas but have not used the land
efficiently and are unprofitable have been gradually closed or
downsized. Their land has been or will be transferred to more
cost-effective projects.
Li indicates that this method sets the scene for the greatest
economic returns on limited land while spurring industrial
structural adjustment.
During the early years, many projects in the zone were of small
or medium size. Most of them have gone bankrupt in the past 20
years and their mortgaged land turned over to the banks.
The second round of the TEDA land development program is in its
trial phase. At present, the administration is establishing
procedures for changing ownership to enable the land to be
repossessed for new projects.
The new, strict land-planning controls have increased investor
confidence in the zone's future.
Twenty-two of the projects approved by the administration in the
first half of this year were large ones, each involving investment
of more than US$10 million. Another 37 are starting up with
investments of at least US$5 million.
Two projects with investment exceeding US$100 million each have
also been approved. About 97 percent of the funding will come from
abroad.
TEDA's efforts are paying off. The zone has met its target of
attracting US$500 million of industrial investment per square
kilometer of land, with industrial output per square kilometer
reaching 8.0 billion yuan (US$967 million). In both areas, TEDA has
taken the lead among development zones in China.
The area's total industrial output reached 125.0 billion yuan
(US$15.1 billion) last year, and its financial income totaled 9.3
billion yuan (US$1.1 billion).
TEDA, built 20 years ago on 33 square kilometers of salt flats
and wasteland, has developed into a new industrial zone of
international standard. The area was the first development zone to
use the transfer method of land allocation, a daring experiment in
a time when the government still distributed land free of charge In
July 1985, the area issued the TEDA Land Management Regulations
which concentrated on amortized payments for land.
(China Daily October 8, 2004)