China has just officially launched three new free trade zones that are modeled after the pioneering Shanghai Free Trade Zone. So how is the Shanghai FTZ doing now?

The Shanghai free trade zone is carrying the flag of China's comprehensive reform efforts. One of its most remarkable accomplishments was the negative list for businesses. People are now free to set up business operations that are not on the list. All they have to do is simply register with the authority instead of getting approvals that were required before the launch of the zone. That strategy seems to be working well. More than 10,000 companies were set up in the Shanghai FTZ last year. About a quarter of them are foreign-owned or have joint ownership.

"This is an innovation in administrating foreign investments. We let the market allocation resources as we now have less entry requirements from investors," said Wang Shouwen, assistant minister of Chinese Ministry of Commerce.

Another accomplishment is the streamlining of custom procedures. Logistics times were drastically shortened, greatly reducing costs for companies. Trade in and out of the zone rose 8.3% last year.

"We should reduce interventions as much as possible while maintaining the level quality controls," said Yu Guangzhou, deputy chief of General Adminstration of Customs.

Last but not least was financial reform. The central bank has allowed free convertibility of capital accounts in the zone, setting an example for additional financial innovations for the whole country. Officials say the reforms revolve around the idea that the government should change its role in the economy and that the 21 reform measures in the Shanghai FTZ will serve as examples for the new zones in Guangdong, Fujian and Tianjin.