Hangzhou Export Processing Zone (Hangzhou EPZ), which received its nod of approval from the State Council in 2000, has a planned area of 3 km2. Nestled in the Hangzhou Economic and Technological Development Zone, east of Hangzhou city, it is located an equal distance from Shanghai, Suzhou, Shaoxing and Ningbo. The zone is a mere 1.5-hour drive from the four cities.
Hangzhou EPZ is 15 km away from Hangzhou Xiaoshan International Airport, which operates 149 domestic airlines and 32 overseas airlines. It is also close to Ningbo-Zhoushan Port and Shanghai Port, two of China's most important deepwater ports.
The central axis of Zhejiang province's expressways was built in the zone, connecting the Hangzhou-Nanjing, Shanghai-Hangzhou, Hangzhou-Jinhua-Qutang and Hangzhou-Ningbo Expressways. Additionally, it also has a well-established railway network, as the Shanghai-Hangzhou, Zhejiang-Jiangxi, Xiaoshan-Ningbo and Xuancheng-Hangzhou railways intersect in Hangzhou city.
Investment Climate
As one of the first batch of export processing zones approved by the State Council, the zone enjoys favorable policies that exempt it from duty, bonded duty and license. Electronics, telecommunications and home appliance industries are encouraged in this area.
The electronics industry plays an important role in the zone's economic development. Between January and June in 2008, it realized an industrial output value of RMB 4.7 billion, accounting for 85.5% of the export processing zone's total. In addition, it has attracted a number of Fortune 500 enterprises, such as Toshiba, Matsushita and Alcoa. The zone's FDI totaled US$144 million in the first two quarters of 2008, nearly triple the amount in the same period last year.
However, in the first half of 2008, it realized GDP of RMB 5.5 billion, about 23.9% down from the preceding year, accounting for 9.1% of Hangzhou Economic and Technological Development Zone's total. Export value stood at US$676 million, down 19.8% year-on-year. The decrease of GDP and export value can be attributed to the rising labor and material costs, appreciation of RMB, and the change in production structure of Panasonic and Toshiba, whose export values account for nearly two thirds of the zone's total.
Investment Costs
Land Costs
Area
Purchasing Price (RMB/m2)
Level 1 Zhonghe Road; South: Hefang Street, Border of West Lake Reserve; West: Tiyuchang Road, West Section of City Ring, Miduqiao Road, Great Canal, Overhead Viaduct
1,530
Level 2 East: Dongxi Road, East Section of City Ring, Railway, Jiangcheng Road; South: Wansongling Road, Border of West Lake Reserve; West: Shuguang Road, Border of West Lake Reserve, Yugu Road, Tianmushan Road, Jiaogong Road; North: Wenshan Road, Wenhui Road, Shangtang Road, Chaohui Road
1,220
Level 3 East: Shaoxing Road, Wenhui Road, Airport Road, West of Genshan Road, North of Qiutao Road, Qingchun Road; South: Qiangtang River, Lower part of Zhonghe Road, Border of West Lake Reserve; West: Yugu Road, Yuxi Road, Guicui Road; North: Wenyi Road, Desheng Road
970
Level 4 Northern Part: East:: Great Canal; South: Qiantang River; West: Yuxi Road, Zijinhua Road; North: Yutang River, Great Canal, Huzhou Road, Shaoxing Road, Xiangjishi Road, Dongxin Road, Desheng Road, the intersection of Caowang Road and Shiqiao Road Southern Part: East: Fuxi Bridge; South: Qiantang River; North & West: Border of West Lake Reserve
750
Level 5 Northern Part:: East: to the railway; South: Qiantang River; West Xixi Road, Border of Xixi Reserve, Zijingang School of Zhejiang University; North: Guihua Road, North Railway Station, Xitang River, Guihua Dinghai Road, Great Canal, Shixiang Road, Dongxin Road, Zhonggong Road, to the railway Southern Shore of Qiantang River, Xiaoshan District
390
Level 6 Northern Part (excluding Level 5), Southern Shore of Qiantang River (excluding Level 5), Zhijiang National Holiday Reserve
300
Source: Department of Land & Resources of Hangzhou Municipality, 2004
Utility Costs
Purpose of Usage
Electricity (1kv-10kv) (RMB/kwh)
Water (RMB/m3)
Waste Water Treatment Fees (RMB/m3)
Gas (RMB/m3)
Residential
N.A.
1.35
0.50
2.4
Government
N.A.
2.00
1.50
3.0
Commercial
N.A.
1.9
1.50
3.0
Industrial
0.556
1.75
1.80
3.0
Others
N.A.
4.0
1.50
3.0
Source: Management Commission of Hangzhou Economic & Technological Development Zone, China Water, Hangzhou Gas
Logistic Costs Air Freight Costs (RMB/Kg)
Seoul
Taipei
Singapore
Sydney
Hangzhou
12
10.50
14.00
31.5
Source: Hangzhou Xiaoshan International Airport (based on the prices of Air China)
Labor Costs Reference Salary at Labor Market
Average Wage (RMB/month)
Junior
900-1,300
Technicians
1,300-3,000
Engineers
2,500-8,000
Senior Management Staff
Flexible
Regulated Lowest Wage
850 in city, 750 in Xiaoshan District
Source: Administrative Committee of Hangzhou Economic & Technological Development Zone
Winning Edge
Well-established industrial and economic base
Advantageous geographic location
Strong ties with Hangzhou Economic and Technological Development Zone, which provides potential customers and suppliers
Rich human resources and a large talent pool
Limitations
Many export-oriented enterprises are located in this zone, which exports mainly to the U.S., EU and Japan. The decreasing figure in exports indicates that they have been heavily affected by the cooling global economy and rising RMB-to-USD exchange rates.
Scarcity of mineral resources and shortage of electricity supply
The Administration Committee
Address: Yindu Mansion (Xiasha), Hangzhou Economic and Technological Development Zone, Hangzhou 310018, Zhejiang Province
