> Foreign Investment

The contracted amount of FDI increased by 13.5% to US$ 0.5 billion in 2002. In Jan-Sep 2003, FDI increased further and the number of contracted FDI above US$10 million reached 18, a number that is larger than any whole year figure recorded before.

An increasing number of multinational companies have set up operation in Chongqing . These include Nokia, ABB, Ericsson, American Standard, Rockwell, Honda, Suzuki, Isuzu, Yamaha, Mobil, China Bank Group, Hutchison Whampao, Gold Lion Group and Samsung. Reportedly, more and more existing foreign companies have committed in investment expansion in recent years. For example, BP, giant petrochemical company in England , reinvested RMB1.2 billion in 2003.

The Chongqing government would like to attract foreign investment in the following five areas: transportation, hydropower station, charged wire fence, construction and real estate. It is noticeable that construction has become attractive to investors with the fastest growth in 2002.

To boost development of the central and western regions in China , the State council has granted further tax incentive to foreign-invested enterprises (FIEs) in China . Under the existing policy, FIEs are entitled to a three-year tax reduction and exemption. The new policy allows foreign-invested enterprises in the central and western regions to enjoy another three years of preferential tax rate when the current preferential term expires. The tax rate can be further reduced to 10% if an enterprise is proved to export more than 70% of its annual output in terms of value.