（Written by Li Min / Translated by Zhang Xiaoyan）One year ago, the Chinese central government officially approved the establishment of China (Guangxi) Pilot Free Trade Zone (CFTZ), which has made an important addition to the existing pilot free trade zones in the country.
As a big project planned from a strategic perspective and implemented from small details, CFTZ is intended to be built into a high standard and high-quality area that will lead the opening up and cooperation between China and ASEAN, with “China-ASEAN cooperation” being an important element of CFTZ, as directed in the Master Plan of China (Guangxi) Pilot Free Trade Zone (Master Plan) approved by the national government.
Over the past year, what new progress has Guangxi made in promoting CFTZ, what new measures have been taken in playing the “ASEAN trump”, what innovative experiences have been gained, and what plans will be made for the future? With these questions in mind, the reporter of China-ASEAN Panorama made an interview with Jiang Liansheng, Director-General of the Department of Commerce of Guangxi Zhuang Autonomous Region and Director of China (Guangxi) Pilot Free Trade Zone.
Jiang Liansheng, Director-General of the Department of Commerce of Guangxi Zhuang Autonomous Region and Director of China (Guangxi) Pilot Free Trade Zone
Going all out to build CFTZ
“In the past year, CFTZ has completed 58 of the 120 pilot reform tasks assigned by the Master Plan, with a cumulative completion rate of 48.3%; 162 administrative authorities at autonomous region level have been delegated, and 545 pilot reform projects of full coverage “separation of certificate and license” have been implemented; 10,561 new enterprises have been established, including 85 foreign-funded enterprises; and the amount of foreign capital paid has exceeded US$ 140 million, accounting for 13.8% of the total amount of Guangxi in the same period; the import and export volume of foreign trade has exceeded RMB 130.8 billion yuan, accounting for 30.9% of the total amount of Guangxi in the same period,” Jiang Liansheng summed up the remarkable achievements of CFTZ scored in the past year with a string of data, which fully demonstrates the resolution and determination of Guangxi to build the FTZ with all resources available in the whole region.
According to Jiang Liansheng, CFTZ has initially established a system guarantee system, with a command system of “Leading Group + Commander (Office) + Work Department + Areas” formed; it has issued the “Implementation Plan of China (Guangxi) Pilot Free Trade Zone Construction” and other special supporting policies; and it has also created an index system for promoting the work comprehensively and efficiently.
One of the important indicators of the building of FTZ is to create a world-class business environment. “The evaluation system for the world-class business environment the World Bank adopts has been used in our work to carry out the construction of CFTZ,” said Jiang Liansheng. He also added that in addition to delegating administrative authority, CFTZ also makes great efforts to ensure the business environment is regulated by law; to streamline the administrative approval flow so as to save the troubles of applicants, with more data utilized efficiently; to evaluate business environment properly, with third-party institutions entrusted to further sort out the business environment of the three areas under CFTZ, so as to have a general understanding of the business environment from multiple dimensions and perspectives and to be updated about their sense of gain by tracking the enterprises in FTZ.
The systematic and comprehensive evaluation conducted by Deloitte Consulting (Shanghai) Co., Ltd. shows that major achievements have been made by CFTZ in the first year of its inception in seven aspects, including the deepening of the reform of “streamlining administration, delegating powers, improving services”, the continued effect of investment liberalization, the increased trade facilitation, the boosted customs clearance facilitation, the enhanced financial innovation ability and openness, and the developing innovative modern service industry, and the improved quality of gateway construction.
Serving China-ASEAN cooperation: Guangxi experience gained from “experimental fields”
CFTZ is neither the first nor the only one of the pilot free trade zones in China, so in order to prevent homogeneous competition and make the most of its own advantages, CFTZ has to play well the strategic role in “leading the China-ASEAN open cooperation”, which is assigned by the Chinese central government.
According to Jiang Liansheng, over the past year, CFTZ, focusing on this strategic role, has made efforts to provide important open platforms for China-ASEAN cooperation, with projects such as China-ASEAN Trading Platform of Characteristic Bulk Goods, and China-ASEAN Economic and Trade Center being promoted; made institutional innovation for the facilitation of Chinese investment and trade in ASEAN; promoted cross-border labor service cooperation; and expedited the formation of supply chains of international industrial chains opening to ASEAN, for example, the automobile industry chain built based on the “Two Countries, Twin Parks” of China and Malaysia, China-Vietnam Pingxiang Sannuo electronic information industry chain, the cross-border high-end electronic information industry chain of Nanning City, and the international land transportation supply chain with the Youyiguan Port in Pingxiang and the Beilun River No.2 Bridge in Dongxing as the main land gateways.
Based on these achievements, CFTZ has gained plenty of innovation experience with Guangxi characteristics in “experimental fields”, which highlights three distinctive characteristics of the FTZ, namely, “serving China-ASEAN cooperation, joint development of land and sea transport, and opening in border regions”, and the exploration of differentiated development model with institutional innovation as the core task.
First, efforts have been made to explore new experiences in supporting the building of the New International Land-Sea Trade Corridor. “Over the past year, we have carried out institutional innovation in the Qinzhou Port Area of CFTZ, focusing on trade facilitation, investment liberalization, and logistics standardization, so as to effectively promote the clustering of international trade logistics businesses,” said Jiang Liansheng. He continued to say that for example, they have initiated the mutual recognition mechanism between railway containers and sea containers, set up overseas return points of railway containers, and created the full-range international multimodal transport mode featuring “direct transport with original containers that are returned at destination overseas”. We have also created a “one-price” and “one-bill” customized service for international multimodal transport. We will build a “single window” for international trade, namely, the “Smart Bay” project.
Second, efforts have been made to explore new ways to promote economic development in border regions. CFTZ has innovated the new mode of “centralized declaration, integrated import and export” for cross-border trade, developed mobile phone app for border residents to make trade declaration. As a result, the paperless customs clearance of border residents has achieved a full coverage, the overall customs clearance time has been cut by more than 75%, and the transportation cost of enterprises reduced by RMB 3,000-6,000 yuan per vehicle.
We have established a “Bank+Service Center” mode for cross-border RMB use in border areas, so as to facilitate trade settlement among border residents. We have created the management mode of “four certificates, two insurances and one center” for the cross-border labor cooperation between China and Vietnam, built a joint examination platform for cross-border labor service cooperation, with the “online declaration” and “single window issuance” of cross-border labor certificates achieved and developed a face recognition management system for migrant workers, which has covered 380,000 persons in accumulation, with 323 enterprises benefited.
Third, efforts have been made to explore new models of deep opening and cooperation with ASEAN. CFTZ has actively promoted the implementation of all information intelligent customs clearance at the customs of Youyiguan Port, where the joint inspection department implements “multi-in-one card” and “face recognition”, with one-stop “customs clearance by seconds” (no more than 30 seconds) achieved, and the average customs clearance time cut by more than 80%, resulting in the annual cost of enterprises reduced by about RMB 200 million yuan, and providing the pioneering experience of the national border land port in China. The mutual recognition of Authorized Economic Operators (AEO) with ASEAN countries like Malaysia and Singapore has been vigorously promoted. We will create the opening financial ecology with China-ASEAN cross-border financial reform and innovation as the representative.
Sailing to a bright future
According to the deployment of the Chinese central government, a pilot free trade zone shall be completed in construction within 3 years on its approval in principle. So what should be done in the next stage? Jiang Liansheng said that CFTZ will make the most of “uniqueness” and work hard on “construction”, with differentiated development explored.
“We will continue to work hard to complete the 120 pilot projects of reform in an all-round way, more than 70% of which are to be completed as scheduled by the end of 2020. Therefore, the next step of our work should focus on the completion of the reform pilot tasks, with each of them properly fulfilled,” said Jiang Liansheng. “Secondly, we should generalize good experience based on real cases that can be modeled on elsewhere, as is also the core task of the construction of each pilot free trade zone in the country. We will focus our efforts on three aspects, namely, the innovation of customs clearance facilitation of the new land-sea trade corridor, the innovation of border economic cooperation, and the reconstruction of industrial chain intended for the China-ASEAN cooperation.”
In addition, to improve the business environment and further promote the clustering of open economy in CFTZ will also be the priority of the next step, according to Jiang Liansheng.
“After the 1st anniversary, we are faced with a more arduous task of reform. As the pilot tasks of ‘easy to reform’ have been completed, the rest will be the deep-water areas for undergoing reform. However, I believe that with the full involvement of all stakeholders, CFTZ, as the highest platform for opening development, will make its contribution to leading other open platforms,” said Jiang Liansheng.
Source: China-ASEAN Panorama