"Xiamen has felt the pressure from the two regions, but that also brings opportunities to us," said Mayor Zhu Yayan, in an interview with reporters during the Fifth China International Fair for Investment and Trade (CIFIT).

One of the closest cities to Taiwan, Xiamen has long been a favourite place for Taiwanese investors. However, with China's rapid development, much investment has flowed to regions centred around Shanghai and Guangzhou.

However, Xiamen has kept up with the competition. According to Zhu, at the end of June, 72 investment projects totalling more than US$140 million in capital had been approved. With the improvement of its economic environment, Xiamen continues to attract large projects. One Taiwanese chemical company has invested about US$1 billion in the past year alone.

Close ties between Xiamen and Kinmen, an island, which, under the Taiwan rule, is just off the mainland coast, also continue to strengthen the economic development of the city.

"More than 2,000 people from Kinmen have bought houses in Xiamen, which are worth more than 150 million yuan (US$18.1 million), since the direct sail began in January," said a businessman from Kinmen.

Xiamen continues to act as a bridge between Taiwan and cities in Fujian, Guangdong and Jiangxi provinces. The city has spelled out an ambitious plan to build itself into an economic centre of the three provinces and has organized a 13-City Economic Co-operation Zone.

"Xiamen will act as a hub for businesses in the region and encourage Xiamen firms to set up companies in the area to take advantage of the rich resources and cheap labour and land costs," said Xu Mo, director of the Development Planning Commission of the city.

Mayor Zhu also declared that Xiamen had recovered from the Yuanhua smuggling scandal that involved more than 300 suspects and 80 billion yuan (US$9.7 billion) worth of smuggled goods.

He said Xiamen had witnessed a rapid growth in gross domestic product (GDP) and trade. According to statistics from the municipal government, its GDP grew by more than 11 per cent from January to August year-on-year, while exports rose by 9.7 per cent to reach US$4.1 billion.

Overseas investment also increased by more than one-third in the first eight months and large foreign companies including Kodak, Dell and General Electronics have expanded their production in the city this year.

(China Daily 09/10/2001)