"Fortunately, he is only two years old," said Dieter, general manager of the Xi'an-based Siemens Signalling Company.

The German, in his 30s, had just returned to his eye-catching office after seeing off his Chinese colleague at the airport.

"Other than that, you can find everything here you'd want as a foreigner," he said.

Dieter has lived in China for four years and settled in Xi'an earlier this year. He said his company decided to move to the inland city six years ago because it found a good local partner and support from local authorities.

"In the end, it is more important to choose the right partner than the location," Dieter said.

Siemens Signalling, with Siemens claiming a 51 per cent stake and the local company Xi'an Signalling taking 49 per cent, manufactures signal equipment and systems for railways and urban roads. It has been honoured as a top 10 foreign-funded company in Xi'an every year since 1997.

But why are most of Siemens Group's business, like IT, power generation and electronics, located in eastern cities such as Shanghai and Guangzhou?

"Compared with the western areas, eastern regions are convenient for people who travel internationally to get in and out of. So it is easier for foreign-funded companies to locate their employees in the country's east," Dieter said. But the west has been catching up ever since China decided to launch its western development campaign in 1999 to improve the infrastructure there, he said.

"Like Xi'an, it has an international airport and extensive traffic network now. In addition, you can find qualified engineers here. No problems for businesses here now," he said.

Also, foreign companies have been lured by specific benefits provided by the local government, such as tax and loan favours.

Dieter said that with more infrastructure construction in the west, more opportunities arise for the company to provide equipment for the construction.

"The market will grow faster than expected," he said.

Dieter said the company has decided to turn itself into the supply centre of signal equipment in China and all of the Asia-Pacific region.

"We are not only working for western China, but for China as a whole," Dieter said. "We will put more emphasis on the west with this campaign."

As for life in Xi'an, a city which was capital of six dynasties, Dieter said many foreigners prefer Xi'an to Shanghai.

"Xi'an itself is full of history," he said.

He said he likes exploring the city with his family and playing golf.

"Xi'an is full of surprises," he said. "You can even find DVDs (digital video discs) in the German language."

(China Daily December 5, 2001)