Editor’s Note: A recent report shows that the provinces with the best environment for investment are generally located in East, South, and Central China. However, some of these areas face a number of challenges including rising cost of living and pollution. This author believes that West China can become more competitive by improving its environment for soft investment.
A new report shows that investment in Northeast China has fallen behind that in the rest of the country.
The 21st Century Economic Research Institute recently released a report titled Investment Environment Index 2016. The report analyzed markets, cost of business, infrastructure, social services, and more to measure the environment for investment in different regions in China.
Best Regions for Investment
The top ten regions for investment in China in 2016 were Guangdong, Jiangsu, Shandong, Zhejiang, Fujian, Beijing, Chongqing, Henan, Sichuan, and Hubei. The ten regions that have fallen behind in terms of investment were also listed. Two Northeastern provinces were included in the list, and Heilongjiang was number one. The rest of the provinces were located in the west.
The best environment for soft investment is Guangzhou. Investment in start-ups and private enterprises is also the best in Guangzhou. Shanghai has the best infrastructure, followed by Beijing.
Beijing has the highest number of college graduates in China. The city’s medical services and science and technology industry are ranked first in the nation. Shanghai is ranked second.
High Costs and Pollution Deter Investors
In terms of business costs, housing prices are the highest when compared to income in Beijing and are the highest in general in Shanghai. The high cost of doing business in these cities can make them less attractive for investors.
The air quality and ecological environment is generally poor in China’s economically developed regions. Shandong, Jiangsu, Tianjin, Shanghai and Beijing are ranked last in terms of ecological environment. The air quality is best in Yunnan and Hainan—Hainan has the lowest PM2.5 index in the country.
A Path for West China
The report suggested that regions in West China should improve their environment for soft investment as soon as possible. Western regions have recently increased their investments in fixed assets. However, these regions should also focus on social investments. These will help promote stable local economies and rapid development.
21st Century Economic Research Institute’s Comprehensive Development Level Index 2016 lists Beijing, Zhejiang, Shanghai, Guangzhou, and Jiangsu as the top five provinces in terms of comprehensive development. East China is the most developed, followed by Central China. Northeast and West China have the lowest level of development.
Source: QQ News
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Keywords: China investment China investment environment
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