Pingtan, the nearest island county to Taiwan from the Chinese mainland, plans to build itself into a special economic zone to court investors from Taiwan and elsewhere.

The experimental zone will offer industries from Taiwan favorable policies to encourage trade and communications between the two sides of the Straits.

"The experimental zone and preferential treatment are not exclusively to Taiwan. It's also open to the whole world - like Singapore, Hong Kong and the United States. Taiwan will be the focus," said Chen Wenbo, governor of Pingtan County.

The county is the fifth-largest island in China, almost twice the size of Hong Kong Island and Xiamen Island.

Pingtan is 126 km to Hsinchu, Taiwan, and 120 km to Fuzhou, the capital city of Fujian province. At present, the pillar industries of Pingtan include sea farming and transportation.

"We plan to attract high technology industries from Taiwan like software, optoelectronics, biological medicine and shipbuilding," Yu Zhaoqiang, director of the Pingtan Development and Reform Bureau, told China Business weekly.

Yu said experts from Chinese universities and governments, as well as experts from Singapore, will take part in the planning process.

"We hope to develop the island together," he said.

"The environment is a major concern. The industrial foundation of Pingtan is not well developed, and thus the environment of the island is good. We are trying to maintain a good environment," Yu said.

To provide lands for enterprises to be established, the county is rebuilding salt fields and marine farms to turn them into industry parks with a total area of 2,667 hectares.

"The output value of salt fields and marine farms is very low, usually several million yuan a year. But the annual output value of industrial parks can exceed 10 billion yuan, if they run well," said Ding Ruiwu, director of the Information Office of Pingtan.

The county has also planned a 667-hectare agricultural park to introduce seeds and planting skills from Taiwan and a 15-sq-km area to exchange experiences in cultural industry, education and research and development.

Local enterprises already have expressed interest in cooperating with their counterparts from Taiwan.

Fujian Sunshine Ecological Agriculture Development Co Ltd is a major pork producer in Pingtan with an annual production of 40,000 pigs.

"The room for our company to cooperate with Taiwan is big. For example, we have cheap land and fertilizers while Taiwan companies have advantages in technology and management, which is a perfect match," said company manager Yang Guangping.

"Besides, as traffic between the mainland and Taiwan develops, transportation costs will be lowered greatly. We slaughter pigs in the evening, and the pork can arrive in Taiwan early next morning," Yang said.

Pingtan also wants to develop tourism in the county with resources such as beaches, island forests and hills, officials said.

The county reached a $100 million agreement with Hong Kong Pacific International Investment Ltd to build a holiday village at the 13th China International Fair for Investment and Trade that closed on Sept 11.

"Pingtan held sand-carving festivals from 2003 to 2005 that contributed 1.5 percent to its yearly GDP growth," Ding said.

Favorable policies

Policies to support Pingtan to build the economic zone include allowing the county to keep all its fiscal revenues during the next 10 years.

Of the share of revenues from economic zone enterprises that traditionally would go to municipal and provincial governments, at least 50 percent will be refunded to those enterprises, officials said.

Municipal and provincial governments also will offer subsidies to build a 95.64-km road around the island. The five-year construction project is scheduled to begin next year.

In addition to expanding Fuzhou's bonded area to Pingtan, the county also will build an area under special customs supervision to facilitate trade between the mainland and Taiwan.

"At that time, people, ships and cargos of Taiwan will enter and leave Pingtan freely, just like it is their home," Governor Chen said, although he declined to provide more details.

Currently, massive infrastructure projects are under way in the county.

A 4,976-m Pingtan cross-Straits bridge (with a total investment of 1.4 billion yuan) will be completed in September 2010, ending the need to use ferries to reach the island. A second cross-Straits bridge is being planned.

An expressway connecting Pingtan and Fuqing, scheduled for completion in 2011, will shorten the travel time between Pingtan and Fuzhou to 1.5 hours.

Up to five ports, including a 200,000-ton-capacity port and two 300,000-ton-capacity ports, are being planned.

Electricity networks, wind power plants and nuclear power plants either are in operation or will soon begin construction.

The capacity of Pingtan's wastewater processing plant will be expanded from 10,000 tons per day to 30,000 tons per day, and another two plants will be built, officials said.

"With the geographic advantage and so much policy support, I hope Pingtan will become more prosperous than Xiamen and Dalian (a developed coastal city of Liaoning province)," Chen said.