Wuhan, the capital of Hubei Province, is the core city of the Yangtze River economic belt, the pilot area of comprehensive innovation and reform, and one of the three major intelligence intensive areas in China. To invest in Wuhan, Hubei Province is different from other cities in China, such as Shenzhen, Beijing, Shanghai, Guangzhou, etc,compared with these first cities.
The GDP of Wuhan reached RMB 1,484 billion in 2018 with a YOY increase of 10.7%, accounting for 1.6% of China’s total GDP in 2018. Ten years prior, the GDP of Wuhan was RMB 396 billion, accounting for 1.3% of China’s economy. With an overall GDP of almost RMB 1.5 trillion in 2018, Wuhan’s economy is the 9th largest in mainland China. The economy of Wuhan increased nearly four-fold in ten years, due to special industrial zones, foreign investments and a pool of educated workers.
The role of Chinese special industrial zones in the development of Wuhan’s Economy
Due to its position at the confluence of two economic models, China is famous for creating special economic zones and special industry zones to cater to special markets in designated spaces. Special industry zones are areas that are designated by the national government to protect one certain industry from encroachment by others within its zone. These areas are increasingly promoted throughout mainland China to bolster GDP growth and target growth in certain sectors.
One example of Chinese special industry zones specific to Wuhan is the Donghu New Technology Development Zone. Also called Optics Valley, Donghu New Technology Development Zone was established in 1988 to promote the development of high-tech industry in China, especially in regards to fiber optics. Today, Optics Valley is home to both startups and large multinational corporations who were lured by the area’s financial incentives and talent base. A few notable companies that have a large presence in Optics Valley are Motorola, Huawei and Lenovo. According to statistics from the provincial government, only eight of the many companies invest RMB 40 billion in this special industry zone every year.
Wuhan Company Registration-Major Company Forms in Wuhan
Foreign investors can invest in Wuhan through legal or non-legal entities. Legal entities that can be set up by foreign investors generally include wholly foreign-owned enterprises (WFOEs), equity joint ventures (EJVs), co-operative joint ventures (CJVs) and joint stock companies (JSCs). Nonlegal entities include representative offices (ROs) and branches, as well as certain CJVs. The partnership also is available as an investment vehicle.
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