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The sectors that local government encourages foreign investment include infrastructure, basic industries, high-tech industry, export-oriented production bases, comprehensive agriculture projects and technical innovation of old enterprises.

The projects that the local government encourages foreign investment include: construction of Hongshui River hydropower station and other hydro- and thermal power stations, river and sea ports, rail roads and high-grade highways. Those projects in which foreign investment is just permitted include: real estates and the development of large pieces of land. Those belonging to the tertiary industry will be open to foreign investment step by step, which include: finance, trade, transportation and tourism. It is encouraged that township and private enterprises make efforts to lure foreign investment or do manufacturing with imported materials and models.

The existing enterprises are encouraged to do technical innovation by using overseas funds. While establishing Chinese-foreign joint ventures or corporations, the Chinese side is permitted to be a shareholding partner in terms of land, workshop, equipment and property. These enterprises may try a new system called ?one factory, two systems.? Under this system, a state-owned enterprise may allow one or several subsidiaries of it to do joint venture with foreign partners. The foreign side may join the shareholding company with its advanced techniques. Foreign investors are encouraged to run Chinese enterprises of state, collective and private ownership by contract.

Foreign investors are encouraged to develop large stretch of land, where infrastructure has not been constructed yet. After acquiring land-using license, the foreign developers are permitted to do all the planning and designing except post and telecommunication and port construction. Those construction projects in the foreign-developed zone, which are not fit in with the general plan of civil engineering made by the local government, should be submitted to the government departments concerned for examination and approval.

The land-use period for foreign developers may be as long as 70 years, during which the land can be transferred, leased and mortgaged. The foreign developers are allowed to enjoy a 10-30 percent discount in paying the land-use fees.

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