China (Chongqing) Pilot Free Trade Zone (Chongqing FTZ or CFTZ) is a regional free trade zone set up by the Chinese government in Chongqing. It covers an area of 119.98 km2, containing three parts –Liangjiang New Area, Xiyong Area, and Guoyuangang Area. CFTZ was approved to establish by the State Council on March 15, 2017. The State Council issued the Master Plan for China (Chongqing) Pilot Free Trade Zone on March 15, 2017. Chongqing FTZ was officially established on April 1, 2017.
Strategic Orientation of Chongqing FTZ
Chongqing FTZ aims to encourage system innovation, and its basic requirements are to make the relevant innovated policies replicable and promotional. It supports Chongqing to be the strategic fulcrum and connection in western China under the plan created by the Central Committee of the Communist Party of China and the State Council. Chongqing is making significant efforts to build Chongqing FTZ as the geographical hub of the Belt and Road and Yangtze River Economic Belt, as well as the essential pivot of Western China Development Strategy.
After three to five years of reform and exploration, Chongqing strives to build a high-level and high-standard free trade zone with convenient investment and trade, high-end industrial gathering, efficient and timely supervision, complete financial services, standard law environment, outstanding effect of radiation, building an international logistics hubs and port highlands to serve the Belt and Road and the Yangtze River Economic Belt, promoting the construction of a new pattern of all-round opening in the western region, and driving the implementation of Western Development strategy.
• Building a legalized, international and convenient investment environment
• Expanding the open-up investment areas
• Promote trade transformation and upgrading
• Deepen the open-up and innovation in the financial sector
• Promote the joint development of “ the Belt and Road” and the Yangtze River Economic Belt
• Promote the coordinated development of the Yangtze River Economic Belt and Chengdu-Chongqing City Cluster
Achievements of China (Chongqing) Pilot Free Trade Zone
Chongqing will act as a significant drive in boosting the development of China’s western region. The comprehensive service functions of the China Railway Express to Europe from Chongqing have been expanded. According to Chongqing Customs, the first half of 2019 saw rapid improvement in the quantity and quality of China Railway Express (Chongqing): 851 trains and 75,400 TEUs of goods marked a year-on-year growth of 118.2% and 133.8% respectively. Given that, China Railway Express (Chongqing) kept up rapid development—doubled dispatched trains—in 2018, and the value of imported goods and other data took the lead in China. Since 2018, the actual load rate topped 90%, the goal of 2019 is to reach 100%.
As for institutional innovation, Chongqing FTZ is actively establishing a “three-step” approach to explore the new rules for land trade, instructing and encouraging commercial banks to focus on financial services and product innovation based on waybill in land-borne business.
The world’s first cross-border railway intermodal lading bill and international documentary letter of credit has been issued, which means essential progress on the exploration of international land trade rules.
Chongqing Customs also carried out Combined Inspection of Same Series to facilitate customs clearance. Specifically, non-modified motor vehicles with 3C (China Compulsory Certification) certificate, which are imported through the same train by the same consigner, enjoy the same size and model number and are produced under the same condition, can be regarded as the same series of goods and receive a combined inspection. The measure reduces the time needed for vehicle customs clearance by over one third.
When it comes to financial liberalization, Chongqing FTZ took the lead in launching innovative pilot projects in logistics financing and introducing new financing products for international land trade supply chain, optimizing cross-border revenue and expenditure management, improving cross-border settlement efficiency, saving more than 70% of the human and financing costs of enterprises.
In the third batch of free trade pilot zones, Chongqing FTZ took the lead in building the regional identification system, formally operating the large data supervision information platform and comprehensively improving the credit information system. A commercial arbitration court and an intellectual property court were approved to set up, providing mediation, notarization, foreign-related legal services. Chongqing FTZ also set up the sole trademark examination and cooperation center only in western China.
CFTZ is home to 10,164 new registered enterprises (including branches) settled in CFTZ in the first three quarters of 2019, accounting for 10.4% of the city’s total, according to Chongqing Municipal Commerce Commission on October 31, 2019. The total registered capital of new enterprises in CFTZ exceeded RMB 170 billion, accounting for 31.1% of the city’s total. Among them, 122 foreign-funded enterprises are 19.1% of the city’s total, with the registered capital of USD 282 million, 8.8% of the city’s total registered capital. CFTZ has introduced 708 projects, with the signed contracts involving nearly RMB 153 billion.
(Source mainly from Chongqing Association of Enterprises with Foreign Investment)