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Doing Business in beijing

I . Survey

(i) Geography

The urban area of Beijing, located at 39��N and 116 ��E , is bound by the mountains to the west, north and north-east and opens to the North China Plain, which falls away to the Bohai Sea in the east. The altitude of the plain Beijing lies on ranges from 20m to 60m, while the mountains average from 1,000m to 1,500m in hight. Mount Dongling, on the border with Heibei Province, is the municipality's highest point, with an altitude of 2,303 m. The major rivers flowing through the municipality are the Chaobai River and Beiyun River in the east and Yongding River and Juma River in the west. The urban areas of the city are divided into Dongcheng, Xicheng, Chongwen, Xuanwu, Chaoyang, Haidian, Fengtai and Shijingshan districts, and the rural areas are comprised of Mentougou, Fangshan, Tongzhou, Shunyi, Changping, Daxing, Pinggu and Huairou districts and Miyun and Yangqing counties. The municipality covers an area of 16,410.54 km2 with an urban area of 1,368.32 km2 and a rural area of 15,042.22 km2.

(ii) Climate

The city is of temperate continental climate, characterized by hot, humid summers, cold, dry winters and short springs and autumns. The average annual temperature is 10 to 12�� with a lowest and highest recorded temperature of -27.4�� and 42�� respectively. The city is one of the rainiest regions in the northern part of China with an annual precipitation of over 600 mm, 75% of which falls in the summer months.

(iii) Population and Nationalities

The population of Beijing Municipality, defined as the total number of people who reside in the city for six or more months of the year, was 15.38 million in 2005. Of these, 11.870 million had a Bei jing permanent residence certificate. Among those with permanent residence status, 3.005 million worked in the agricultural sector. The density of the population is 937.2 per square km. Religions practiced by residents include Buddhism, Taoism, Islam and Christianity. Among the 56 ethnic groups in the city, those numbering over 10,000 include Hui, Manchu and Mongolian; those numbering over 1,000 include Zhuang, Uygur, Tujia and Tibetan.

(iv) Transportation and Infrastructure


Beijing is a significant transportation hub in China.

The streets of Beijing are laid out like a chessboard. The Second, Third, Fourth and Fifth ring roads, connecting with many other main routes, constitute a complete urban roads system. There are 12 National Highways and nine expressways radiating from Beijing in all directions. In 2005, the subway line in Beijing reached 114km. Construction of the No.5, No.10 first stage (including the Olympic link) and the No.4 subway lines and an express rail link to the airport is well under way. Total road length in the municipality is 4,696 km, with 548 km of expressways. By 2005, on 14,713 km of roads in Beijing, 300.5 million tons of cargo and 519.25 million passengers are transported accounting for 92.4% and 85.3% of the total respectively.

Beijing is a railway hub of the People's Republic of China. There are several major railways radiating out from Beijing, including those to Guangzhou, Hong Kong, Shanghai, Baotou (in Inner Mongolia) and Qinhuangdao (in Hebei). China's rail network covers 30 provinces, municipalities and autonomous regions as well as Hong Kong Special Administrative Region. By 2005, Beijing's railway transportation lines were 964.4 km long with a cargo transportation capacity of 197.62 tons, accounting for 6.1% of the total and passenger transportation capacity of 57.78 million, constituting 9.5% of the total.

Beijing Capital International Airport is the busiest of China's international airports. Its network covers all China's provinces, municipalities, autonomous regions, Hong Kong and Macau, as well as 54 cities in 39 countries around the world. In 2005, the total amount of air cargo into and out of Beijing Capital International Airport reached 769,000 tons. Air passenger transportation amounted to 31.36 million passengers, constituting 5.2% of the total.

Post and telecommunications

The postal services to and from all countries and regions around the world are available in Beijing. The telephone network connects 2,300 domestic cities and 260 foreign countries and regions. In 2005, the total revenue of post and telecommunication services reached 41.75 billion yuan with 3.35 billion yuan from post services and 38.4 billion yuan from telecommunication services.The number of subscribers amounted to 9.5million, among those 8.545 million were in urban areas and 0.955 million were in rural areas. Cell phone users reached 147 million in Beijing, which means that 97 out every 100 people own a cell phone.

Finance and insurance

The financial industryp lays a significant role in Beijing's economy. In 2005, the financial assets in Beijing totaled 14.1 trillion yuan, with an added value of 79.28 billion yuan in the financial sector. Under a relatively sound financial organization system, branches of financial institutions in the banking system amounted to 161, insurance companies totaled 44 and intermediary agencies specializing in insurance reached 227.

Substantial progress has been achieved in the opening up of the financial sector in Beijing. Since RMB business was opened to foreign funded banks on 1st of December, 2004, 10 foreign funded banks have officially launched RMB services. By 2005, altogether 25 branches, four sub-branches, 78 agencies of foreign funded banks and 17 solely-foreign funded and joint stock insurance companies have been established in Beijing.

Main Financial and Insurance Organizations in Beijing

(v) Foreign Exchange

Beijing has increasingly s t r e n g t h e n e d e x c h a n g e s with other countries and regions all over the world in economy, trade, science and technology, education, culture and other fields. Governments, communities and social organizations conduct active cooperation. Currently, Beijing maintains partnerships with 38 cities of 34 countries around the world. There are 137 foreign embassies, 17 international organizations and local agencies and 190 foreign news agencies in Beijing. Foreign agencies in Beijing number over 7,000 and there are over 17,000 foreign students.

The major cities maintaining partnerships with Beijing are as follows:


Beijing's exhibition industry is of great importance for the whole country. The major exhibition centers include: Beijing International Convention Center, China International Science and Technology Convention Center, China International Exhibition Center, China National Agricultural Exhibition Center, Beijing Exhibition center, China International Trade Exhibition Center. In 2005, the area of hotel rooms and boardrooms of these venues in Beijing reached 621,000 m2 and the exhibition halls, 204,000 m2. Nearly 7,000 international conferences were held with a total revenue of 320 million yuan. In addition, 322 international exhibitions were held in Beijing in 2005.

(Vi) Scientific Research and


Scientifi c Research

Beijing is the largest base for scientific and technological research in China, with the Chinese Academy of Science and other scientific research institution and Zhongguancun Scientific Park, which is known as China's Silicon Valley, of which achievements awarded by the central authorities account for one-third of the total every year. By 2005, there were 7,400 organizations and institutions involved in scientific activities with 340,000 professionals, with a total of 38 billion yuan allocated for research and experiments in Beijing.


Beijing is home to a large number of higher education institutions and welleducated people. There is a total of 79 higher education institutions in Beijing, including Peking University, Tsinghua University, Renmin University of China and Beijing Normal University. In the year 2005, there were 117,000 graduates, 156,000 new students, 537,000 in-school students, 113,000 faculties and other personnel and a floor space of 25.985 million m2. Higher education institutions qualified to recruit graduate students totaled 51 with 31,000 graduates, 52,000 new students and 142 thousand in-school students. There are 24 libraries in Beijing, including the largest one in Asia and there are also over a hundred museums in Beijing.

(vii)Tourism and Special

Local Products

Beijing boasts abundant tourism resources with more than 200 tourism sites open to the public, including Tiananmen Square, Beijing Ancient Observatory, the Workers' Cultural Palace, the Imperial Palaces of the Ming and Qing Dynasties (the Forbidden City), the Lama Temple, Zhongshan Park, Shichahai, Beihai Park, Miaoying Temple, Prince Gong Mansion, Jingshan Park, Taoranting Park, the Temple of Heaven, the Fragrant Hills, the Summer Palace, the Ruins of the Old Summer Palace, Zizhuyuan Park, the Temple of the Sun, Lugou Bridge (Marco Polo Bridge), Mount Ling, Mount Miaofeng, Tanzhe Temple, the Imperial Tombs of the Ming Dynasty, Badachu Park, Badaling Great Wall, Shidu and the Peking Man Site at Zhoukoudian.

II . Economy

(i) GDP

In 2005, Beijing's GDP totaled 688.63 billion yuan and per capita GDP reached 45,444 yuan. The added value of primary industry came to 9.8 billion, secondary industry of 202.65 billion yuan and tertiary industry of 476.18 billion yuan.

(ii) Resources, Agriculture and Industry

Natural Resources

Beijing boasts a favorable condition for mineral resources. Other capitals around the world seldom enjoy this kind of advantage. It also stands out from other major cities in China for its large amount of proven reserves of a variety of ores. Currently, 126 kinds of minerals have been found in Beijing. The reserves of 68 kinds are verified and 363 mines have been set up. Among the mines of verified reserves, the large-scale mines total 30, accounting for 8.6%, medium-scale total 106, accounting for 30.6%, small-scale total 96, accounting for 27.6% and miniscale total 115, accounting for 33.2%. The major minerals include coal, iron ore, gold, molybdenum, limestone for cement, marble, diopside and sand for construction etc.

Ground water is among the most important resources in Beijing. The ground water replenishment is 3.95 billion m3/a and the yield totals 2.63 billion m3/a. The yield in the plain reaches 2.46 billion m3/a. Ground water accounts for two-thirds of the city's water supply, with more than 150 water sources for Beijing's urban areas, rural areas, satellite towns, large-scale mines and various organizations and institutions. After the middle section of the South-North Water Transfer Project is launched in Beijing, ground water will account for half of the city's water supply.

Beijing enjoys abundant terrestrial heat resources. Preliminary data demonstrate that areas with terrestrial heat cover 2,372 km2, constituting 14.1% of the total area of Beijing. The quantity of heat in the reserve layer is equal to that produced by 11 billion tons of standard coal. The total reserve of terrestrial heat reached 18.12 billion m3, out of which 110 million m3 are to be explored every year, equal to the quantity of heat produced by 649,000 tons of standard coal.


In 2005, the output value of the service industry in farming, forestry, animal husbandry and fishery in Beijing totaled 26.88 billion yuan, with farming contributing 10.06 billion yuan, forestry of 1.33 billion yuan, animal husbandry of 13.57 billion yuan, fishery of 970 million yuan and services for the above four sectors of 950 million yuan.


In 2005, the major industrial enterprises in Beijing realized an added value of 170.54 billion yuan and export products of 106.53 billion yuan. High-tech industries achieved an added value of 51.75 billion yuan, accounting for 30.3% of the total in Beijing.

Output of Major Industrial Products of Beijing

(iii)Commercial Data

Foreign Trade

In 2005, Beijing's cargo trade volume reached $125.57 billion, with an export volume of $30.87 billion and import volume of $94.7 billion. The export volume of mechanical and electrical products totaled $15.63 billion, accounting for 50.5% of the region. That of high-tech products came to $9.74 billion, accounting for 31.5% of the region. According to Balance of Payments, service trade volume reached $29.16 billion, with revenue of $18.2 billion and expenditure of $10.96 billion.

Beijing's Cargo Trade

Service Trade Revenue and Expenditure

Utilization of Foreign Funds

By 2005, 126 countries and regions had investments in Beijing. Among them, Hong Kong established 8,176 foreign funded enterprises with FDI reaching $15.29 billion, accounting for 30.6% of the total contracted foreign fund; British Virgin Islands, 1,296 enterprises with FDI amounting to $5.87 billion, constituting 11.8% of the total; Japan, 2,032 enterprises with FDI $5.57 billion, accounting for 11.2%; United States, 4,004 enterprises with FDI $4.79 billion accounting for 9.6%; Germany, 378 enterprises with FDI $2.44 billion accounting for 4.9%; Korea, 1,729 enterprises with FDI $2.44 billion accounting for 4.5%; Cayman Islands, 351 enterprises with FDI $2.03 billion accounting for 4.1%.

Actually Utilized FDI in Beijing

Foreign Economic Cooperation

In 2005, Beijing's contracted projects and labor service cooperation with foreign countries realized a turnover of $712.81 million with contracted capital of newly signed contracts amounting to $937.32 million. 3,473 laborers were sent abroad and people working in foreign countries numbered 4,796. Major projects exceeding $10 million amounted to 17 with total contracted capital reaching $380 million.

Contracted Projects and Labor Service Cooperation in Beijing

In 2005, five enterprises in Beijing were responsible for 49 foreign aid projects including six engineering foreign aid projects with a total contractual value of $6.96 million, 16 goods foreign aid projects, 14 design, consultancy and engineering supervision projects and 13 other projects. Countries receiving aid include Mauritius, Tonga, Togo, Guinea-Bissau, Antigua, Mauritania and Afghanistan etc.

In 2005, the Beijing municipal government approved 51 foreign enterprises and institutions including 19 foreign institutions and 32 foreign enterprises. Total value of investment in foreign countries amounted to $204.4375 million with contracted investment value on China's part reaching $204.0514 million, accounting for 99.81% of the total. There are eight American projects with investment in trade, tourism, electronics, computer software, Internet and other fields.