Beijing will invest 10 billion yuan (US$1.2 billion) in the next five years to upgrade Financial Street, a downtown financial centre where many domestic financial institutions and government agencies are located.

A worker fixing flags of a commercial building on Financial Street in Beijing. The capital will invest 10 billion yuan (US$1.2 billion) in the next five years to upgrade Financial Street, a downtown financial centre where many domestic financial institutions and government agencies are located. [CNS]

The project aims to upgrade the area's infrastructure facilities and make it more appealing to international financial groups, said Liu Shichun, general manager of Financial Street Holding Co Ltd.

Expected to be built are a five-star hotel, an international convention centre, an international school and apartment buildings for foreign investors, Liu said at a forum organized by his company on Tuesday in Beijing.

Liu's plan is to turn Financial Street into the Wall Street of China. He said by the year 2005, an international financial section occupying 1.5 square kilometres would take initial shape. All the construction projects, with estimated investments of 10 billion yuan (US$1.2 billion), should be finished by 2008, when Beijing will hold the Olympics.

First constructed a decade ago, Financial Street, located at Fuxingmen and close to the commercial centre of Xidan and the busy Chang'an street, is now home to 530 enterprises and government institutions, which control 13 trillion yuan (US$157 billion) of assets.

The securities and insurance regulatory bodies, nine domestic banks and four telecommunication groups chose to have their headquarters there. The daily fund settlement in the area exceeds 10 billion yuan (US$1.2 billion).

The development of Financial Street requires right positioning, said Qiu Zhaoxiang, head of the Financial Research Institute of the University of International Business and Economics.

He said a special panel should be established to study the development strategy. And local government should take measures to boost Beijing's co-operation with Hong Kong, which has a thriving financial centre.

Presently, many foreign companies have set up offices in the eastern part of Chang'an Street, which is building a Central Business District and already holds big office towers like the International Trade Centre and many good hotels.

To attract more foreign institutions westward in Financial Street, the Xicheng District Government of Beijing has designed a series of incentives, including favourable rentals.

For example, foreign companies which plan to set up their regional headquarters in the area will get 1,000 yuan (US$120) of rental subsidy per square metre from the district government, according to Sui Zhenjiang, vice-director of the Xicheng District Government.

And as much as 10,000 square metres of office rental space will be reserved for foreign financial institutions. Those who book the units in advance can get varying rental discounts in the first three years.

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