Two Hong Kong-listed companies have shown interest in the development of the Dagang Port in the city of Zhenjiang, East China's Jiangsu Province, said visiting officials yesterday.

COSCO Pacific, a leading container-related conglomerate, is in talks with the municipal government with a view to investing in the project, said Ling Su, director of the city's foreign trade and economic co-operation bureau.

Shanghai Industrial, a red-chip conglomerate, is also interested in the project, Yang Guoxian, an official from Zhenjiang New Area of the city, told reporters.

The city, which sits along the waterways of the Yangtze River, between Shanghai and Nanjing, capital of wealthy Jiangsu Province, enjoys convenient transportation.

With a total investment of US$120 million, the third phase of the Dagang Port will have four berths for 30,000- to 70,000-ton vessels, including a container berth, and a 100,000-square-metre warehouse, said Chen Jianshe, deputy mayor of Zhenjiang.

He led a delegation to Hong Kong for a promotion for the city to attract overseas investment yesterday.

After completion, the third phase alone would have a full handling capacity of four million tons throughput, Chen said.

The project was approved by the central government and will begin construction by the end of this year, he added.

"The government is quite open in the project that allows overseas investors to run the project solely or through joint venture, but the companies we have contacted prefer the way of forming joint ventures," said Yang.

However, the government has not decided the partner for final co-operation so far, the officials said.

Apart from the port project, Shanghai Industrial is also talking with Zhenjiang New Area with a view to making it the sole water provider to the area, said Yang.

The city has introduced 86 key projects to investors in Hong Kong ranging from manufacturing, services and agriculture to infrastructure.

Zhenjiang, with an area of 3,843 square kilometres and a population of 2.9 million, is located in the booming Yangtze River Delta area, which has grown into a strong competitor to the Pearl River Delta area, a thriving manufacturing base hosting tens of thousands of companies moving from neighbouring Hong Kong over the past two decades.

Overseas capital, especially from Taiwan, is moving from the Pearl River Delta to Yangtze River Delta because the latter proved itself more efficient, boasts more preferential policies, and has more qualified yet cheaper labourers, and most importantly, it provides a bigger domestic market.

More than 1,000 Hong Kong-funded companies were set up in Zhenjiang with a total investment of US$1.4 billion, according to the official statistics.

The city's per capita gross domestic product (GDP) is expected to reach US$3,000 this year, said the deputy mayor.

In the next five years, the city aims to achieve a growth of no less than 14 per cent, or no less than 10 billion yuan (US$1.28 billion) increase, in GDP annually, he added.

(HK Edition 09/27/2003 page7)