Tianjin has been following its Transformation and Upgrade Action Plan since early 2014 with the idea of applying its 120,000 small and mid-sized enterprises (SMEs) within three years from that date as a major way to push economic growth, promote innovation in science, increase employment, and improve people’s livelihood,

And it has grown extensively in these areas in those years but, at the same time, it has been constrained by its lack of industrial clusters, low value–added output, low profits overall, overcapacity and environmental pollution. The specific goals of the action plan were to raise total corporate profits by 50 percent, increase of industrial park tax revenues per hectare by 50 percent and reduce energy consumption per unit of added value by 15 percent.

To accomplish this, the city has asked enterprises to invest more in innovation, apply technology to production, and build R&D centers to increase innovative ability. It is helping its traditional manufacturers to move higher up on the value chain and get into strategic emerging industries, such as, new generation information technology, bio--medicines, energy conservation, and environmental protection, or into modern service industries such as logistics, software outsourcing, and culture. It is also looking for more enterprises in industrial parks to build e-commerce clusters, new energy, new materials, and software design.

Tianjin had 12,239 enterprises with upgrades by the end of 2015, after completing thousands of transformation projects, brining per-unit energy consumption down by 2.88 percent, labor productivity up 20.6 percent, and total pre-tax profits up by an impressive 45 percent compared with 2013, and completing the task a year ahead of schedule.

This year, Tianjin started a new program to improve its enterprises more through new improvement policies and new ways to increase interactions between enterprises and governments at all levels. In this, some of its districts and nearby counties and villages have shown great enthusiasm and have gone all-out in the transformation of local enterprises, and in service-oriented and green market entities.