Along the shores of the Yangtze River, the wind blows a full sail. As reforms surge on, currents of dynamism vibrate.

On August 30, 2019, China (Jiangsu) Pilot Free Trade Zone Nanjing Area (hereinafter referred to as “the Nanjing Area”) was approved for establishment, thus unveiling the curtain for a national experiment of institutional innovation. Over the past two years or so, the Nanjing Area has set the pace for pioneering as it functions both as a pilot free trade zone and a national new area. Along the stretch of 39.55 km², it has implemented over 95% of all major reform tasks, with over 100 outcomes of institutional innovation applied province-wide and to the entire nation once they were first experimented in this area.

Daring for Trial and Error—Stimulate vitality in institutional innovation

Genie pigs are the primary tools for drug development and pre-clinical efficacy tests as they share highly identical genome with human beings. Importing these “white mice” used to be head-scratching for many pharmaceuticals as the procedures for import were complicated and the quarantine took a long time. With the new “Custom Facilitation Portfolio for Imported SPF Laboratory Mouse” in place, the approval and quarantine were both shortened when businesses apply for importing these mice for the research and development of certain drugs.

“These mice have a relatively short life span, narrowing the quarantine to 14 days from the previous 30 saved us time for research”, said Yang Huixin, director of production at GemPharmatech.

Over the two years, the Nanjing Area has pioneered in institutional opening-up by using differentiated approaches, oriented by addressing issues that hinder the implementation of policies for reform and innovation.

“It took only two weeks to get the two permits after the application. We were amazed at the efficiency of the Nanjing Area”, said Zhu Daifen from Nanjing Huayitai Electronic Technology. The two permits refer to the work permit and residence permit for foreign nationals.

The Nanjing Area tried out a new model for creating ease for international professionals that is based on a tri-color (red, white, gray) credit system for employers with foreign staff. With that in place, the Nanjing Area enables to approve the permits within 10 working days in lieu of the maximum of 10+15 days as regulated by national authorities, which is also the fewest days for getting the permits within Jiangsu.

By far, Nanjing has finished 95% of key reform tasks, with 11 applied across Jiangsu and 14 referred to as good examples of the province.

The program Eco Eye for the Protection of the Yangtze River was inscribed on the fourth list Best Practices among pilot free trade zones in China. Two platforms—Platform for Central Regulation and Public Services of Bio-medicine and Platform for Trading, Financing, Services and Operation of IPRs—were enlisted in Best Practices of Pilot Programs for Innovative Development of Trade in Service.

Seek Innovation—Expand along industrial chains by strength

The book of Free and Easy Wandering described a mythical beast Kun Peng that hovers overhead. In the Nanjing Area, the new Kun Peng is ascending along the trend of digitalization—Huawei Kunpeng Center. A creation together with Huawei, it has attracted 500 resident enterprises.

As the carrier of Kunpeng Industrial Eco-system, Beilian Computing is dedicated to the R&D and manufacturing of Chinese computers. In the workshops of Jiangsu Beilian Baode Company, production lines for personal computers are humming. A child by two companies—Beilian Guoxin and Shenzhen Baode, this Jiangsu company makes computer servers of an ingenious brand. In a short span of 10 days, its first personal computer is launched after the registration completed on August 6.

“Despite tight pandemic control, our production was uninterrupted. Staff in the industrial park helped coordinate logistics and movement of people while they offered guidance to go through every step of the quarantine. With that, our entire company has 70 employees in place”, said Du Song, general manager of Jiangsu Beilian Baode Computing Systems Company. According to Du, the company has already met the annual targets of 60,000 servers and 100,000 personal computers and is likely to exceed RMB 500million in production values.

In the first half of 2021, X-Times, SYGNUS Semi, and HEPAGene were attracted to the Nanjing Area, as some of the RMB 3 billion or above projects in programs of the Chip Town and the Gene Town. The combined investments surpassed RMB 20 billion, and the industrial clusters are playing a more prominent role.

Following the trend of the Chip Town and the Gene Town, the new finance center (part of the Two Towns and One Center planning) has taken shape. 937 financial institutions have resided in (517 as funds or fund management companies), with the pledged capital approaching RMB 500 billion, as a result of promoting new financial business forms (including assets management, equity investment and fund & insurance) in building the “Two Towns”. A foundation of over RMB 5 billion for digital financing and fin-tech was established, and over 50 demonstration projects for incubation and finance were established.

Unleash Momentum—Testaments by Business Environment

81 to 5. From the previous 81 days to open a pharmacy to the current five days, the result could not be more evident. What goes on in the backdrop is the reduction of red tapes. Once there were the need of seven sets of files before receiving seven licenses, but now only one submission for one license.

Following a shift of focus from “supply by the government” to “demands of the market”, the reform of one license for one industry was first piloted in 22 industries, such as supermarkets, pharmacies and restaurants, which strongly stirred the market vitality.

In an effort to improve the business environment, the Nanjing Area has introduced 30 policies for intensifying services reforms among governments and establishing systems for precision regulations. 80 investment and trade facilitation measures have been reprinted to cover every aspect of business facilitation, including market access, administrative approval and investment facilitation.

Businesses are the primary beneficiaries of a better business environment. Thanks to these policies, Nanjing Youen, a company for international trade facilitation, was able to get the business license the same day it submitted the application.

Over the two years, the reform pilot of separating the business permit and license swept across the Nanjing Area, bringing benefits to over 13 thousand businesses and accelerating the residence of innovators. It has cumulatively incubated or introduced 1,200 enterprises, among them are two unicorns and 100 gazelle.

The practice of rule-of-law is the best business environment. At the moment, the first ever area for rule of law is taking shape fast, attracting quality resources for resolving business, maritime and environmental matters.

Create A Magnet—Accelerate Reform and Opening Up

As one of the key missions is to establish a platform for opening-up and cooperation, the Nanjing Area has generated a number of applicable practices for developing open economy, thanks to its proactive innovative explorations.

An IPR trading and financing platform launched in April this year was inscribed in the best practice list of Pilot Programs for Innovative Development of Trade in Service, as it has incorporated the block chain technologies and integrated notary, rights protection, services and financing. By far, this platform has completed over 15,000 transactions and exceeded RMB 200 million in trade volumes on top of over 200,000 digitalized patents.

As part of the focus on financing opening up and innovation, cross-border movements of capital has been smoothened. The pilot for NRA accounts has enabled the first cross-border financing for currency mismatch by the Jiangsu Pilot Free Trade Zone and the first cross-border Renminbi business.

“Kingfriend and Simcerehave launched cross-border finance operation and introduced ‘free trade chain finance’ and ‘free trade cloud services platform’ as part of the move to enable finance to serve the real sector. This facilitates the allocation and settlements of funds and effectively lowered costs for finance”, according to an official from Comprehensive Coordination Administration for Pilot Free Trade Zones of the Management Committee of Jiangbei New Area.

Last month, QFLP pilot was promoted in the Nanjing Area in an effort to create more favorable investment environment for foreign capital and promote foreign equity investment enterprises to grow in a healthy fashion. In comparison to other QFLP pilots in other cities, the one in Nanjing is more inclusive and flexible in business models for fund management, qualifications for foreign investors, the interested areas for investment and allowed fund volume. For these reasons, several fund managers have planned to apply to participate in the pilot program.

As part of the pursuit of expanding the benefits of reform to more stakeholders, the Nanjing Area has established a new work mechanism with development zones and high-tech parks at provincial or above levels in Nanjing and promoted 80 investment and trade facilitation measures to encourage businesses that fit into the idiosyncrasies of leading industries and need free trade policy support to register in the Area. As of now, over 1,600 collaborative enterprises have obtained business licenses in the Nanjing Area, with a registered capital of over RMB 7 billion.