An aerial drone photo shows a view of mangrove wetlands in Futian of Shenzhen, South China's Guangdong province, Nov 29, 2024. (Photo/Xinhua)

In a bid to further solidify its position as China's economic powerhouse, Shenzhen, the tech-hub in the southern province of Guangdong, unveiled a series of enticing incentives aimed at attracting foreign investment and encouraging local enterprises to expand their international footprint on March 12.

The new policy package, detailed in a recent municipal government document jointly released by the city's commerce bureau and investment promotion bureau, offers a range of financial rewards, tax breaks and support programs designed to lure multinational corporations and foster a more outward-oriented business environment.

At the heart of the initiative lies a concerted effort to incentivize foreign investment. Foreign-invested enterprises that inject significant capital into the city will be handsomely rewarded. Those with annual "newly added actual foreign investment" exceeding $50 million in 2023 and 2024 can expect incentives ranging from 1 percent to 3 percent of the investment amount, depending on the industry sector with an upper limit of 50 million yuan ($6.9 million). "Newly added actual foreign investment" refers to the net increase in foreign capital that has been put to practical use within a particular area during a defined period.

Moreover, Shenzhen is extending a warm welcome to multinational corporations looking to establish regional headquarters. Qualified companies that meet the investment threshold of $10 million annually over the two-year period will receive a one-time reward of 5 million yuan.

In 2024, Shenzhen saw the establishment of 9,738 new foreign-invested enterprises, a 21.7 percent increase, making it rank first among all cities in the Chinese mainland.

"To further optimize Shenzhen's market-oriented, law-based and internationalized business environment, we have outlined four key areas," Ye Wenge, deputy director of Shenzhen's commerce bureau,shared.

"The four key pillars are: first, we will make Shenzhen the 'top choice for global investment', actively encouraging more foreign companies to establish a presence here. Second, we will build a 'global capital integration hub', attracting international financial capital and streamlining the flow of funds into and out of our city. Third, we will create an open and innovative tech environment, drawing in leading research institutions and the top talent from around the globe. And fourth, we will significantly boost our appeal to international talent, making Shenzhen an even more attractive place for foreigners to live and work," Ye added.

Beyond attracting foreign capital, Shenzhen is also actively encouraging local enterprises to venture onto the global stage. The city is providing substantial support for companies undertaking overseas construction projects, offering rewards based on their completed business turnover.

Companies undertaking overseas construction projects can receive cash rewards based on their project earnings, up to 2 million yuan, to encourage the export of goods and services. Additionally, businesses investing or partnering abroad can receive subsidies covering 50 percent of various expenses, including legal, financial and insurance costs, up to a maximum of 20 million yuan, to reduce the financial burden of global expansion.

Yu Qiang, a professor at Beijing Technology and Business University said: "By attracting high-value investments in strategic sectors like technology, manufacturing and advanced services, Shenzhen is becoming a global hub for multinational companies, offering them a strategic foothold in the dynamic Chinese market.

"Foreign companies investing in the city create jobs and new technologies, while their entry into China helps them find new customers and get better at what they do. All these things boost the economy, make companies more competitive, stronger and ultimately more successful," Yu added.