Helen Deng

In a press conference after the conclusion of the annual session of the Shenzhen Municipal People's Congress yesterday, Mayor Xu Zongheng met reporters and addressed questions over topics ranging from housing prices to migrant workers' rights and the tax reform.

Reporter (Q): According to figures from the statistics bureau, the average price of new houses in Shenzhen rose 9.9 percent in February. Who do you think has a bigger say in the housing market, the mayor or the market?

Xu Zongheng (A): Shenzhen's housing prices started to jump since October 2005. But after we implemented national and local macro-control measures last year, the price rise has slowed down.

In the first two months of this year, the housing price rose about 10 percent from the same period in 2006. I think that was too fast. There is still room for price control.

Generally speaking, housing prices are decided by the demand and supply in the market. But at certain stages, it is the government's responsibility to guide and control the market.

To ensure the healthy growth of the real estate market, the government will do the following this year: Firstly, we will supply more land for real estate development. About 8 million square meters of new apartments will enter the market, which is expected to satisfy the demand. Secondly, we will optimize the structure of housing supply and pay special attention to the poor. Thirdly, we will levy taxes more strictly and enhance market supervision. With all these measures, I believe the real estate market will grow in a healthy and rational way.

Shenzhen is short of land. We will strictly carry out the Central Government's guideline that 70 percent of all new apartments should be under 90 square meters. I hope the residents understand that.

Q: Shenzhen has been rated "the most popular city among migrant workers." However, some say there are still sweatshops in the city. What measures will you take to protect the rights of migrant workers?

A: Migrant workers have always been an important force in Shenzhen's development. I'd like to take this chance to extend my sincere gratitude to migrant workers.

"The most popular city among migrant workers" is a fair description of Shenzhen. Shenzhen has implemented many measures to improve the welfare of the migrant workers.

We grant equal job opportunities to both locals and migrants. We have been raising the minimum wage continuously. We have built a social insurance scheme for migrant workers. At the end of 2006, the medical insurance has covered 3.48 million migrant workers. In one or two years, all migrant workers will be covered by the medical insurance scheme, which covers medical fees of up to 330,000 yuan (US$42,307.69) for a premium of only four yuan a month.

We have taken measures to deal with back wages. We have built canteens in industrial zones to provide cheap and safe food to migrant workers. Migrants are among the legislators and political advisers.

Q: The number of automobiles in Shenzhen has surpassed 1 million. Will the city government adopt any measures, such as charging motorists for entering downtown, to ease congestion?

A: I noticed that many Western cities charge fees for automobiles entering the city center, which effectively eases congestion. We studied the possibility years ago. If the number of automobiles continues to grow at the current speed, we may restrict the use of cars citywide. But unless particular things happen, we will not adopt the measure.

We have been pushing ahead with the construction of subways and rapid transit systems. By 2011, the city's Metro lines will extend 177 kilometers, twice as long as in Hong Kong.

Q: Many people complain about the high bus fares in Shenzhen. If you want to encourage people to use the public transport, will you lower the bus fare?

I have mentioned in my work report that the bus fares will be lowered.

The bus fares are decided by bus companies that set the fare according to a ceiling set by the government. We are doing research on whether the current ceiling is reasonable.

We are also improving the bus network to reduce the need to transfer buses. If necessary, we will increase subsidies to bus companies.

Vice Mayor Zhang Siping has promised to make public transportation easier and cheaper within this year, and I firmly support him.

Q: You were elected Shenzhen mayor three years ago, how do you assess your own work?

When I was elected Shenzhen Mayor on June 2, 2005, I said: "I feel as if I was on thin ice." I feared that I was not capable enough. Three years later, I'm more confident.

After I was elected, I set three principles for myself: "be clean, caring the people, and be diligent." In retrospect, I'd like to add one more principle:" be thinking," — think about the strategic issues concerning the city's development.

Q: Chief executive of the Hong Kong Special Administrative Region Donald Tsang said Hong Kong and Shenzhen should build a strategic partnership and jointly build a world-class metropolis. You once said Shenzhen would "learn from Hong Kong and serve Hong Kong." How do you respond to his words?

A: I feel very happy about his words and totally agree with him. I hope the two cities can achieve the aim hand-in-hand.

The 10 years following Hong Kong's return to the motherland have seen increasingly close ties between Shenzhen and Hong Kong. There is a growing desire for communication between the two cities too.

In the future, I think the cooperation between Shenzhen and Hong Kong will have the following features: First, we will learn more from Hong Kong's experience in city management. In the past we put more emphasis on building infrastructure facilities to connect the two cities. Second, our cooperation will go deeper. We will cooperate in high-end sectors like financial services and building a Shenzhen-Hong Kong innovation circle. Third, the cooperation will expand from the project-level to a strategic level. Fourth, the government will be more involved in seeking all-round and high-level cooperation.

Q: Security is a concern for both Shenzheners and visitors. What will you do to make people feel safe here?

Shenzhen's public security is improving gradually. Since 2003 we recruited 8,000 policemen. Last year alone, we recruited 2,600 policemen. I can say the special economic zone (SEZ) is as safe as other major mainland cities. The public security outside the SEZ is becoming better, too.

However, Shenzhen has its own difficulties in maintaining public security. Shenzhen has the biggest land port in the world, and it has a huge migrant population. To realize the aim of "remarkably improving the public security," which was raised in my 2005 work report, we still need to make lots of efforts.

Q: Many people miss the blue sky and the white clouds Shenzhen used to have. Are you satisfied with Shenzhen's air? Can Shenzhen still see those days?

A: I miss the good old days with blue sky and white clouds too.

Shenzhen's air pollution comes from the emissions of automobiles, power plants that burn coal or oil, and other cities in the Pearl River Delta.

To reduce pollution, we have started to desulfurize the exhaust from coal-burning power plants and change gasoline for LPG at power plants. New measures will be taken to rein in the growth of automobiles. Starting from April, the Euro III standard on exhaust will be applied citywide. We will also join hands with Hong Kong and other Pearl River Delta cities to deal with pollution.

Shenzhen will invest 30 billion yuan on environmental protection by 2010. With the new measures being implemented, there will be more days of blue skies and white clouds in Shenzhen.

Q: Many students have to pay extra fees to enter a good school. What is the reason for charging the "school-choosing fee?" Have you considered scrapping the fee?

A: Charging "school-choosing fees" at high schools is permitted by the provincial government. The fees are charged because there are not enough quality high schools in the city.

We will provide 8,000 extra high school seats this year, part of our efforts to solve the shortage. I hope that in the next two to three years, the problem can be solved completely.

I hope you understand that "school-choosing fee" is a historical problem that occurs when education resources are insufficient. But the fee will be scraped eventually.

Q: How will the tax reform influence Shenzhen?

A: The tax reform that was passed by the recent national people's congress means that Shenzhen no longer enjoys any preferential policies.

Raising tax from 15 percent to 25 percent will increase the companies' burden and affect their competitiveness, although the tax revenue will increase. But looking at the issue in the other way, the tax reform will help Shenzhen develop a high-tech industry and a recycling economy.

Preferential policies are not the only reason behind Shenzhen's success. The most important reasons for Shenzhen's growth are reform, innovation and opening-up.

Shenzhen's three major strengths will remain after the tax reform: its proximity to Hong Kong, its market economy framework and its innovation.

The government will continue to grant tax breaks to high-tech companies. Shenzhen's high-tech industry contributes to 52 percent of the total industrial revenue in the city.