Online Extra: Suzhou Wants Your Business

This small Chinese city has worked hard to attract and hold foreign investment by easing red-tape and providing lots of Western amenities

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August 21, 2006 at 4:00 AM UTC

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Not so long ago, Suzhou was known as a sleepy city of gardens, temples, and canals. A favorite on the tourist circuit, it was basically a business backwater. But over the past decade Nokia (NOK ), Samsung, Philips(PHG ), Dupont (DD ), Emerson, Honeywell International (HON ), 3M (MMM ), Bosch, and Delphi (DPHIQ ) have poured billions of dollars into Suzhou, making it one of China's most popular investment destinations and an emerging competitor to Shanghai, Shenzhen, and Beijing.

A confluence of geography—it's close to Shanghai, but land and labor are cheaper by 20% to 30%—well-developed infrastructure, pleasant location and climate, plus an extremely pro-business local government, have all conspired to make Suzhou a raging success. "The major criticism of China—you could come here and it was cheap, but it was always a pain to get things done—Suzhou shows it doesn't have to be that way," says Kent D. Kedl, executive director of Technomic Asia, a Shanghai business consultancy for investors coming to the mainland.