More than 60 Zhejiang high and new technology companies are qualified to list on the country's second board, according to the coastal province's senior technology official.

And more than 40 companies had started preparatory work for a possible listing, Zhejiang Science and Technology Department chief Mao Guanglie said.

The Shenzhen Stock Exchange last week published provisional regulations for governing listing and trading on China's second board, or innovation market, in preparation for its launch in the special economic zone in the coming months.

Mr Mao said that the second board would provide provincial high-technology start-ups with an important avenue for funding.

He said the government was working with prospective second-board candidates by offering training in the new market's regulations, and by making introductions with interested investment banks and other potential listing sponsors.

Not unlike other provinces and independent municipalities, the Zhejiang government in its 10th five-year plan has identified high- and new-technology industrial development as crucial to the province's future economic well-being.

The government is calling for hi-tech production to account for more than 25 per cent of the province's industrial added-value output by 2005.

That would be a sharp rise from last year's contribution of 15 per cent, or 78 billion yuan (about HK$73.07 billion).

Much of the province's attention has centred on the State Council-designated Hangzhou High Technology Zone (HHTZ), a self-styled Silicon Valley.

The zone is to serve as a base for development of biomedicines, telecommunications and software industries.

It is now home to 613 enterprises, including more than 100 software producers, which last year reported business sales of 12.8 billion yuan.

HHTZ administration chief Wu Yipeng said the zone was projecting to raise revenue seven-fold to 85 billion yuan by 2005.

Zhejiang was better prepared than other provinces to develop a native hi-tech capability, Mr Mao said, primarily because of the province's vigorous private economy.

At the end of last year, Zhejiang claimed 1.64 million self-employed and privately established businesses, including 146,400 private companies.

They employed a total of 4.73 million people and accounted for about one-half the value of the province's industrial production.

Mr Mao said he expected the province's non-government hi-tech start-ups would display the same kind of sensitivity to markets, return on investment and government policies that they demonstrated in their earlier manufacturing activities.

These companies had been tested and proven by competition, he said.

Mr Yipeng said he believed the province held other advantages, including a comparatively healthier living environment and access to trained personnel and advanced technology, as well as a more predictable legal environment.

(South China Morning Post)