(Photo by Baycrest - Wikipedia user ("CC-BY-SA-2.5") : Line 6 Platform of South Waigaoqiao Free Trade Zone Station, Shanghai Metro)

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According to a report a Chinese Ministry of Commerce said that this establishment is the first of its kind in Mainland China and the central cabinet has officially permitted this making way for the multi-billion venture, ferociously pushed by economist Premier Li Keqiang to be executed soon.

The success of this venture has a greater implication for China as it is going towards building similar trade zones in different countries like Uttar Pradesh, India aside from an economic hallway linking China to Pakistan.

As always, China launches economic enterprises on trials in chosen areas before expanding them to various areas.

 Li Keqiang,  had thrust this plan hard more than ruling opposition to such a hub in Shanghai, China's largest city aside from being its main financial hub.

In addition, hesitations arise when thinking that it could create a serious competition to Hong Kong which practically serves as the free trade zone hub displaying few restrictions.

An argument within the government is focused on plans on how to aid China's economy who has a GDP now of roughly 7.5 percent with a wild guess to decrease to seven this year.

According to interviews of Economic Times to government officials, they claim that achieving a 7.5 percent GDP this year may be hard considering the domestic and global hold up.

Director Zhou Yu of the Research Center of International Finance at the Shanghai Academy of Social Sciences told the Global Times that the launching of the free trade zone hub could smooth the progress of liberalization of yuan capital accounts.

He also added that the major reason for the free trade zone hub in Shanghai is to discover new trail and representation for China to open up, to optimize economic structure, to push reforms of the administrative system and the swiftness of the makeover of government functions and to promote the means for economic development.

However, the Chinese government and many Chinese Businessmen hopes for this free trade zone hub to positively work. And if so happens, expect a great increase in China's economy sooner or later.

Tagsfree trade zone