In 2007, the Kunshan Export Processing Zone achieved steady progress in its endeavour to build itself into one of the best integrated bonded processing zones in the country. It achieved four breakthroughs in the course of its transformation and upgrade.

First, a breakthrough was made in the pilot project of developing bonded logistics functions. With State Council approval, the Kunshan export processing zone became one of the first batch of pilot export processing zones to develop bonded logistics and other functions in December 2006. A total of 13 logistics enterprises launched bonded logistics service on a pilot basis between 1 March when the project started and the end of 2007. The total value of goods entering and leaving the bonded warehouses is expected to reach US$17 billion for the whole year, including US$8.3 billion for inbound goods and US$8.7 billion for outbound goods. The income of logistics enterprises amounted to Rmb72 million. Through this pilot project, the export processing zone expanded its functions from simple bonded processing to bonded logistics, R&D, testing, maintenance and after-sale service, with income from R&D, maintenance, testing and after-sale service amounting to US$380 million.

Second, a breakthrough was made in bringing in international logistics enterprises. Kunshan stepped up its efforts to bring in international logistics enterprises through this pilot project. As many as 13 logistics enterprises moved into the processing zone in 2007, with total registered capital amounting to US$26.81 million, including US$15.23 million from foreign investors, of which US$10.38 million was already paid in. Among these foreign logistics companies was AMB, a world-famous supplier of logistics equipment. In addition to developing its own business, it will bring to Kunshan a number of world-class modern logistics companies and supply chain enterprises. Hong Kong-based Valueplus Logistics, a large logistics company with considerable business in both Hong Kong and the mainland, is cooperating with Air China Cargo and Eastern Airlines to build an extension port linking the Kunshan Export Processing Zone with Shanghai's Pudong International Airport to form an air logistics express base. Sinotrans, Crane Logistics under Shanghai Airlines, and Suzhou Customs Declaration Co are famous integrated logistics companies on the mainland. Their presence injects new vitality to the logistics business in the Kunshan Export Processing Zone.

Third, a breakthrough was made in tax revenue. After the policy of "two-year exemption and three-year reduction by half" of enterprise income tax was over, tax payable by large enterprises in the processing zone showed a significant increase. Enterprises in the processing zone paid Rmb240 million in income tax in 2007, an increase of 106% over the previous year. Tax paid by the top three taxpayers totalled Rmb140 million, up 104%.

Fourth, a breakthrough was made in the sales of electronic goods and total imports and exports. The electronic information industry saw strong growth at high levels. In 2007, the processing zone turned out over 38 million notebook computers (accounting for about 40% of global output), more than 11 million digital cameras and 7 million navigating devices. While electronics sales topped Rmb100 billion, the total volume of imports and exports broke the US$30 billion mark reaching US$31.5 billion.