Zhejiang province released a three-year plan in February to encourage local private companies to go transnational, with the hope benefiting the development of a high-standard open economy.

The plan is expected to improve the profits of private enterprises, and to aid in transforming Zhejiang industries. The expansion of companies to the global market is good for promoting the province's products, technologies and services.

Several Zhejiang companies have recently been involved in international mergers and acquisitions, like Geely Automobile acquiring Volvo in 2010. The government has discovered these companies bring advanced technologies and management philosophies to local industries.

Zhejiang believes in the overwhelming trend of globalization and considers M&A a good path to gain access to innovative technologies. The provincial Department of Commerce hopes this plan can lead private companies in Zhejiang to develop healthy overseas businesses.

According to the plan, the province will help cultivate 20 Zhejiang-headquartered transnational private companies over three years from 2017 to 2019. These potential companies should be internationally competitive and have an overall plan to expand their business overseas.

A list of private companies earning government support is going to be released at the end of the year. The support will include guidance in tax policies, the risks assessments and other advisory services.

A delegation of company representatives from Zhejiang visits Israel in 2016. [File photo]