Re­lo­ca­tion rem­edy must be han­dled care­fully

China Daily (USA) - - VIEW -

For decades, Beijing, as the cap­i­tal of China, has been ex­pand­ing, with the num­ber of ring roads in­creas­ing from two to six and the pop­u­la­tion reach­ing 21.7 mil­lion in 2015. Such rapid ex­pan­sion has caused mul­ti­ple prob­lems, such as over­crowded com­mu­ni­ties, se­vere traf­fic con­ges­tion and a wors­en­ing en­vi­ron­ment. It is now ur­gent that the gov­ern­ment should find pre­scrip­tions to cure such ur­ban dis­eases.

One of the pre­scrip­tions the cen­tral gov­ern­ment has come up is re­lo­cat­ing the Beijing mu­nic­i­pal gov­ern­ment, in­dus­trial plants and other func­tions not re­lated to its role as the na­tion’s cap­i­tal out of the city cen­ter.

Many “low-end” in­dus­tries are to be re­lo­cated ac­cord­ing to a plan re­leased in April last year, and the Beijing au­thor­i­ties have fol­lowed the cen­tral gov­ern­ment’s lead by an­nounc­ing that around 200 mar­kets are also to be re­lo­cated from the cen­tral area of Beijing.

In fact, the ur­ban plan­ners are in­volved in al­most the whole process of mov­ing in­dus­tries out of the city cen­ter at present. The ur­ban au­thor­i­ties con­duct re­search and then make de­ci­sions about which in­dus­tries are to be moved out and where they are to be moved to.

That mode has both ad­van­tages and dis­ad­van­tages. One ad­van­tage is that by mak­ing the re­lo­ca­tion de­ci­sions, the au­thor­i­ties are send­ing a clear sig­nal to the whole so­ci­ety of which in­dus­tries they want to sur­vive. This in turn prompts ex­pec­ta­tions that the in­dus­tries moved out of the city cen­ter ac­cord­ing to the gov­ern­ment’s plan will re­ceive pol­icy sup­port to help them through their re­lo­ca­tion. As a re­sult, en­ter­prises and busi­nesses will in­vest in the ar­eas where th­ese in­dus­tries are be­ing re­lo­cated, which will help th­ese ar­eas pros­per and be­come newur­ban cen­ters. But there are dis­ad­van­tages, too. In a mar­ket econ­omy, it is not the gov­ern­ment but the en­ter­prises them­selves that best know what they need to thrive and so can best make the de­ci­sion about where they should be re­lo­cated. If the re­lo­ca­tion process is dom­i­nated by the gov­ern­ment it will be ir­re­versible, and some­times, even though the gov­ern­ment wants an in­dus­try to sur­vive, it does not fully know what is re­quired for them to do so. There­fore it is nec­es­sary for the au­thor­i­ties to con­sider al­low­ing the mar­ket to have a big­ger role in re­lo­ca­tion de­ci­sions. It needs to study the in­dus­tries and their mar­kets, so as to clearly pre­dict whether the in­dus­tries will pros­per af­ter be­ing moved out and which ar­eas are most suit­able for them.

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