En­hanc­ing North­east’s econ­omy

Stim­u­lus pack­age aims to drive for­ward in­no­va­tion and boost man­u­fac­tur­ing ca­pa­bil­ity

China Daily (USA) - - POLICY REVIEW - By HUYONGQI huyongqi@chi­nadaily.com.cn

To boost the slow­ing econ­omy in North­east China, the cen­tral govern­ment has an­nounced an­other round of stim­u­lus mea­sures for in­no­va­tion and to up­grade the man­u­fac­tur­ing sec­tor.

he 13th Five-Year Plan for Re­vi­tal­iz­ing North­east China was ap­proved by the State Coun­cil, or China’s Cab­i­net, last Tues­day along with an­other sup­port­ive doc­u­ment to in­tro­duce mea­sures at the sec­ond meet­ing of the Lead­ing Group for Re­vi­tal­iz­ingNorth­east China and Other Old In­dus­trial Bases, which was presided over by Premier Li Ke­qiang.

The doc­u­ments are the lat­est move by the cen­tral govern­ment to sup­port the de­vel­op­ment of Liaon­ing, Jilin andHei­longjiang prov­inces, as well as the eastern part of the In­ner Mon­go­lia au­ton­o­mous re­gion, which ge­o­graph­i­cally neigh­bors, and was, his­tor­i­cally, part of North­east China.

North­east China has more than 120 mil­lion peo­ple and has played a key role in nurs­ing the coun­try’s in­dus­trial out­put since 1949. China’s first do­mes­ti­cal­ly­made ve­hi­cle was pro­duced in 1956 in Changchun, provin­cial cap­i­tal of Jilin. The re­gion’s con­tri­bu­tion to China was sim­i­lar to the Ruhr Val­ley’s in Ger­many.

The re­gion’s pil­lar in­dus­tries em­braced au­to­mo­bile-making, equip­ment man­u­fac­tur­ing, and some heavy in­dus­tries such as steel and iron, as well as coal min­ing. As the cen­tral govern­ment pro­motes cut­ting over­ca­pac­ity and eco­nomic re­struc­tur­ing, the re­gion’s econ­omy seemed sud­denly to brake.

Liaon­ing, which has re­lied on energy pro­duc­tion, agri­cul­tural goods and com­modi­ties, saw its GDP de­crease by 1 per­cent for the first half of this year com­pared to the same pe­riod last year, the low­est in the coun­try.

All of these sec­tors have been suf­fer­ing over­ca­pac­ity and, con­se­quently, de­clin­ing prices. This sit­u­a­tion, to­gether with fall­ing pri­vate in­vest­ment, cur­tailed the prov­ince’s growth, Liang Qi­dong, vice-pres­i­dent of the Liaon­ing Acad­emy of So­cial Sciences, told thep­a­per.cn, a news web­site based in Shang­hai.

Mean­while, the past year saw a sharp de­cline in pri­vate in­vest­ment in North­east China, with that in Liaon­ing de­creas­ing by 58 per­cent in the first half of this year.

North­east China bor­ders Siberia, North Korea and Mon­go­lia, where border trade and eco­nomic ex­changes are much less ac­tive and prof­itable than in south­ernChina, said LyuChao, a re­searcher on border stud­ies at the Liaon­ing Acad­emy of So­cial Sciences.

At the meet­ing, the premier called on lo­cal gov­ern­ments to boost in­no­va­tive tech­nolo­gies and ways of man­age­ment, and link their equip­ment man­u­fac­tur­ing with ad­vanced de­signs as used in the south.

LuHao, gov­er­nor ofHei­longjiang prov­ince, said some for­mer em­ploy­ees of coal mines have started to sell high-qual­ity agri­cul­tural goods on­line. The premier said, in re­sponse, that the key to up­grad­ing the lo­cal econ­omy still re­lies on in­no­va­tion.

Li added that the busi­ness en­vi­ron­ment must be changed to usher in new in­vestors. Af­ter the meet­ing, many ne­ti­zens com­plained on­line of the re­gion’s slug­gish busi­ness en­vi­ron­ment and low ef­fi­ciency.

“I heard from some of the re­gion’s en­trepreneurs that a project was re­quired to get more than 200 seals be­fore be­ing ap­proved,’’ the premier said. “Many of them have com­plained that the busi­ness en­vi­ron­ment in the north­east is much worse than some re­gions in the south. The north­east must fol­low the south to im­prove gov­ern­men­tal ser­vices and pri­or­i­tize in­vest­ment to at­tract newin­vestors.”

The premier also in­quired why the re­gion has none of the coun­try’s top 100 in­ter­net com­pa­nies while it can boast hun­dreds of renowned uni­ver­si­ties and re­search in­sti­tutes which should have pro­vided a strong mo­men­tum for in­no­va­tion.

Many col­lege stu­dents would rather go south than stay in the re­gion af­ter grad­u­a­tion and a large num­ber of well-known crafts­men have been lured by bet­ter pay­ment from com­pa­nies in the south, Lyu said.

The re­gion should also in­tro­duce in­ter­na­tional busi­ness man­age­ment for mar­ket­ing to ex­plore a wider global mar­ket, Lyu said. Other cities could learn from Shenyang, cap­i­tal of Liaon­ing prov­ince. The city has an in­dus­trial park jointly launched with­Ger­many tomake prod­ucts, such asBMW­cars, he added.

For­tu­nately, Lyu be­lieved, the re­gion still en­joys an ad­van­ta­geous ge­o­graph­i­cal lo­ca­tion to make use of rich re­sources, and ex­ports from neigh­bor­ing coun­tries that can help up­grade pil­lar in­dus­tries. “As the mea­sures are car­ried out, the re­gion can see bright prospects as long as it changes deep-seated and out­dated think­ing and man­age­ment to keep ex­per­tise and in­vest­ment,” Lyu added.

The north­east must fol­low the south to im­prove gov­ern­men­tal ser­vices and pri­or­i­tize in­vest­ment to at­tract new in­vestors.”

SHI YU / FOR CHINA DAILY

Li Ke­qiang, Premier

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