The best is yet to come

Huang Xiaowu, Party chief of Huaibei

The Huaihe River is the dividing line between China’s north and south. Huaibei in Anhui province means “north of the Huaihe river”, although the city actually lies more than 100 kilometers from the waterway.

The city was founded in 1960 to produce coal to fuel the country’s development. Originally called Suixi, which is now the name of a county in Huaibei, it was renamed Huaibei in 1971.

Huainan, also in Anhui, whose name literally means “south of the Huaihe River”, has a longer history of coal production, so the State Council renamed our city to remind people that it was also one of the country’s largest coal production bases.

In recent decades, Huaibei has produced about 1 billion metric tons of raw coal. For decades, it was the largest power generation base in East China and provided the electricity that enabled the area, one of China’s most developed regions, to prosper.

Coal production kept the city on a fast developmental track economically, especially in the years from 2003 to 2012, the “Golden Decade” of coal production, when China developed rapidly and the price of raw coal rose continuously.

The period also saw the fastest development of the city’s real estate sector as people became wealthier.

I came to Huaibei in 2013, as the mayor at first. In the middle of the previous year, the price of coal had started to fall as a result of the general economic slowdown, not just in China but across the world.

By end of last year, when I became the city’s Party chief, the price of raw coal had fallen by almost two-thirds.

In 2012, the city’s housing inventory climbed to the highest level on record. The real estate sector fell into unprecedented difficulties, too. While other cities could rely on selling plots of land to property developers, we could not.

In 2011, the coal production sector contributed nearly 5 billion yuan ($760 million) to the city’s tax revenue, accounting for nearly 52 percent of the total. Last year, by contrast, the annual tax revenue from the sector fell to slightly more than 1 billion yuan.

As a proportion of total tax revenue the figure fell to 11.5 percent. Meanwhile, the proportion of value added from non-coal industries in the total value added of industrial enterprises above a designated size (those with annual sales revenue of more than 20 million yuan) climbed from 40.6 percent in 2011 to 71.7 percent last year.

Those examples mean we are not so reliant on coal production now, but the process of achieving those favorable results was really painstaking.

We should reduce overcapacity in coal production while maintaining the development of the sector because tens of thousands of workers and their families still rely on the industry.

We should develop totally new industries, foster startups, bolster high-tech companies and compete with other cities to attract outside investment. We should maintain the coal industry, but in upgraded ways.

In September, last year, we agreed a new strategy to build China’s Carbon Technology Valley — which means we will not merely dig the fuel, sell it and burn it, but also rely on advanced technologies to produce more valuable materials and end products.

The strategy also includes environmentally friendly developments. One example of our efforts is the transformation of 12,420 hectares of land affected by mining-related subsidence into wetland parks and tourist spots.

I cannot yet say we have achieved our goals. We have just started to grow and the best is yet to come.

The city was built by people migrating from across the country to work in the mining industry, and we expect more people can come here to live, to work, to invest, and even to just take a look.