China Vows to Revitalize Northeastern Industrial Base

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Last updated at: (Beijing Time) Wednesday, August 13, 2003

China Vows to Revitalize Northeastern Industrial Base

The three northeastern provinces of Heilongjiang, Jilin and Liaoning are formulating plans to rejuvenate the traditional industrial base of China.

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The three northeastern provinces of Heilongjiang, Jilin and Liaoning are formulating plans to rejuvenate the traditional industrial base of China.

Their plans include regrouping existing industrial enterprises, bringing in advanced technologies, boosting research and development of new products, and opening the doors of state-owned industrial enterprises to private investment from home and abroad.

The move followed a speech made by Premier Wen Jiabao during his inspection tour in the region early this month. Wen said that the central government would support the three provinces in their efforts to readjust the economic structure and to upgrade technology.

By doing so, China aims to build the northeast region into a national and even a world-class industrial base for equipment manufacturing and important raw materials, Wen said.

This showed that Chinese leaders were aware that revitalization and prosperity in this old industrial base had a very important bearing on the realization of China's goals of building a relatively affluent society and quadrupling the national GDP within 20 years, said Xu Chuanchen, director of the China State Economy Research Center at Jilin University.

Covering the provinces of Heilongjiang, Jilin and Liaoning, the northeast region, dubbed the "industrial cradle" of New China, played a major role in the industrial development of China.

The central government launched 150 state key heavy industrial projects during the first several years after the founding of New China in 1949, one-third of which were built in this region. These projects were in the fields of iron and steel, chemicals, heavy machinery, automobiles and defense industries.

However, many of the traditional industrial enterprises that were established in the 1950s when China adopted a planned economic system, became less competitive and some have been losing money over the past 20 years, during which time China implemented the policies of reform and opening up to the outside, and moved from a planned market economy toward a market economy.

The proportion of the region's industrial output value to the national total dropped to 9 percent from the former 17 percent. Some loss-making state industrial enterprises were closed.

To fully rejuvenate the declining industrial base, departments of the State Council and the governments of the three northeastern provinces are working on the plans to restructure traditional industries in the region. The central government has promised to work out preferential policies and offer financial support to industrial rejuvenation in the region.

Analysts have called the move another major strategy the Chinese government has adopted to boost its economy following its massive programs to develop the east coastal regions starting late last century and the massive program to develop the vast under-developed western region three years ago.

After more than 20 years of reform and opening to the outside world, a market economic system has taken shape in China and the overall national economic strength has increased markedly.

The revitalization program is expected to make the northeastern region a new economic growth area following the flourishing Pearl River delta in the south, a result of the reform drive, and the Yangtze River delta in the east, said Xu Zemin, a research fellow with the Heilongjiang Provincial Academy of Social Sciences.

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