'Go West' policy is an economic milestone for nation

Updated: 2011-12-09 08:06

By Andrew Moody, Hu Haiyan and Ma Wei (China Daily)

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CHONGQING - China's "Go West" strategy, launched just before the country's entry into the World Trade Organization in 2001, has been a milestone in the nation's economic development.

The aim was to boost the poorer western parts of the country that had so far not enjoyed the economic benefits of China's opening up to the outside world.

Since then, some $325 billion has been invested in major infrastructure projects in the western region, one of the biggest economic regeneration programs of all time.

These have included flagship projects such as the 4,000-kilometer (km) West-East natural gas pipeline project, the second phase of which recently opened.

It also included the Qinghai-Tibet railway, completed in 2006, which runs for almost 2,000 km. Another major project was the extension of Xianyang Airport in Xi'an.

Companies relocating also benefit in some areas from a lower rate of corporate tax of 15 percent instead of the usual 25 percent.

'Go West' policy is an economic milestone for nation

Huang Zhiliang, professor and vice-president of the Chongqing Technology and Business University, said there is no doubt the strategy has had a real impact on people's lives.

"I think without it, there would have been slight, slow progress, whereas the changes have been significant and tremendous."

One major success of the strategy has been Chongqing, one of the nation's great modern cities.

Gleaming skyscrapers are now reflected in the Jialing River, which divides the city. Just a generation ago, the banks were filled with rundown housing.

The ginkgo trees, favored by the city's charismatic 61-year-old Party secretary and former Minister of Commerce Bo Xilai, that line the streets are a sign of the emphasis on green development. Major parts of the municipality have been reforested.

Professor Zhang Zongyi, vice-president of Chongqing University, said that he is reminded of the pace of development on his morning drives to work.

"The effects are very obvious. It would be difficult to calculate any actual return, but I don't think it is just about the initial investment. So much of the success of the strategy is the number of companies that have come here and are now involved in the region," he said.

The "Go West" strategy, officially called the Western Development Program, covers the municipality of Chongqing and the provinces of Gansu, Guizhou, Qinghai, Shaanxi, Sichuan and Yunnan and the autonomous regions of Guangxi, Inner Mongolia, Ningxia, Tibet and Xinjiang.

It has not been about relocating export-oriented, low-cost manufacturing from Guangdong just for the cheaper labor.

Much of the emphasis has been on bringing in new science and technology industries.

Xi'an, capital of Shaanxi Province, is famous for its Terracotta Warriors, but it is rapidly emerging as a science hub.

The city's economy has grown by 13 percent annually in each of the past 10 years, and it has attracted 76 of the top Fortune 500 companies.

There are plans to increase the urban area of the city to 1,329 square kilometers (sq km) by 2030. The "old city" within the city walls is just 13 sq km at present.

The Xi'an High-Tech Industries Development Zone (XHTZ) is one of six zones nationally that the Chinese government wants to turn into world-class science parks.

Liu Minghua, deputy director of the zone's administrative committee, said the development of the XHTZ has ended a local talent drain.

"Fresh graduates used to prefer to work in Beijing and Shanghai but now they want to work here. There are many people returning," he said.

Zhang Feng is someone who went west himself.

The 26-year-old architect stayed in Chongqing after attending a university in the city. He is originally from eastern Anhui Province.

"I can lead a more pleasant life here. I chose to stay here because of the relatively low cost of living and the fact there is plenty of scope to develop your career because there are now so many opportunities," he said.

One of the largest new economic zones in the region is the Chongqing Liangjiang New Area.

It was launched last year and will eventually cover 1,200 sq km. The goal is for it have an economy of 640 billion yuan ($100 billion) by 2020, bigger than many countries.

Li Xinming, vice-director of the zone, said its vast scale will transform the local area.

"We call it recreating the Chongqing economy in 10 years. Our development zone will be a big city in its own right. It will have five to six million residents, more than 50 percent of the urban area of Chongqing itself," he said.

Many acknowledge that the "Go-West" strategy still has some way to go. The west's share of GDP was only 17.8 percent of China's total in 2008, with the east still accounting for 41.1 percent, according to a report last year by the Center for Studies of China's Western Economic Development at Northwest University in Xi'an.

"This is still a core issue. Despite this 10-year-old policy of encouraging development in the western areas, the speed of development and urbanization still lags behind the eastern part," said Li.

China Daily

(China Daily 12/09/2011 page16)