Developing Central China: A New Regional Programme

Abstract

Developing Central China: A New Regional Programme Hongyi Lai As a large and diverse country, China faces problems in equitable regional development and national economic integration. From the late 1970s to the late 1990s, China's national government focussed its developmental efforts in the coastal region.1 In the late 1990s, China started to address the problems of regional imbalance in economic development. The national government launched its Western Development Programme after 1999, then a Northeast Revival Initiative after 2003. However, little consideration was given to central China.2 To make up for the neglect of central China in its past national regional development programmes, Premier Wen Jiabao declared in March 2004 that Beijing would speed up the development of this region in order to attain more balanced national development.3 Since then, fostering the rise of central China (zhongbu jueqi) has become a popular topic in China's media. Since 2003, there have been four officially-recognised regions in China. The coastal (eastern) region is comprised of ten provinces: Beijing, Tianjin, Hebei, Shandong, Shanghai, Jiangsu, Zhejiang, Fujian, Guangdong and Hainan.4 The central region includes: Shanxi, Henan, Anhui, Jiangxi, Hubei and Hunan.5 The northeast region has three provinces: Liaoning, Jilin and Heilongjiang while the western region makes up the remaining areas: Inner Mongolia, Shaanxi, Gansu, Ningxia, Qinghai, Xinjiang, Tibet, Sichuan, Chongqing, Yunnan, Guizhou and Guangxi (see Figure 1). [End Page 109] This article analyses the context, rationale, policies and prospects for developing central China. Specifically, it analyses the relative decline of central China, the loud complaints from central China elites, national leaders' announcements to develop central China and their rationale. This is followed by an overview of the economic-social profile of central China, policy stances by national leaders, measures implemented by national ministries to support central China and initiatives from individual central provinces to accelerate economic development. Finally, the article assesses the prospects for the development programme. Click for larger view Figure 1 China's Regions [End Page 110] Unbalanced Regional Development in the Reform Era Though central China has grown much faster in the reform era (since 1979) than in the Mao era, the region is falling behind the dynamic and robust coastal region in terms of per capita GDP.6 As a result of the deliberate fostering of economic development in the coastal region in the 1980s and early 1990s, the coastal region has become the pioneer in marketisation, and a national, even global assembly powerhouse (see Table 1). The robust growth of the coastal region in the reform era can be attributed to a number of factors. China's industrialisation in the 20th century was concentrated here. It has greatly benefited from several deep-water harbours, the densest transportation network, best tele-communications, one of the highest adult literacy rates and the highest per capita retail sales (see Table 2). In short, it has enjoyed access to the world and largest domestic markets as well as the country's best infrastructure and human capital. The central and western regions have benefited from the trickle-down effects of growth from the coastal region. Market forces unleashed by economic reform have facilitated factor mobility. Migrants from the central and western regions work in the manufacturing and services sectors in the coastal region. At [End Page 111] the same time, the central and western regions have expanded their production of energy, raw materials and agricultural products in order to satisfy demand in the coastal region. Click for larger view Table 1 Regional Economic Indicators, 2003 (% of national total) Click for larger view Table 2 Regional Physical and Human Indicators, 2002 Market forces, however, have not significantly reduced regional inequalities. Despite their rapid growth, the economic clout of the central and western regions has stagnated, whereas that of the coastal region has improved. [End Page 112] Multiple factors have caused this. First, the central and western regions have great disadvantages in terms of human capital, infrastructure and geographic location.7 Located far from the...