China Western Development
Encyclopedia
China Western Development , also China's Western Development, Western China Development, Great Western Development Strategy, or the Open Up the West Program is a policy adopted by the People's Republic of China
to boost its less developed western regions
.
The policy covers 6 provinces (Gansu
, Guizhou
, Qinghai
, Shaanxi
, Sichuan
, and Yunnan
), 5 autonomous regions (Guangxi
, Inner Mongolia
, Ningxia
, Tibet
, and Xinjiang
), and 1 municipality (Chongqing
). This region contains 71.4% of mainland China's area, but only 28.8% of its population, as of the end of 2002, and 19.9% of its total economic output, as of 2009.
, the People's Republic of China began to reform its economy
in 1978 by changing from a command economy to a market economy
. The coastal regions of eastern China benefited greatly from these reforms, and their economies quickly raced ahead. The western half of China, however, lagged behind severely. In order to help the western half of China catch up with the eastern half, a Leadership Group for Western China Development (西部地区开发领导小组) was created by the State Council
in January 2000, led by then-Premier Zhu Rongji
.
Chronicle of Events
1999: the "Western Development" guidelines are clarified
2000: the "Western Development" plan begins
2001: the official website of the "Western Development" program is launched
2002: construction of the "West-East Gas Pipeline" begins
2003: the policy of "Returning Grazing Land to Grassland" comes into effect
2004: the Law on Promoting Western Development is listed on the legislative plan of the 10th National People's Congress
2005: compulsory education tuition and fees become exempt in western areas
2006: the Qinghai-Tibet Railway begins operation
2007: the Ministry of Finance invests 280 billion yuan in the west to support key projects
(transport, hydropower plants, energy, and telecommunications), enticement of foreign investment
, increased efforts on ecological protection (such as reforestation
), promotion of education
, and retention of talent flowing to richer provinces. As of 2006, a total of 1 trillion yuan
has been spent building infrastructure in western China.
released a list of 10 major projects to launch in 2008, with a combined budget of 436 billion yuan (64.12 billion U.S. dollars).
These projects included new railway lines connecting Guiyang and Guangzhou, Lanzhou and Chongqing, Kashgar and Hotan in Xinjiang; highways between Wanyuan and Dazhou in Sichuan Province, Shuikou and Duyun in Guizhou Province; airport expansion projects in Chengdu, Chongqing and Xi’an.
They also include the building of hydropower stations, coal mines, gas and oil transmission tube lines as well as public utilities projects in western regions.
By the end of 2007, China has started 92 key construction projects in western regions, with a total investment of more than 1.3 trillion yuan.
, including the Mekong
, the Yarlung Tsangpo and the Salween, to the dry areas of northern China through a system of reservoirs, tunnels and natural rivers. This project may be the most controversial plan to date.
From 1999 to 2001, Xinjiang and Guangxi displayed an annual GDP percent increase of as high as 30%. China's western regions have reported an annual average economic growth rate of 10.6% for six years in a row. The combined GDP of the western regions reached 3.33 trillion yuan in 2005, compared with 1.66 trillion yuan in 2000, while net income grew on average 10% for urban residents in the west and 6.8% for rural residents. Initiatives encouraging Chinese from wealthier and more crowded regions of China to move to the less crowded western regions has resulted in population growth in [a few cities], most notably Qinghai with its increase of 12.6%.
Nevertheless, the economic growth rate of China’s East continues to exceed that of the West, causing the western share of domestic product to continue to fall. The West’s contribution to the GDP decreased from 20.88% in 1990 to 17.13% in 2000. Relative levels of GDP per capita in the West decreased from 73.30% in 1990 to 60.87% in 2000. In 1990, Shanghai’s per capita GDP was 7.3 times that of Guizhou, the poorest province in China; by 2000, the figure had grown to 12.9 times. Evidence from the China Statistical Yearbook also confirms the increasing economic gap between China’s West and East, indicating that the east-to-west GDP ratio increased from 2.98 in 1980 to 4.33 in 2000.
The situation in Guizhou reveals a particularly pernicious effect of the Western Development Program. Despite the fact that Guizhou received 53.3 billion yuan in infrastructure construction in 2001 alone, more than the total amount given by the Ninth Five-Year Plan (1995-2002), its foreign capital declined from US $40.9 million in 1999 to $29.29 million in 2001, an astonishing 31% decline, reaching its lowest point since 1997. Contrary to what the state had intended, the West-East Electricity Transfer Project in Guizhou only assured the continued increase in foreign investment on the coast, as most of the electricity generated in Guizhou was transmitted to Guangdong.
Tim Oakes, associate professor of geography at the University of Colorado at Boulder, argues that the decline of foreign investment in certain western regions is a consequence of Beijing’s attempt to recentralize the province’s economy through mega-projects such as Guizhou’s west-east electricity transfer project. The strengthening of central control over the economy has eroded the trust of foreign investors. In the case of Guizhou, while the Chinese central government intended to attract foreign investment in the power sector through the West-East Electricity Transfer Project, only 5% of foreign investment entered the energy sector. About 75% of Guizhou’s foreign investment was channeled into manufacturing and 15% to real estate development. Because the campaign’s economic program is strongly central planned, the campaign has actually discouraged foreign investment, working against its original intent.
Although the project seems to be going successfully, it creates a potential fiscal burden for the government. Massive farmland conversion requires a tremendous amount of funding for resettling the farmers. In addition, to compensate farmers for their loss in agricultural profit, the state has committed to supplying them with grains and funds for planting trees and grass. This results in a prescribed allotment of 60 yuan per mu by the central policy. A further complication is farmer dissatisfaction when the government fails to deliver on its contract, since the local government usually bases compensation on actual production value, resulting in compensation between 20-50 yuan, plus a 300 jin appropriation of grain.
Farmers who are temporarily benefiting from the compensation will soon rely on governmental subsidy once the tree-planting project is completed. 81,000 tons of grain, 154 million yuan in cash subsidies and 266 million yuan for tree saplings to almost 800,000 farming households have already been spent in Shaanxi. If the provincial government decides to honor its commitment for another 5-8 years, it will cost a total of 11.7 billion yuan in grain and cash subsidies. The heavy financial cost makes the sustainability of the environmental project questionable.
Furthermore, while the environmental project is critically emphasized in the campaign, very little has been discussed on the impact of intensified coal extraction, increased thermal plant operation, reservoir inundation, and transportation and transmission line construction, all of which create a more detrimental impact to the environment that the environmental program can compensate for.
People's Republic of China
China , officially the People's Republic of China , is the most populous country in the world, with over 1.3 billion citizens. Located in East Asia, the country covers approximately 9.6 million square kilometres...
to boost its less developed western regions
Western China
Western China , refers to the western part of China. In the definition of the Chinese government, Western China covers six provinces: Gansu, Guizhou, Qinghai, Shaanxi, Sichuan, and Yunnan; one municipality: Chongqing; and three autonomous regions: Ningxia, Tibet, and Xinjiang.-Administrative...
.
The policy covers 6 provinces (Gansu
Gansu
' is a province located in the northwest of the People's Republic of China.It lies between the Tibetan and Huangtu plateaus, and borders Mongolia, Inner Mongolia, and Ningxia to the north, Xinjiang and Qinghai to the west, Sichuan to the south, and Shaanxi to the east...
, Guizhou
Guizhou
' is a province of the People's Republic of China located in the southwestern part of the country. Its provincial capital city is Guiyang.- History :...
, Qinghai
Qinghai
Qinghai ; Oirat Mongolian: ; ; Salar:) is a province of the People's Republic of China, named after Qinghai Lake...
, Shaanxi
Shaanxi
' is a province in the central part of Mainland China, and it includes portions of the Loess Plateau on the middle reaches of the Yellow River in addition to the Qinling Mountains across the southern part of this province...
, Sichuan
Sichuan
' , known formerly in the West by its postal map spellings of Szechwan or Szechuan is a province in Southwest China with its capital in Chengdu...
, and Yunnan
Yunnan
Yunnan is a province of the People's Republic of China, located in the far southwest of the country spanning approximately and with a population of 45.7 million . The capital of the province is Kunming. The province borders Burma, Laos, and Vietnam.Yunnan is situated in a mountainous area, with...
), 5 autonomous regions (Guangxi
Guangxi
Guangxi, formerly romanized Kwangsi, is a province of southern China along its border with Vietnam. In 1958, it became the Guangxi Zhuang Autonomous Region of the People's Republic of China, a region with special privileges created specifically for the Zhuang people.Guangxi's location, in...
, Inner Mongolia
Inner Mongolia
Inner Mongolia is an autonomous region of the People's Republic of China, located in the northern region of the country. Inner Mongolia shares an international border with the countries of Mongolia and the Russian Federation...
, Ningxia
Ningxia
Ningxia, formerly transliterated as Ningsia, is an autonomous region of the People's Republic of China. Located in Northwest China, on the Loess Plateau, the Yellow River flows through this vast area of land. The Great Wall of China runs along its northeastern boundary...
, Tibet
Tibet Autonomous Region
The Tibet Autonomous Region , Tibet or Xizang for short, also called the Xizang Autonomous Region is a province-level autonomous region of the People's Republic of China , created in 1965....
, and Xinjiang
Xinjiang
Xinjiang is an autonomous region of the People's Republic of China. It is the largest Chinese administrative division and spans over 1.6 million km2...
), and 1 municipality (Chongqing
Chongqing
Chongqing is a major city in Southwest China and one of the five national central cities of China. Administratively, it is one of the PRC's four direct-controlled municipalities , and the only such municipality in inland China.The municipality was created on 14 March 1997, succeeding the...
). This region contains 71.4% of mainland China's area, but only 28.8% of its population, as of the end of 2002, and 19.9% of its total economic output, as of 2009.
History
Under the leadership of Deng XiaopingDeng Xiaoping
Deng Xiaoping was a Chinese politician, statesman, and diplomat. As leader of the Communist Party of China, Deng was a reformer who led China towards a market economy...
, the People's Republic of China began to reform its economy
Chinese economic reform
The Chinese economic reform refers to the program of economic reforms called "Socialism with Chinese characteristics" in the People's Republic of China that were started in December 1978 by reformists within the Communist Party of China led by Deng Xiaoping.China had one of the world's largest...
in 1978 by changing from a command economy to a market economy
Market economy
A market economy is an economy in which the prices of goods and services are determined in a free price system. This is often contrasted with a state-directed or planned economy. Market economies can range from hypothetically pure laissez-faire variants to an assortment of real-world mixed...
. The coastal regions of eastern China benefited greatly from these reforms, and their economies quickly raced ahead. The western half of China, however, lagged behind severely. In order to help the western half of China catch up with the eastern half, a Leadership Group for Western China Development (西部地区开发领导小组) was created by the State Council
State Council of the People's Republic of China
The State Council of the People's Republic of China , which is largely synonymous with the Central People's Government after 1954, is the chief administrative authority of the People's Republic of China. It is chaired by the Premier and includes the heads of each governmental department and agency...
in January 2000, led by then-Premier Zhu Rongji
Zhu Rongji
Zhū Róngjī is a prominent Chinese politician who served as the Mayor and Party chief in Shanghai between 1987 and 1991, before serving as Vice-Premier and then the fifth Premier of the People's Republic of China from March 1998 to March 2003.A tough administrator, his time in office saw the...
.
Chronicle of Events
1999: the "Western Development" guidelines are clarified
2000: the "Western Development" plan begins
2001: the official website of the "Western Development" program is launched
2002: construction of the "West-East Gas Pipeline" begins
2003: the policy of "Returning Grazing Land to Grassland" comes into effect
2004: the Law on Promoting Western Development is listed on the legislative plan of the 10th National People's Congress
2005: compulsory education tuition and fees become exempt in western areas
2006: the Qinghai-Tibet Railway begins operation
2007: the Ministry of Finance invests 280 billion yuan in the west to support key projects
Strategy
The main components of the strategy include the development of infrastructureInfrastructure
Infrastructure is basic physical and organizational structures needed for the operation of a society or enterprise, or the services and facilities necessary for an economy to function...
(transport, hydropower plants, energy, and telecommunications), enticement of foreign investment
Investment
Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...
, increased efforts on ecological protection (such as reforestation
Reforestation
Reforestation is the natural or intentional restocking of existing forests and woodlands that have been depleted, usually through deforestation....
), promotion of education
Education
Education in its broadest, general sense is the means through which the aims and habits of a group of people lives on from one generation to the next. Generally, it occurs through any experience that has a formative effect on the way one thinks, feels, or acts...
, and retention of talent flowing to richer provinces. As of 2006, a total of 1 trillion yuan
Chinese yuan
The yuan is the base unit of a number of modern Chinese currencies. The yuan is the primary unit of account of the Renminbi.A yuán is also known colloquially as a kuài . One yuán is divided into 10 jiǎo or colloquially máo...
has been spent building infrastructure in western China.
Transportation
The western development bureau affiliated to the state councilState Council of the People's Republic of China
The State Council of the People's Republic of China , which is largely synonymous with the Central People's Government after 1954, is the chief administrative authority of the People's Republic of China. It is chaired by the Premier and includes the heads of each governmental department and agency...
released a list of 10 major projects to launch in 2008, with a combined budget of 436 billion yuan (64.12 billion U.S. dollars).
These projects included new railway lines connecting Guiyang and Guangzhou, Lanzhou and Chongqing, Kashgar and Hotan in Xinjiang; highways between Wanyuan and Dazhou in Sichuan Province, Shuikou and Duyun in Guizhou Province; airport expansion projects in Chengdu, Chongqing and Xi’an.
They also include the building of hydropower stations, coal mines, gas and oil transmission tube lines as well as public utilities projects in western regions.
By the end of 2007, China has started 92 key construction projects in western regions, with a total investment of more than 1.3 trillion yuan.
Hydraulic projects
The Big Western Line, a possible element of the South–North Water Transfer Project, is a proposal for diverting water from the upstream sections of six rivers in southwestern ChinaChina
Chinese civilization may refer to:* China for more general discussion of the country.* Chinese culture* Greater China, the transnational community of ethnic Chinese.* History of China* Sinosphere, the area historically affected by Chinese culture...
, including the Mekong
Mekong
The Mekong is a river that runs through China, Burma, Laos, Thailand, Cambodia and Vietnam. It is the world's 10th-longest river and the 7th-longest in Asia. Its estimated length is , and it drains an area of , discharging of water annually....
, the Yarlung Tsangpo and the Salween, to the dry areas of northern China through a system of reservoirs, tunnels and natural rivers. This project may be the most controversial plan to date.
Economic Developments
China’s attempt to develop its western regions has had varying effects on the West’s economic development. While massive investment has boosted the region’s output, effectively raising the GDP in all western regions, the project failed to achieve its goal of eliminating the economic gap between China’s East and West.From 1999 to 2001, Xinjiang and Guangxi displayed an annual GDP percent increase of as high as 30%. China's western regions have reported an annual average economic growth rate of 10.6% for six years in a row. The combined GDP of the western regions reached 3.33 trillion yuan in 2005, compared with 1.66 trillion yuan in 2000, while net income grew on average 10% for urban residents in the west and 6.8% for rural residents. Initiatives encouraging Chinese from wealthier and more crowded regions of China to move to the less crowded western regions has resulted in population growth in [a few cities], most notably Qinghai with its increase of 12.6%.
Nevertheless, the economic growth rate of China’s East continues to exceed that of the West, causing the western share of domestic product to continue to fall. The West’s contribution to the GDP decreased from 20.88% in 1990 to 17.13% in 2000. Relative levels of GDP per capita in the West decreased from 73.30% in 1990 to 60.87% in 2000. In 1990, Shanghai’s per capita GDP was 7.3 times that of Guizhou, the poorest province in China; by 2000, the figure had grown to 12.9 times. Evidence from the China Statistical Yearbook also confirms the increasing economic gap between China’s West and East, indicating that the east-to-west GDP ratio increased from 2.98 in 1980 to 4.33 in 2000.
Foreign Investment
Since the introduction of economic reform and open-door policy in 1978, the western region has been in a disadvantageous economic position because it promises a less lucrative return to the investors than its eastern competitors. Therefore, one of the major objectives of the Open Up the West initiative was to bring in foreign investment by creating a more stable investing environment through infrastructure construction. This was a success for the western development project at some level, for statistics shows a substantial growth in foreign investment in the western regions, from US $1,837.35 million in 1999 to $1,922.19 million in 2001. However, not all areas in the western region shared in this progress. While foreign direct investment in Chongqing grew US $17.56 million between 1999 and 2001 (from US $238.93 million to $256.49 million), foreign investment in Guizhou, Guangxi and Ningxi declined significantly, dropping about USD $19.71, $250.96 million, and $34.54 million respectively.The situation in Guizhou reveals a particularly pernicious effect of the Western Development Program. Despite the fact that Guizhou received 53.3 billion yuan in infrastructure construction in 2001 alone, more than the total amount given by the Ninth Five-Year Plan (1995-2002), its foreign capital declined from US $40.9 million in 1999 to $29.29 million in 2001, an astonishing 31% decline, reaching its lowest point since 1997. Contrary to what the state had intended, the West-East Electricity Transfer Project in Guizhou only assured the continued increase in foreign investment on the coast, as most of the electricity generated in Guizhou was transmitted to Guangdong.
Tim Oakes, associate professor of geography at the University of Colorado at Boulder, argues that the decline of foreign investment in certain western regions is a consequence of Beijing’s attempt to recentralize the province’s economy through mega-projects such as Guizhou’s west-east electricity transfer project. The strengthening of central control over the economy has eroded the trust of foreign investors. In the case of Guizhou, while the Chinese central government intended to attract foreign investment in the power sector through the West-East Electricity Transfer Project, only 5% of foreign investment entered the energy sector. About 75% of Guizhou’s foreign investment was channeled into manufacturing and 15% to real estate development. Because the campaign’s economic program is strongly central planned, the campaign has actually discouraged foreign investment, working against its original intent.
Environmental Protection
Foreseeing significant environmental impacts in the massive infrastructure development program, the state highly publicizes environmental preservation in its campaign to open up the West. Farmland conversion to forest and grassland is the dominant strategy for this effort, targeting specifically the regions crucial to the Yangtze’s protection. In Sichuan, the government aims to protect the 19.23 million hectares of existing forest and plant an additional 2.93 million hectares of new forest to diminish the amount of silt flowing into the Yangtze. Around 20,000 mu of farmland was converted in Guizhou in 2001, a key region for Yangtze preservation. In Shaanxi, 571,000 hectares of farmland and 427,000 hectares of wasteland were converted to forest or grass between 1999 and 2002. Another 280,000 hectares of farmland and the same expanse of wasteland were converted in 2003. China’s environmental program in the west has made China “one of a few countries in the world that have been rapidly increasing their forest cover,” according to David Dollar, director of the World Bank in China.Although the project seems to be going successfully, it creates a potential fiscal burden for the government. Massive farmland conversion requires a tremendous amount of funding for resettling the farmers. In addition, to compensate farmers for their loss in agricultural profit, the state has committed to supplying them with grains and funds for planting trees and grass. This results in a prescribed allotment of 60 yuan per mu by the central policy. A further complication is farmer dissatisfaction when the government fails to deliver on its contract, since the local government usually bases compensation on actual production value, resulting in compensation between 20-50 yuan, plus a 300 jin appropriation of grain.
Farmers who are temporarily benefiting from the compensation will soon rely on governmental subsidy once the tree-planting project is completed. 81,000 tons of grain, 154 million yuan in cash subsidies and 266 million yuan for tree saplings to almost 800,000 farming households have already been spent in Shaanxi. If the provincial government decides to honor its commitment for another 5-8 years, it will cost a total of 11.7 billion yuan in grain and cash subsidies. The heavy financial cost makes the sustainability of the environmental project questionable.
Furthermore, while the environmental project is critically emphasized in the campaign, very little has been discussed on the impact of intensified coal extraction, increased thermal plant operation, reservoir inundation, and transportation and transmission line construction, all of which create a more detrimental impact to the environment that the environmental program can compensate for.
Recent developments
- Chongqing MetroChongqing MetroThe Chongqing Rail Transit also known as Chongqing Metro, is a metro system in Chongqing, China that has been in operation since 2005. CRT serves transportation needs in the city's main business and entertainment downtown areas...
- Qingzang railwayQingzang railwayThe Qinghai–Xizang railway, Qingzang railway, or Qinghai–Tibet railway , is a high-elevation railway that connects Xining, Qinghai Province, to Lhasa, Tibet Autonomous Region, in People's Republic of China....
, linking LhasaLhasaLhasa is the administrative capital of the Tibet Autonomous Region in the People's Republic of China and the second most populous city on the Tibetan Plateau, after Xining. At an altitude of , Lhasa is one of the highest cities in the world...
and XiningXiningXining is the capital of Qinghai province, People's Republic of China, and the largest city on the Tibetan Plateau. It has 2,208,708 inhabitants at the 2010 census whom 1,198,304 live in the built up area made of 4 urban districts.-History:...
See also
- Bohai Economic RimBohai Economic RimThe Bohai Economic Rim or BER or Bohai Bay Economic Rim is a term used to describe the economic hinterland surrounding Beijing and Tianjin. It also includes areas in Hebei, Liaoning and Shandong which surrounds the Bohai Sea. This region has gone through major changes in economic and infrastructures...
- Yangtze River Delta Economic ZoneYangtze River Delta Economic ZoneYangtze River Delta Economic Zone or Yangtze River Delta Economic Region is an economic region in China that encompasses Shanghai municipality, Zhejiang and Jiangsu province...
- Northeast China Revitalization
- Rise of Central China Plan
- Economy of the People's Republic of ChinaEconomy of the People's Republic of ChinaThe People's Republic of China ranks since 2010 as the world's second largest economy after the United States. It has been the world's fastest-growing major economy, with consistent growth rates of around 10% over the past 30 years. China is also the largest exporter and second largest importer of...
Further reading
- Asia Times Online: Asphalt net covers China's west
- China's Campaign to 'Open up the West'National, Provincial and Local Perspectives, The China Quarterly Special Issues (No. 5), Edited by David S. G. Goodman