Old industrial bases get cash ( 2004-02-02 23:41) (China Daily)
China hopes to revitalize its traditional
industrial zones with a huge infusion of cash.
Liaoning Province was the biggest recipient in the first round of "blood
transfusion" money aimed at giving new life to the industrial sector. The money
will go to 100 projects, half of them in Liaoning, mainly in the manufacturing
and raw material industries.
An official from the provincial development and reform department told China
Daily the projects need about 44.2 billion yuan (US$5.3 billion).
About 11.2 billion yuan (US$1.34 billion) will be invested into 37 projects
in Heilongjiang Province, but no details were released as to what those projects
are.
Another 11 projects in Jilin Province were given the green light in their
restructuring bids. That nod will cost the government 6 billion yuan (US$722
million), said Cao Dawei, deputy-director of provincial department of
development and reform.
Cao said the money will mainly go towards the petrochemistry, agriculture and
medicine research industries.
Since the central government launched its restructuring campaigns in 2002,
Jilin has identified dozens of projects in need of more than 40 billion yuan
(US$4.76 billion) in investment.
Government insiders said nearly one sixth of the total investment in the 100
projects will come from State revenue. But the National Development and Reform
Commission, responsible for assessing the projects, did not release any details
of the investment arrangements.
Provincial officials, however, are happy to get the money, whether it comes
from Chinese investors or foreign cash.
"We need a huge amount of capital, both from domestic and foreign investors,"
said Cao.
The announcement of the massive investment plan was another sign of the
central government's commitment to breath new life into Northeast China's
struggling economy.
By the end of last year, the central government had agreed to set up a
special national task force to deal with the issue.
The task force will likely work out of the National Development and Reform
Commission.
The investment plan and the central government's decision to form the new
task force follow the landmark decision of last year's 16th National Congress of
the Communist Party of China to put revitalizing the northeast at the top of the
government agenda.
The Political Bureau of the Central Committee of the Communist Party of China
recently called for accelerated efforts to revitalize the old northeast
industrial bases, calling it a long-term and difficult task.
The three northeast provinces of Heilongjiang, Liaoning and Jilin are known
as the "industrial cradle of China." They played a vital role in the country's
industrial development from the 1950s to the early 1970s.
However, many of the traditional industrial firms have been struggling since
the country began opening up its market more than two decades ago.
The proportion of the region's industrial output value to the national total
has dropped to 9 per cent from 17 per cent. Some money-losing State industries
were closed after laying off large numbers of workers.
