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Assessing the “Revive the Northeast” (zhenxing dongbei) Programme: Origins, Policies and Implementation*

Published online by Cambridge University Press:  30 March 2009

Jae Ho Chung ,
Hongyi Lai  and
Jang-Hwan Joo
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Abstract

This article, focusing on the “revive the northeast” programme, examines four questions: why was the northeast region selected as yet another macro-site for Beijing-endorsed scheme of regional development; how does it differ from the “develop the west” scheme; what does the “revive the northeast” scheme entail in concrete policy terms; and how can we assess the impact of this scheme on the region's economic development? While it offers a relatively positive assessment of the programme's impact in facilitating a faster growth during 2004–06, future challenges are also noted for a sustainable development of the northeast region as a whole.

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The China Quarterly , Volume 197 , March 2009 , pp. 108 - 125
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Copyright © The China Quarterly 2009

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References

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9 While the coastal portion of Liaoning province has greatly benefited from the coastal development strategy and Jilin could have been the main beneficiary of the Tumen River Area Development Project, northeast China as a whole was never the focus of a centrally-supported regional development scheme. See Cotton, James, “Jilin's coastal development strategy: China and the Tumen River cooperation,” Asian Survey, Vol. 36, No. 11 (1996), pp. 1086–101CrossRefGoogle Scholar.

10 Zhongguo tongji nianjian 2003 (China Statistical Yearbook 2003) (Beijing: Zhongguo tongji chubanshe, 2003), p. 178.

11 In 2002 in Heilongjiang alone, over 6,000 state-owned enterprises with deficits had 800,000 redundant workers. And Liaoning had over two million laid-off workers during 2000–03. See “Baiwan xiaganggong shengfu zui toutong” (“Millions of on-the-job unemployed were the biggest headache for the provincial government), Ming pao, 13 August 2003.

12 See Schechter, Danny, Falun Gong's Challenge to China (New York: Akashic Books, 2000)Google Scholar, ch. 5.

13 Interviews at the State Council Office for Reviving the Northeast, 23 November 2004.

14 Eckholm, Erik, “Leaner factories, fewer workers bring more labor unrest to China,” New York Times, 19 March 2002Google Scholar.

15 For the severe problems with collective public security incidents (quntixing zhian shijian) in Heilongjiang (ranked second in terms of participants per protest), Liaoning (ranked sixth) and Jilin (ranked tenth), see Chung, Jae Ho, Lai, Hongyi and Xia, Ming, “Mounting challenges to governance in China: surveying collective protestors, religious sects and criminal organizations,” China Journal, No. 56 (2006), pp. 20–21Google Scholar.

16 See Chen, Bei, “Zhongyang qidong zhenxing dongbei zhanlue” (“The centre initiates the ‘revive the northeast’ strategy”), Jinre xinxibao (Today's News), 18 August 2003Google Scholar; and Miller, Tom, “Reviving northeast China,” Asia Times, 14 September 2005Google Scholar.

17 See “Sanzhong quanhui de buxieyin” (“Discords at the Third Plenum of the Central Committee”), Zhengming (Contend), November 1998, pp. 14–16; and Yi, Ning and Ning, Dong, Dongbei zhazheng – Dongbei wenti baogao (How to Fix the Northeast: Report on the Northeast Problem) (Beijing: Dangdai shijie chubanshe, 2004), pp. 42–43Google Scholar.

18 Ailing, Tan, “Dongbei zhenxing guoce chutai qianhou” (“The stories behind the launch of the ‘revive the northeast’ scheme”), Ershiyi shiji jingji daobao (21st Century Economic Herald), 13 August 2003Google Scholar. Many senior scholars like Wu Jinglian then thought that the northeast's problem was not simply because of a lack of support from Beijing but rather because of insufficient liberation of ideas and staunch conservatism there. Interviews in Beijing in February 2006 and in Hong Kong in January 2007.

19 Wensi, Xia, “Hu Jintao zhuazhu dongbei daji Shanghaibang” (“Hu Jintao grasps the northeast and strikes the Shanghai gang”), Kaifang (Open), November 2003, pp. 18–19Google Scholar.

20 Interviews with officials at the State Council Office for Reviving the Northeast in December 2004 and February 2006; Dongyan, Wu, “Zhenxing dongbei guoce chutai qianhou” (“The stories behind the launch of the ‘revive the northeast’ programme”), Liaoning ribao, 29 October 2003Google Scholar; and Mu, Qiao, Zhenxing dongbei (Revive the Northeast) (Beijing: Zhongguo gongren chubanshe, 2004), p. 53Google Scholar.

21 See Qiao Mu, Revive the Northeast, pp. 51–57.

22 While, at the time, there were some competing proposals – in support of designating the central region and the pan-Pearl River Delta (fan Zhujiang sanjiaozhou) region – this time, the “revive the northeast” programme had an upper hand. Interviews with officials of the State Council Office for Reviving the Northeast in December 2004 and January 2006.

23 For such reasoning in general, see Teiwes, Frederick C., “Provincial politics in China: themes and variations,” in Lindbeck, John M. H. (ed.), China: Management of a Revolutionary Society (Seattle: University of Washington Press, 1971), pp. 116–89Google Scholar. In the context of the two schemes, see Lai, Hongyi H., “National unity and security in China's western development,” Provincial China, Vol. 8, No. 2 (2003), pp. 123–25Google Scholar; and Jun, Jian, “Xibu kaifa dongbei zhenxing bibikan” (“Comparing the ‘develop the west’ and ‘revive the northeast’ schemes”), Xibu dakaifa (The “Develop the West” Programme), December 2004, pp. 19–20Google Scholar.

24 Guirong, Li, “Zhenxing dongbei gongye jidi yu xibu dakaifa de hudong xiaoying yanjiu” (“Study of interactive effects between the northeast's industrial base and the ‘develop the west’ programme”), Shengchanli yanjiu (Productivity Research), No. 2 (2005), pp. 126–27Google Scholar.

25 Interviews in Beijing in February 2006; the website of SDRC at http://www.ndrc.gov.cn (last accessed 16 October 2005); and Guowuyuan zhenxing dongbei diqu deng laogongye jidi lingdao xiaozu bangongshi (ed.), Zhenxing dongbei diqu deng laogongye jidi 2004niandu baogao (The 2004 Report on the Scheme of “Reviving the Northeast and Old Industrial Bases”) (Beijing: Zhongguo caizheng jingji chubanshe, 2005), pp. 89–139. As of early 2006, there were totals of 26 personnel (bianzhi) for the “revive the northeast” office and 37 for the “develop the west” office.

26 Interviews in Beijing in February 2006.

27 For different environments of the northeast, see Schueller, Margot, “Liaoning: struggling with the burdens of the past,” in Goodman, David S. G. (ed.), China's Provinces in Reform: Class, Community and Political Culture (London: Routledge, 1997), pp. 93–121Google Scholar; and Christoffersen, Gaye, “The political implications of Heilongjiang's industrial structure,” in Fitzgerald, John (ed.), Rethinking China's Provinces (London: Routledge, 2002), pp. 221–46Google Scholar.

28 See Pingping, Liu, “Xibu dakaifa yu zhenxing dongbei de zhengce quxiang bijiao fenxi” (“A comparative analysis of policy orientations of the ‘develop the west’ and ‘revive the northeast’ schemes”), Sichuan jingji guanli xueyuan xuebao (Journal of Sichuan Economic Management College), No. 1 (2005), p. 37Google Scholar.

29 See http://www.chinawest.gov.cn and http://www.chinaeast.gov.cn. Also see “Zhuanfang Zhang Guobao” (“Visiting Mr Zhang Guobao”), Xinhuawang, 22 November 2004, at http://news.xinhuanet.com/fortune/2004–11/22/content_2246814.htm) (last accessed 17 October 2005).

30 Wanming, Li, Cuijin, Li and Ping, Xue, “Xibu dakaifa de xianzhuang fenxi ji qianjing zhanwang” (“An analysis of and prospect for the ‘develop the west’ scheme”), Xinjiang nongye jingji (Agricutural Economy in Xinjiang), No. 1 (2005), pp. 28–29Google Scholar.

31 For this, in July 2001, the State Council approved Liaoning to carry out experimental social security reforms and in 2004 Heilongjiang and Jilin also joined the reforms. They are designed to build an urban social security system that operates independently of enterprises and public institutions, with diversified sources of funds, and offers marketized services. The government makes a contribution to insured employees' accounts at a rate of 3.75% of their wages, and the employers 1.25%. “Certain Opinions,” Part XII and interviews in Beijing, February 2006.

32 “Zhang Guobao zai guoxinban jizhehui shang de jianghua” (“Zhang Guobao's speech at the press conference held by the State Council's Information Office”), Xinhuawang, 2 March 2005 at http://news.xinhuanet.com/2005-03/02/content_2638389.htm (last accessed 17 October 2005).

33 See Tianqi, Sun and Wei, Liu, “Xibu kaifa yu dongbei zhenxing – liangda quyu jingji jiegou de bijiao yu zhichi zhengce de sikao” (“The ‘develop the west’ and ‘revive the northeast’ schemes – comparing the economic structures and devising policies of mutual support between the two regions”), Henan jinrong guanli xueyuan xuebao (Journal of Henan College of Financial Management), No. 6 (2004), pp. 68–69Google Scholar; and Lijun, Lu and Yanwei, Zheng, Dongbu qiye xijin de moshi yu xingwei (On Enterprises from the East Moving Westward: Modes and Behaviour) (Beijing: Zhongguo jingji chubanshe, 2004)Google Scholar.

34 See Guowuyuan zhenxing dongbei diqu deng laogongye jidi lingdao xiaozu bangongshi, The 2004 Report, pp. 332–35; and Guohong, Zhang, “Waishang zhijie touzi yu jingji zengzhang – jianlun dongbei laogongye jidi zhenxing zhong liyong waizi wenti” (“Foreign direct investment and economic growth – in the context of reviving the northeast old industrial base”), Xueshu jiaoliu (Scholarly Exchange), July 2005, pp. 83–84Google Scholar.

35 For the west, see “Guowuyuan guanyu shishi xibu dakaifa ruogan zhengce cuoshi de tongzhi” (“The State Council's announcement on several policy measures for implementing the ‘develop the west’ programme”), Guofa, No. 33 (2000). For the northeast, see “Guowuyuan bangongting guanyu cujin dongbei laogongye jidi jinyibu kuoda duiwai kaifang de shishi yijian” (“The State Council Administrative Office's opinions on the implementation of measures to further open the northeast old industrial base to the outside”), Guobanfa, No. 36 (2005). As of 2005, the leading trading partners for Liaoning, Heilongjiang and Jilin were Japan, Japan and Hong Kong, respectively.

36 Interviews in Beijing in February 2006.

37 Pertinent documents are found in Guowuyuan zhenxing dongbei diqu deng laogongye jidi lingdao xiaozu bangongshi, The 2004 Report, pp. 23–86.

38 These documents are: “Heilongjiang laogongye jidi zhenxing zongti guihua” (“Overall planning guidelines for reviving old industrial bases in Heilongjiang: 18 November 2004”); “Liaoningsheng laogongye jidi zhenxing guihua” (“Planning guidelines for reviving old industrial bases in Liaoning: 15 January 2005”); and “Zhenxing Jilinsheng laogongye jidi guihua gangyao” (“Summary of the planning guidelines for reviving old industrial bases in Jilin: 24 March 2005”).

39 See Qing, Lu, “Zhenxing dongbei zuipa xinping zhuang jiujiu” (“The biggest worry for the ‘revive the northeast’ scheme is to put old wine in a new bottle”), Zhongguo shangbao (China Commercial News), 19 August 2003Google Scholar. Also refer to the State Council's Development Research Centre, Zhongguo jingji nianjian 2004 (China's Economic Almanac 2004) (Beijing: Zhongguo jingji chubanshe, 2004), p. 178.

40 See “Certain Opinions,” especially Parts III, IV, VI, VII, and XI; and “Dui Zhonggong zhenxing dongbei laogongye jidi zhanlue zhi fenxi” (“An analysis of the CCP's strategy of reviving northeastern old industrial bases”), Zhonggong yanjiu (Studies of Chinese Communism), October 2003, p. 51.

41 Heilongjiangsheng renmin zhengfu, “Heilongjiangsheng laogongye jidi zhenxing zongti guihua”; Liaoningsheng renmin zhengfu, “Liaoningsheng laogongye jidi zhenxing guihua”; and Jilinsheng renmin zhengfu, “Zhenxing Jilin laogongye jidi guihua gangyao.”

42 See Shiqiang, Sun, “Wajue guojia zhengce xiaoying zhenxing dongbei jingji de zhanlue fenxi” (“An analysis of strategies for utilizing the national policy of ‘reviving the northeast’”), Qianyan (Front), No. 6 (2004), p. 43Google Scholar. In addition, the central government allowed the region to shorten the depreciation period for fixed assets by a maximum of 40%. See “Luoshi zhenxing dongbei laogongye jidi qiye suodeshui youhui zhengce chutai” (“Favourable enterprise income tax policies for materializing the revival of northeastern old industrial bases are revealed”), posted at http://www.XINHUANET.com on 9 October 2004 (accessed the same date).

43 With regard to sectoral choices by the provinces, Chinese officials mentioned two points: the decisions were based primarily on comparative advantages (yindi zhiyi); and enterprises outside the key six sectors were not to be exempted from the consumption-related value-added taxes. Interviews in Beijing and Heilongjiang, February 2006. Nevertheless, overall, Liaoning appears to have received more support from Beijing since 52 of the initial 100 projects approved were assigned to Liaoning in late 2003.

44 The central government devoted funds from treasury bonds to financing the building of infrastructure and industrial upgrading in the northeast. By 2004, it had allocated 800 million yuan for interest payment on loans from treasury bonds. Guowuyuan zhenxing dongbei diqu deng laogongye jidi lingdao xiaozu bangongshi, The 2004 Report, pp. 103–104, 120, 131; and “2006 nian Zhongguo dongbei diqu fazhan baogao” (“A report on the development of the northeast region in China”), posted at http://www.readfree.net/viewarticle.php?id=275831 on 8 January 2007 (last accessed 3 March 2007).

45 Guowuyuan zhenxing dongbei diqu deng laogongye jidi lingdao xiaozu bangongshi, The 2004 Report, pp. 95, 116–17, 129.

46 Qiao Mu, Revive the Northeast, p. 21; and Li Wen and Liu Chunguang, “Explanations for the ‘revive the northeast’ strategy,” p. 11.

47 As of 2002, the NPL rate for Jilin, Liaoning and Heilongjiang was higher than the national average by 49, 17 and 5%, respectively. Shusong, Ba, “Zhenxing dongbei de jinrong zhichi zhanlue” (“Strategy of financially supporting the ‘revive the northeast scheme’”), Zhongguo jingji shibao (China Economic Times), 22 December 2003Google Scholar; and Deli, Zou and Binbin, Deng, “Ruhe chuzhi yinhang buliang daikuan” (“How to cope with bad debts of banks”), Beifang jingmao (Economy and Trade in the North), No. 7 (2004), pp. 86–88Google Scholar.

48 Qiangyi, Jin, “Zhenxing dongbei laogongye jidi yu duiwai kaifangdu” (“The scheme of ‘reviving old industrial bases in the northeast’ and the level of opening”), Yanbian daxue xuebao (Journal of Yanbian University), Vol. 38, No. 1 (2005), p. 7Google Scholar.

49 Central government officials characterize the northeast as always “waiting for, relying on and demanding Beijing's support” (deng kao yao). For the northeast's conservatism, see Chung, Jae Ho, Central Control and Local Discretion in China (Oxford: Oxford University Press, 2000), ch. 6Google Scholar.

50 Liyan, Yang, “Zhenxing dongbei ji dongbeiya hezuo guoji yantaohui zailian juxing” (“International conference on the ‘revive the northeast’ and Northeast Asian co-operation held in Dalian”), Liaoning ribao (Liaoning Daily), 26 September 2004Google Scholar.

51 Guowuyuan zhenxing dongbei diqu deng laogongye jidi lingdao xiaozu bangongshi, The 2004 Report, pp. 98–99.

52 Ibid. pp. 132–33.

53 “Jilinsheng guomin jingji he shehui fazhan di shiyige wunian guihua gangyao” (“An outline of the eleventh five-year programme of national economic and social development of Jilin province”), ch. 1.

54 Interviews in China during 2006 and 2007; and Qingwei, Shi, “Dongbei zhenxing: quyu zengzhang guaidian heshi chuxian” (“The ‘revive the northeast’ programme: when will the turning point appear?”), Banyuetan (Semi-Monthly Talks), No. 262 (2007), pp. 49–51Google Scholar.

55 Interviews in February 2006 and January 2007.

56 See “Lianggao baogao: 14 shengbu gaoguan shou chaban” (“Two Supreme Courts report: 14 provincial and ministerial senior officials were investigated and punished”), posted at http://www.irib.com/worldservice/chinese/news/06-03-13/06031336.htm on 13 March 2006, accessed the same day.

57 In 2005, the Central Organization Department dispatched 94 cadres to serve as provincial, prefectural and county leaders in the northeast. See “Zhongyang danwei he yanhai shengshi ganbu jin qi fu dongbei gongzuo” (“Cadres from central units and coastal provinces and cities sent to work in the northeast”), posted at http://www.XINHUANET.com on 15 March 2005 (accessed the same date).　

58 See Baojiang, Han, “Zhenxing dongbei xuxianzhi zhengfubing” (“Reviving the northeast should first cure the ‘government disease’”), Zhongguo jingji shibao (China Economic Times), 5 March 2004Google Scholar; Gang, Wang, “Zhenxing dongbei zhili xianxing” (“Disciplining officials must precede in reviving the northeast”), Zhongguo xinwen zhoukan (China News Weekly), 25 October 2004, pp. 26–28Google Scholar; and “Jilin kuaipao beihou de ‘Wang Min shudu’” (“Wang Min's speed behind Jilin's sprint”), at http://news.sina.com.cn/c/2007-03-01/095412400380.shtml (last accessed 5 March 2007).

59 The 2006 data on Liaoning are from Liaoningsheng renmin zhengfu, Zhengfu gongzuo baogao 2007.

60 See Liaoning tongji nianjian (Liaoning Statistical Yearbook) 2006, p. 405. It is not clear why this has been the case. A speculative answer may be that the so-called “initial policy effects” evaporated after 2005. According to our interviewees, the provincial authorities were indeed asking Beijing to provide more preferential FDI guidelines for Liaoning. Interviews in Shenyang in December 2006.

61 Liaoning ribao, January 8, 2007; Liaoning Statistical Yearbook 2006, p. 27; and Shaofeng, Cao et al. , Liaoning jingji shehui xingshi fenxi yu yuce 2006 (Analysis and Forecast of Liaoning's Economic and Social Development for 2006) (Beijing: Shehuikexue wenxian chubanshe, 2006), p. 14Google Scholar.

62 The 2006 data on Jilin are from Jilin tongjiju, Jilin sheng guomin jingji he shehui fazhan tongji gongbao (Bulletin of Statistics on National Economic and Social Development of Jilin Province 2006), posted at http://www.stats.gov.cn (accessed 28 February 2007).

63 China Statistical Yearbook, various years; Jilin tongji nianjian (Jilin Statistical Yearbook), various years; Jilinsheng guomin jingji she shehui fazhan tongji gongbao; and Jilin sheng guomin jingji shehui fazhan tongji gongbao, 2005, 2006, posted at http://www.stats.gov.cn (accessed 28 February 2007).

64 Jilin renmin zhengfu, Zhenxing Jilin laogongye jidi guihua gangyao (An Outline of the Programme for Reviving Jilin's Old Industrial Base), posted at http://www.chinaneast.gov.cn on 24 March 2005, accessed 24 February 2007.

65 Interviews with provincial officials and scholars in Jilin in September 2006.

66 See “Jilin sheng gaoxin jishu qiye cheng jiqunhua fazhan qushi” (“High-tech enterprises in Jilin province show a tendency of developing in clusters”), Jilin ribo (Jilin Daily), 9 January 2006, posted at http://www.emanu.cn/ariticle.php?id=1344 (accessed 3 March 2007).

67 Interviews in Harbin in February 2006.

68 Heilongjiang tongji nianjian 2006 (Heilongjiang Statistical Yearbook 2006 (Beijing: Zhongguo tongji chubanshe, 2006), p, 37; and Heilongjiang sheng guomin jingji he shehui fazhan tongji gongbao posted at http://www.stats.gov.cn (accessed 6 April 2007).

69 Heilongjiang Statistical Yearbook 2006, pp. 398, 409.

70 Interviews in Harbin in February 2006.

71 Heilongjiang Statistical Yearbook 2005, p. 264 and 2006, p. 277.

72 Heilongjiang zhenxing bangongshi (Heilongjiang Office for Reviving the Northeast), “Heilongjiangsheng zhenxing laogongye jidi gongzuo jinzhan qingkuang” (“Current conditions of reviving the old industrial bases in Heilongjiang”), 20 February 2005, pp. 2–3.

73 See Heilongjiang sheng guomin jingji she shehui fazhan tongji gongbao.

74 Zhenxing dongbeiban, “Dongbei zhenxing sannian pinggu” (“Assessing the first three years of the ‘revive the northeast’”) at http://chinaneast.xinhuanet.com/2007-05/23/content_10091405_11.htm (last accessed 26 June 2007).

75 Feng, Xu, “Dapi zhongyang he yanhai guanyuan kongjiang dongbei” (“A large number of officials from the central government and coastal regions are parachuting into the northeast”), Nanfang zhoumo, 24 March 2005Google Scholar; and Hongyi Lai, Reform and the Non-State Economy in China, chs. 4–5.