Economy Jun 02

China redraws political map to aid mega-city growth

Powers to be transferred from regions neighbouring Shanghai, Beijing and Guangzhou in bid to expand their economies and influence

China redraws political map to aid mega-city growth
Shanghai is among a handful of so-called mega cities that will assume development powers over come neighbouring regions. 

(ATF) Chinese officials plan to redistribute political powers in major development regions to streamline their integration into economic powerhouse mega-cities.

The schemes will essentially see Beijing, Shanghai and Guangzhou take over the running of parts of neighbouring provinces to coordinate their economic and social expansion and in effect redraw China’s administrative map. 

The sprawling integration of the Beijing-Tianjin-Hebei region, the Guangdong-Hong Kong-Macau Greater Bay Area, and the Yangtze River Economic Belt into economic regions with greater autonomy is a key part of China’s overall economic development plan.

Cong Liang, Secretary-General of the National Development and Reform Commission (NDRC), said that the huge impact of the coronavirus epidemic had accelerated the implementation of regional development strategies. Administrators’ focus is now on promoting regional coordinated development, harnessing growth momentum. 

China has already begun selling trillions of yuan in bonds to fund the schemes, which will also absorb the huge numbers of people made unemployed by the economic shock of the virus.

"In 2020, China's regional development will be further strengthened," Liu Yunzhong, director of the development strategy of the State Council's Development Research Center and the Research Office of the Regional Economic Research Department, said in an interview with the Economic Reference News. The development of regions according to their comparative advantages will improve the overall efficiency of regional economic development and stimulate regional vitality.

Cong said that last year, the GDP of the Beijing-Tianjin-Hebei, Yangtze River Delta and Guangdong-Hong Kong-Macau Greater Bay Areas reached 8.5 trillion yuan, 23.7 trillion yuan and 11.4 trillion yuan, respectively, accounting for 44% of the country’s total economic productivity. 

Growth ‘engine' 

They have become the “engine” of China's economic development, Cong said, adding that to achieve high-quality regional economic development, “we must give full play to the leading role of these three power sources.”

On May 30, the Zhaodian-Huangdu section of the Tonghu Railway was officially put into trial operation, and Taicang, Changshu, Zhangjiagang and other regions were officially connected to the Yangtze River Delta railway network. These came under the purview of the Outline of the Yangtze River Delta Regional Integration Development Plan.

Core to the mega-cities plan is the construction of new infrastructure, the severance of geographical constraints and administrative barriers between the regions in order to give play to their respective advantages. 

According to the Economic Reference News, the first of these "cross-provincial statutory spatial plans" – that of the Yangtze River Delta Integration Demonstration Zone – has entered the final stage of improvement. It envisages the close integration of Shanghai, Jiangsu, and Zhejiang provinces, giving Shanghai powers over multiple administrative regions – or "one blueprint governing the entire territory".

According to the plan announced by the NDCR, the scope of the integrated demonstration zone includes Shanghai Qingpu District, Wujiang District, Suzhou City, Jiangsu Province, and Jiashan County, Jiaxing City, Zhejiang Province. The zone covers an area of approximately 2,300 square kilometers.

In the Guangdong-Hong Kong-Macau Greater Bay Area, companies including Huawei, Baidu, JD.com, Hong Kong Xinhua, and others, have signed a cloud contract to lay out the development of the "new infrastructure" in the region. According to Gao Yuyue, deputy secretary general of the Guangzhou Municipal Government, the first batch of 73 major digital new infrastructure projects has a total investment of about 180 billion yuan.

In the Beijing-Tianjin-Hebei region, Hebei Province has recently issued the Hebei Province Digital Economy Development Plan (2020-2025), which proposes the construction of the Xiong'an National Digital Economy Innovation Development Pilot Zone to foster the region’s digital economy. 

Zhao Wenfeng, deputy director of the Hebei Provincial Development and Reform Commission, said the pilot zone will trial the construction of smart cities, digital networks and institutional mechanisms to create a high-tech national leader.

Similar schemes have emerged elsewehere in China. The Chengdu-Chongqing-Shuangcheng Economic Circle recently established its first development fund. According to reports, the first phase of the fund is planned to be 10 billion yuan, and it will operate according to a market-oriented mechanism, focusing on strategic emerging manufacturing industries such as integrated circuits, smart manufacturing, new displays, new materials, new energy, biomedicine and other integrated circuits in Sichuan and Chongqing. 

READ MORE: More reforms planned to bolster recovery

READ MORE: Shanghai pilot scheme for short-term corporate bonds