Investment in western China tripled in 2012

By Liu Sha Source:Global Times Published: 2012-12-21 0:50:06

China has invested 577.8 billion yuan ($91.91 billion) in key infrastructure projects in underdeveloped western regions in 2012, the country's top economic planner said Wednesday.

As a continuation of its decade-long bid to narrow the gap between the remote inland areas and the bustling coastal regions, investment this year is almost triple that of 2011.

According to the National Development and Reform Commission (NDRC), 22 major projects have been launched this year, including railways, highways, airports, power plants, gas pipelines and steel plants, Xinhua reported.

China has invested a total of 3.68 trillion yuan to support its western development strategy, a policy adopted in 2000 by the State Council.

According to the figure released by the National Bureau of Statistics at the end of 2011, the western region, with 12 provinces and regions and home to 22.9 percent of China's population, has fallen behind in terms of per capita GDP, social development and scientific innovation when compared to the central and eastern parts of China.

"The widening wealth gap between eastern and western regions will cause instability, especially in areas where ethnic groups are concentrated, such as Guizhou Province, the Xinjiang Uyghur Autonomous Region and the Tibet Autonomous Region," Zhang Baotong, vice director of the academic committee of the Shaanxi Academy of Social Sciences, told the Global Times Thursday.

In those areas, legal and economic problems like corruption could be turned into sensitive ethnic minority or political issues that could affect regional or even national stability, so the government should try hard to increase wealth to reduce conflicts, Zhang said.

Some 187 major projects have been launched in the last 12 years and most of them are basic constructions such as roads and railways.  However, some experts are raising doubts over the continuous road and railway construction in western China.

"Most of the construction projects are State-owned.  Why couldn't they open the market more and give more chances and freedom to private enterprises?" an agricultural official surnamed Hu working in the provincial government of Guizhou, one of the western provinces, told the Global Times.

Hu said investment from the central government is helpful, but the underdeveloped west also needs more favorable policies that are currently enjoyed by coastal cities, such as tax cuts and more open markets.

He also pointed out that the huge injection of State money could be misused in western regions because of corruption.

However, Zhang argued that this was a result of a lack of funds in other areas in the western regions.

According to Zhang's research, some officials in Shaanxi have withheld the money from the central government and used it to cover other public expenses such as building social welfare houses due to a severe lack of revenues.

Nevertheless, figures from the National Bureau of Statistics show that though the GDP in the west was lagging behind, the growth rate in western China, including economic, ecological and social development, ranked first compared to central and eastern China.

The effect of those projects would not be seen completely until a more convenient transport network is established to help local businesses, Zhong Dajun, a macro-economist at Peking University, told the Global Times.

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