Development in North East People's Republic of China

Abstract

Since the government announced the Revitalise the North East policy in 2002 there has been a new focus to regional policy following on from the previous, but continuing, Develop the West policy. For a variety of historical reasons the three provinces of North East China, Heilongjiang, Jilin and Liaoning, also known collectively as Inner Manchuria or Dongbei pose quite different challenges for regional policy as compared with the backward Western provinces. The North East is the old heavy industry centre of the country and as such retains a strong SOE presence. In the post war period initially with Soviet aid it became the part of the People’s Republic of China (henceforth PRC) that most closely resembled the Soviet Union in industrial organization and production structure with a focus on heavy industry and mineral exploitation. Its share of national industrial output in 1940 was as much as one third. This fell to 17% in 1978 at the beginning of the reforms to less than 10% in 2004. Historically the region has not been poor by national standards. In terms of GDP per capita Heilongjiang and Liaoning were among the richest provinces in 1978. This position has been eroded over time with the fast growth in the coastal provinces, but in 2004 GDP per capita was about a third above the national average and twice the figure in the poorer Western provinces. The disparity within the north-east can be seen from the fact that the province of Liaoning has a per capita income more than 50% above Jilin and roughly 20% above Heilonjiang.