China's West: Generating Change

By LAN XINZHEN

OVER a century after droves of Americans were heading to the western states to seek out new opportunities, the Chinese government launched its own campaign to put Western China onto a fast development track. By 2010, thanks to the Western Development Program, the pace of economic growth there overtook that of the eastern coastal region to become a new economic engine in China.

This comes as wholly welcome news for a country with great regional disparity in economic growth.

What do we mean by Western China? Its physical area accounts for 71.4 percent of the country, extending for 6.85 million square kilometers. It embraces the provinces of Shaanxi, Gansu, Qinghai, Sichuan, Yunnan and Guizhou; Ningxia Hui, Xinjiang Uygur, Tibet, Inner Mongolia and Guangxi Zhuang autonomous regions; and the municipality of Chongqing. Western China is home to 356 million people, 28.6 percent of China's total population. Minority ethnic groups constitute the main part of the region's population: in fact, some 75 percent of China's ethnic minority people live here.

Western China boasts particularly rich natural resources. About 82.5 percent of China's hydropower resources are concentrated here, but less than one percent has yet been exploited. Among the 140 minerals proven to exist in China, over 120 have been discovered here: coal reserves account for 36 percent of the national total, oil for 12 percent, and natural gas for 3 percent. Western China is ahead of the rest of the country, even the world, in its reserves of sought-after metals such as rare earth.

At the turn of the 21st century Western China still remained inaccessible, with a laggardly economy; it could be characterized as poverty-stricken and backward. But by 2010 huge changes had taken place. Perhaps the most striking transformation is the advent of expressways connecting provinces and cities. Gone is the reliance on the donkey- or horse-drawn carts of yesteryear that were the most common modes of transport. If you want to see these, you'll have to go to tourist centers or movie locations for shooting the "olde worlde" version of Western China.

Guizhou's Taijiang Wind Farm has become a popular tourist draw.

A Ten-year Economic Leap

It is a huge source of pride for the people of Chengdu, capital of Sichuan Province, that of all the laptops sold or in use in the world today, half incorporate an Intel core made in their city.

After establishing a representative office in Beijing in 1985, Intel made its first large-scale investment in 1996 with the setting up of its first chip assembly and test site in Pudong, Shanghai, consequent to the Chinese government policy of developing the eastern littoral. Five years later the planning of Intel's second assembly plant coincided with the government's announcement of its Western Development Program. This decided Intel to make a westward shift. In 2003 Intel Products (Chengdu) Co., Ltd. was established and it now assembles and tests 60 percent of Intel's global output, having absorbed the Shanghai assembling and testing functions in 2009.

Chengdu is the only location in the world to test and assemble Intel's recently launched second-generation Intel Core 2 Duo processor. Within just six months, Chengdu became the only place in the world to make this product.

Intel is just one of many world-famous companies to take up a presence in Western China. According to the Western China Department of the National Development and Reform Commission (NDRC), since the inception of the Western Development Program over 70 percent of the world's top 500 companies have made profitable investments here and have pushed forward economic development.

China's reform and opening-up began in 1978. It was spearheaded by and focused for the first two decades on the eastern coastal area and created a north-south swathe of rapid economic development. By the mid- to late-1990s, China's GDP had doubled. Its share in the global economy rose from 0.7 percent in 1977 to 7.3 percent in 2009. Despite this staggering economic success story, the pace of development was very different between east and west China, engendering an economic gap that yawned wider with every passing year. Therefore, in 1995 the government announced that the focus for the next 15 years would be on balanced regional development and shrinking the gap.

In 1999 the Chinese government put forward its Western Development Strategy, signaling economic expansion into China's interior. The central government offered a raft of preferential policies in terms of investment, land use and human resource. Now several economic circles have emerged in China's West, among them Guanzhong-Tianshui, Lanzhou-Xining-Yinchuan, Hohhot-Baotou-Ordos, Nanning-Liuzhou, Pan-Beibu Gulf and Chengdu-Chongqing.

The financial crisis gave the global economy a pounding in 2008, but China came out of the crisis pretty rapidly, and its economy has been one of the few to maintain vigorous growth. The Western China contribution has much to do with this performance. The 2009 GDP growth rate table showed a reversal of the trend of the coast growing faster than the hinterland: for the eighth year running Inner Mongolia headed the pack with a growth rate of 16.9 percent, and the national average growth rate of 8.7 percent was conspicuously surpassed by Chongqing, Sichuan, Guangxi and Shaanxi with increases of 14.9 percent, 14.5 percent, 14 percent, and 13.6 percent respectively.

But one should not assume Western China has caught up and that the problem is sorted. In the first half of 2010 Western China's GDP accounted for only 18 percent of the national figure, and the average income lagged far behind that of Eastern China.

Enviable Cultural Heritage

Gansu Province is comparatively poor in economic terms, but its Mogao Grottoes at Dunhuang are a magnet for scholars and tourists from all over the world. It was in these frescoed caves in 1900 that a local Taoist priest accidentally discovered a hoard of ancient documents, paintings on paper and silk and embroidery dating from the fourth to 11th century AD – some 50,000 items in all. Many of these precious relics are still in the collections of the British Museum and National Library of France. The treasures of Dunhuang are a miracle of world cultural history, a showcase of exquisite ancient Chinese art and culture.

But as one of birthplaces of Chinese civilization, ancient relics abound and astound right across Western China: the terracotta warriors, the imperial tombs of the Western Xia, the site of ancient Loulan state, the Potala Palace, and the remains of 3,000-year-old Sanxingdui city are just the tip of a huge archeological iceberg.

Western China, as a gateway to central and west Asia, witnessed the earliest beginnings of trade across the landmass, the meeting and mixing of peoples, all of which have left their mark on this vast area.

Home to dozens of ethnic groups over the long march of time, its many different languages, religions, animism, mythologies, legends, songs and dances make Western China a place of great diversity, which is evidenced in disparate feast days, dress, architecture, crafts, conventions, lifestyles and livelihoods. The variety gives Western China a very special magic.

Geographically and culturally, these vast territories can be divided up into a number of large "cultural families" – the Loess Plateau culture along the Yellow River; the Islamic culture of the Northwest, the grassland culture of the North, the Western Regions culture of the Tianshan range, the Tibetan culture of the Qinghai-Tibet Plateau, the Bashu culture of the Sichuan Basin and the upper/middle reaches of the Yangtze; and the Dianqian culture of Yunnan and Guizhou provinces.

Environmental Problems Addressed

In the middle and late 1990s sandstorms in Northern China deposited tons of sand in Beijing and other cities; this ecological wake-up call forced a recognition of the social and economic implications of environmental degradation. The culprit was the deteriorating environment in Western China, and the government realized that remedial action was urgently needed.

In 2000 the government launched a raft of projects in Western China, such as returning farmland to forest, banning herding from grassland, protecting natural forest and controlling sandstorm sources. That same year it stopped commercial felling of natural forest and stepped up the pace of afforestation in the region.

In the last decade, the 12 provinces (autonomous regions, municipality) in Western China have planted 30.65 million hectares of forest, and the central government's accumulated investment into eco-improvement has reached RMB 217.22 billion.

Figures from the NDRC's Western China Department show that forest coverage increased by 6.73 percentage points within the space of ten years, and that forest stock volume increased by nearly 1.3 billion cubic meters. With greater forest coverage and control measures, there was a concomitant reduction in the area affected by soil erosion and desertification; the result was a clear improvement in the ecological situation and farmer's living conditions.

In some regions of serious degradation like Inner Mongolia, Shaanxi, Gansu and Ningxia, the area of desertified land is 7,921 sq kilometers less than in 1999. In Sichuan, the project of returning farmland to forest has helped cut soil erosion by 320 million tons and to conserve 28.8 billion tons of water over a 10-year period, greatly reducing the quantity of silt carried into the Yangtze along its major tributaries.

The NDRC said that in future west-directed investment would focus on developing infrastructure, the eco-environment and technical education, with an eye to major breakthroughs in infrastructure and ecological environment within five to 10 years.

The area of soil erosion in all of China amounts to 3.56 million square kilometers; 4.5 billion tons of soil are lost to erosion annually, equivalent to 6,666 hectares of arable land.

Blueprint for the Future

The year 2011 sees the launch of China's 12th Five-year Plan for Economic and Social Development. An NDRC official has disclosed that Western China is planned to become an important base for energy, downstream processing of resources, manufacturing and emerging strategic industries. According to the preliminary plan of the NDRC, the 2015 GDP of Western China will double the 2008 figure.

The natural conditions of Western China determine that emerging clean energy sources will make wind and solar power key industries in the region.

Western China shares a border with a dozen countries, an advantage when it comes to developing border trade. Xiao Jincheng, deputy director of the Institute of Spatial Planning & Regional Economy Research, Academy of Macroeconomic Research of NDRC, said that the Western Development Program will choose new economic growth poles like Kashgar and Korgas, both of which are border ports connecting to the markets of central and western Asia and of Europe.

Constraints on space and other factors are limiting the scope for expansion in Eastern China. Many companies originally located here (Intel is a prime example) have moved westward, prompted by the cost of manpower and by economic changes. The new trend means the East will maintain steady growth within a certain range but with no more big surges. Western China, on the other hand, is sucking in more and more business investment, thanks to its advantages of available land, labor, preferential policies, and much improved communications infrastructure. The support of new western-focused policies will put the region on a high-speed development track, and its people can expect the arrival of great improvements in their environment, social development and living standards.