Guizhou Picks up the Pace

COVERING a land area slightly larger than the U.S. State of Florida, Guizhou is home to multiple ethnic minorities in southwestern China. Despite having traditionally been known as a lessdeveloped region, nowadays Guizhou is proving its economic and developmental mettle.

Although the province got in the growth game comparatively late, Guizhou is making some remarkable achievements in economic and social development and is now enjoying its best growth streak since the start-up of reform and opening-up. A lot of this growth has been since the Chinese government inaugurated its highly successful “West Development” drive in the hinterlands of the country.

New Path in Industrialization

Guizhou is rich in natural resources, especially in the complementary combination of hydropower and coal. The province has 984 rivers that stretch more than 10 kilometers in length or have at least a 20-square-kilometer water catchment area. Its coal reserves amount to about 50 billion tons, making it an important province for the national “West to East Electricity Transfer” project. A total of 128 minerals have been found in the province, among which 76 have been found in sufficient quantities to meet energy resource needs. Overall, Guizhou is a favorable place for mineral exploitation.

Guizhou’s abundant resources mean great development potential for the province. The central government considers speeding up development in Guizhou an important task to maintain ethnic unity and social harmony in the region – more than one third of the province’s residents belong to ethnic minorities. With an eye on sustainability, Guizhou has chosen a new path of industrialization that does not sacrifice the environment in exchange for economic gain. The principle is to guide industrial development and preserve the province’s unique ecology.

A small economy and a lack of industrial technology are the two prominent problems in Guizhou. The province is confronted with the dual task of accelerating development to increase output and transforming its economy to encourage modern industry.

In order to probe a new path to industrialization with Guizhou characteristics, the province is focusing on strategic adjustments to its economic structure based on technical progress and innovation. To date, Guizhou has quickened its industrial transformation and been switching from just digging up and selling raw materials to deeper processing.

Changes have also been taking place beyond the mineral sector. The Digital Content Industry Park in Guiyang, the provincial capital, specializes in software research and development, animated films and TV programs, Internet gaming, and other digital derivatives. By offering assistance in training, financing and international exchanges and running a full gamut of facilities and services, the industrial park has attracted a number of top innovative companies to set up offices there. The park aims to expand its asset value to RMB 100 billion by 2015 and become an important inland base for the software industry in China. Longmaster Information & Techonology Co., Ltd, Xidu Internet Media Technology Co., Ltd. and a number of other reputable domestic enterprises have a presence in the park; the formation of an industrial cluster is well underway.

Relying on its strength in resources and solid industrial base, the provincial government has given strong support to expanding key competitive industries. By developing electricity, coal, alcohol and equipment manufacturing, the province has further enhanced its industrial capacity to realize fast economic growth. In transforming and upgrading traditional industries, Guizhou has also raised its industrial competitiveness in building materials, the chemical industry, metallurgy and forestry. By integrating technical innovation and industrialization, Guizhou is not just planning to expand emerging industries, but is already seeing decent progress. And all the while, this industrial development is taking place against a backdrop of energy conservation and environmental protection.

Businesses are being encouraged to“go green.” For instance, Huaneng Coking Gas Manufacturing Co., Ltd. has now provided coal gas to 1.6 million people and some 2,000 enterprises in Guiyang, marking a farewell to coal burning. The provincial capital has had no acid rain since 2009. In 2011 the city won the title as the country’s most livable city, according to China Institute of City Competitiveness.

Last year, industrial parks in Guiyang turned down a number of investment projects worth over RMB 30 billion that would have been high in energy consumption and pollution.

In Bijie, a city in northwestern Guizhou, five indusial parks have been championing the concept of green, circular economy by developing the coal chemical industry, the phosphorus chemical industry and building materials industry – all without polluting the environment.

Poverty Alleviation

“Poverty and underdevelopment are two major problems Guizhou should address in order to realize balanced prosperity,” said Du Ying, vice minister of National Development and Reform Commission (NDRC), at a press conference earlier this year outlining the central government’s plans to promote growth in the region.

Guizhou has long lagged behind China’s regional economic powerhouse in economic and social growth. Provincial GDP in 2011 was RMB 570.2 billion, while its neighbor to the north, Sichuan Province, boasted a GDP of RMB 2 trillion the same year. The net output of Chengdu, Sichuan’s capital, was RMB 685.4 billion, exceeding the GDP of the whole of Guizhou Province.

By 2015, Guizhou needs to double its GDP per capita to approach the western region average of around US $5,000, according to a document issued by the State Council in January. The 2011 GDP per capita in Guizhou is only half the anticipated sum, standing at about one sixth of that in Shanghai, the country’s most developed area.

Since China raised its national poverty line to RMB 2,300 last year from RMB 1,274 in 2010, Guizhou now has about 11.49 million people living in official poverty – 9.4 percent of the national total. Fighting poverty is a tough battle here.

According to Hu Jicheng, vice director of the agricultural committee of the province, during the course of poverty alleviation, Guizhou will pursue a plan based on the situation on the ground. To advance on a village-by-village level to propel industralization has become the new feature of Guizhou’s poverty alleviation efforts.

“The merits of advancing at the village level lie in the ability to pool various resources. Starting small and slowly building up the scale of industry can and will make big contributions to poverty reduction,” said Hu Jicheng.

As part of its poverty alleviation efforts, Guizhou will invest RMB 1.2 billion this year in a program to relocate 1.5 million poor villagers from rocky areas unfit for human habitation.

“The direction of migration consists of two parts: one is to cities, and the other is to areas of mature industrial sectors,”Hu said. Of those who are relocated, elderly will be granted pension insurance, those of working age will be supplied with employment, and young people will be offered vocational training.