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Covering: Guangxi, Yunnan, Guizhou, Sichuan CENTRAL POLICY UNIT HONG KONG SPECIAL ADMINISTRATIVE REGION CONSULTANCY STUDY ON SOCIAL, ECONOMIC AND POLITICAL DEVELOPMENTS IN THE PAN-PEARL RIVER DELTA (PRD) REGION THE TENTH MONTHLY REPORT COVERING GUANGXI, YUNNAN, GUIZHOU, SICHUAN March 2007 Social, Economic and Political Developments in the Pan-PRD Region Guangxi, Yunnan, Guizhou, Sichuan (10th Report / March) Table of Contents Abstract................................................................................................................... 1 1. The Impact of the Chengdu-Chongqing Economic Zone and Regional Economic Co-operation ......................................................................................... 6 1.1 The Chengdu-Chongqing Economic Zone: An Introduction.................... 6 1.1.1 Background........................................................................................ 6 1.1.2 The Birth of an Idea........................................................................... 7 1.1.3 The Chengdu-Chongqing Economic Zone and the National and Regional 11th Five-Year Plans........................................................................ 10 1.2 Urban Planning and Transportation Networks in the Chengdu-Chongqing Economic Zone .................................................................................................. 12 1.2.1 The Urban Landscape in the Chengdu-Chongqing Economic Zone12 1.2.2 The Transportation Network of the Chengdu-Chongqing Economic Zone .......................................................................................................... 14 1.3 Chengdu and Chongqing as Central Cities ............................................. 20 1.4 The Impact of the Chengdu-Chongqing Economic Zone on the Southwestern Region and Pan-Pearl River Delta (PRD) Economic Co-operation ................................................................................................................. 22 1.5 Policy Suggestions .................................................................................. 24 2 Trends and Updates on the Four Southwestern Provinces/Region ......... 25 2.1 Economic Performance of the Four Southwestern Provinces/Region.... 25 2.2 Trends and Updates on Sichuan Province - Attracting High-Quality Foreign Investment............................................................................................. 25 2.3 Trends and Updates on the Guangxi Zhuang Autonomous Region – Developing a Major Car Manufacturing Base ................................................... 32 2.4 Trends and Updates on Yunnan - Expanding Customs ports ................. 44 2.5 Trends and Updates on Guizhou - Japanese Loans Pay for Environmental Conservation and Social Development Projects ................................................ 51 i Social, Economic and Political Developments in the Pan-PRD Region Guangxi, Yunnan, Guizhou, Sichuan (10th Report / March) 3 Regional Co-operation: The Pan-Beibu Gulf Economic Zone and Rise of Guangxi................................................................................................................. 58 Appendix：........................................................................................................... 71 Appendix I：Statistical Data for the Pan-PRD Provinces/Region .................... 71 Appendix II：English-Chinese Glossary........................................................... 72 ii Social, Economic and Political Developments in the Pan-PRD Region Guangxi, Yunnan, Guizhou, Sichuan (10th Report / March) Abstract 1 The Impact of the Chengdu-Chongqing Economic Zone on the Four Southwestern Provinces/Region and Pan-Pearl River Delta (PRD) Co-operation 1.1 In March 2007, the State Council issued the 11th Five-Year Plan for the Western Development Programme, in which the Chengdu—Chongqing Economic Zone was listed as one of the key regional development programmes. The Chengdu—Chongqing Economic Zone, with Chengdu and Chongqing as its backbone, covers 33 cities across Sichuan. Its future economic development will be driven mainly by the three major city clusters around Chengdu, Chongqing and southern Sichuan. 1.2 Chengdu and Chongqing coordinated their transport planning systems, when it came to devising their own respective 11th Five-Year Plans. Newly constructed roads and railways will be connected with their counterparts’ routes leading out of the province, and related projects are scheduled to be finished by the end of the 11th Five-Year Plan period. By then, Sichuan and Chongqing will possess the most advanced transportation network in western China. Meanwhile, the Cuntan International Container Terminal in Chongqing is strengthening waterway co-operation along the Yangtze River between Sichuan and Chongqing, and is bestowing benefits to the southwestern provinces in the PRD region. 1.3 Chengdu and Chongqing will push forward the transfer of national defence technology from the military to civil sectors. This will raise the technological development of the two cities well above Guangzhou, the core city in the Pan-PRD region, and stimulate the development of their knowledge industries. 1.4 Sichuan may be less keen to engage in Pan-PRD regional co-operation now that the Chengdu—Chongqing Economic Zone has been brought into the Western Development Programme. The development of transportation systems in Chengdu and Chongqing has made Sichuan a 1 Social, Economic and Political Developments in the Pan-PRD Region Guangxi, Yunnan, Guizhou, Sichuan (10th Report / March) passenger and cargo distribution centre as well as a regional centre in southwestern China, which may draw Yunnan and Guizhou closer to them. Meanwhile, Guangxi intends to speed up the development of the Pan-Beibu Gulf Region. Therefore, the latest developments in the southwestern region are likely to impact on Pan-PRD co-operation. 1.5 Hong Kong should work together with different provinces in accordance with their distinctive features. For instance, it should help Guangxi and Yunnan develop their international service industries, and co-operate with Sichuan and Guizhou on specific industries. The transference of Sichuan’s national defence technology, from the military to the civil sector, may present Hong Kong with an opportunity. Hong Kong public institutions may collaborate with their counterparts in Sichuan on technology transfer and applications. 2 Trends and Updates on the Four Southwestern Provinces/Region 2.1 Sichuan Province-Sichuan Attracts Investments from High Quality Foreign Business 2.1.1 With its abundant natural resources, low production costs, advantageous geographical position and preferential policies, Sichuan has attracted investment from world-class corporations, including Intel, Toyota, Nokia and Citibank. This has spurred growth in its manufacturing, information technology, financial and logistics industries and boosted foreign trade. 2.1.2 Hong Kong’s investment in Sichuan is largely concentrated in the real estate industry. Recently, the Central Government released a series of policies to cool down the over-heated real estate industry, which require local governments to regulate the local real estate market and curb excessive price surges. Therefore, investment by Hong Kong enterprises in the Mainland real estate industry is unlikely to receive encouragement from the Central and local governments. 2 Social, Economic and Political Developments in the Pan-PRD Region Guangxi, Yunnan, Guizhou, Sichuan (10th Report / March) 2.1.3 Hong Kong enterprises should diversify their investments on the Mainland into areas such as finance, insurance and logistics services, rather than focus excessively on the real estate industry. 2.2 Guangxi Zhuang Autonomous Region - Guangxi Becomes a Heavyweight Auto Producer 2.2.1 Led by its foremost automaker, Liuzhou Wuling Motors Co. Ltd, Guangxi has transformed itself into one of the most important auto production bases in China by targeting the mini-vehicle market. Guangxi accounts for a significant share of China’s mini-vehicle market, and also exports vehicles and invests abroad. Guangxi’s auto industry is well positioned in the market, but has experienced some problems, such as the scale of small enterprises, a far from optimised vehicle product structure, lesser competence in the auto parts sector and independent technology development. 2.2.2 Hong Kong’s technological capabilities could be integrated into Guangxi’s mini-vehicle supply system. Hong Kong could work with Guangxi’s enterprises on environmental protection, and on energy and power engineering devices, by introducing foreign technologies. 2.2.3 Hong Kong may send students on work placements in Guangxi, and allow staff from Guangxi’s enterprises to train in Hong Kong at the same time. 2.2.4 Hong Kong enterprises, and the appropriate technology research and development agencies should conduct research on Guangxi’s auto industry, and seek business opportunities. 2.3 Yunnan Province - Yunnan Strengthens Port Construction 2.3.1 The Yunnan Provincial Government plans to upgrade seven ports, including Pianma (片馬), Yingjiang (盈江) and Zhangfeng (章鳳), from category-2 to category-1 status. International airlines are also likely to 3 Social, Economic and Political Developments in the Pan-PRD Region Guangxi, Yunnan, Guizhou, Sichuan (10th Report / March) start servicing Lijiang. Local governments have been accelerating port construction with the support of the Central Government, in the hope that the upgraded ports will strengthen their external ties and stimulate imports and exports. They have
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