August 1, 2010｜China
Professor, College of Economics, Ritsumeikan University
According to all manner of reports, from last year and into this China has been developing a new policy toward international regional economic cooperation straddling national boundaries, namely the construction of an international cross-border economic region.
The establishment of the “Suifenhe Integrated Free Trade Zone” (approved by the State Council in April 2009); area: 1.8 km2. Making best use of its favorable geographic location and constructing transportation routes connecting China, Russia, Japan and the ROK by land and sea, they are aiming at developing it as a Northeast Asian international trade center and an integrated import and export goods processing area. It has been reported that the basic facilities have been completed, and that nine firms have signed agreements to set up in business (Xinhuanet Heilongjiang channel, 7 May 2010; NPO Niigata Japan–China Friendship Association “China Heilongjiang Province Socioeconomic Situation Database”).
Formulation of the “Cooperation and Development Planning Outline of the Tumen River Area of China: Setting Changjitu [Changchun–Jilin–Tumen] as the Development and Opening-up Pilot Area” (approved by the State Council in August 2009, and officially approved and announced in November 2009). New content was: the expansion of the coverage of the program to a region of 73,000 km2 and a population of 10.9 million from Hunchun to Changchun; and the encouragement of the attempt at seeking and pursuing opening-up to the outside world, conceding the right for priority trial to the target area. Hoped for is the doing away with the systemic impediments which are a bottleneck for cooperation on development in the Tumen River Area, overcoming the problems of the restrictions on industrial development and international cooperation owing to the smallness of the cities, and promoting exchange with other countries and economic and technological cooperation. As specific items the following have been conceptualized: the international, cooperative putting in place of and upgrading of infrastructure, such as the Hunchun Border-Crossing International Commodity Trading Center and China–Russia–ROK–Japan transportation linking sea and land; the construction of a Cross-Border Economic Cooperation Zone and of an International Industrial Cooperation Park; and across-the-board strengthening of exchange and cooperation in such areas as the environment, education, culture, and tourism with all of the countries in the Tumen River Area. Targets have been set to attain the leading level nationwide, quadrupling the economic scale of the program’s target area by 2020 (Zhenxing Dongbei wang [Revitalizing the Northeast Net]: http://www.chinaneast.gov.cn, 16 November 2009).
The program, although being a Chinese one, was extended by ten years (to 2015) and in addition has a content in line with the decision of the Consultative Commission of the Greater Tumen Initiative by the five nations concerned in September 2005 to expand the target for development to the Greater Tumen Region (the three northeastern provinces and the Inner Mongolia Autonomous Region in China, the Rason economic and trade zone in the DPRK, the eastern part of Mongolia, the eastern coastal cities of the ROK, and part of Primorsky Krai in Russia).
Publication of “Opinions of the State Council on Further Implementing the Strategy of Revitalizing the Old Industrial Bases Including Northeast China” (September 2009, State Council Document  No. 33). In August 2009 a meeting was held presided over by Premier Wen Jiabao (Zhu Yonghao, ERINA Report Vol. 91, January 2010, pp. 94–95), and in addition to the results of the strategy since 2004, issues such as improvement of the structure of the economy and business reorganization for the establishment of a modern industrial structure have been brought up. The further expanding of opening to the outside world was raised as an item in its conclusion, and along with the construction of the Liaoning coastal economic belt, items were specified including the construction of the above-mentioned Changchun–Jilin–Tumen Development and Opening-Up Pilot Area and Suifenhe Integrated Free Trade Zone, and research into the putting in place of a China–Russia regional cooperative development fund (Zhenxing Dongbei wang [Revitalizing the Northeast Net], 11 September 2009).
The “Program of Cooperation between the Northeastern Region of the People’s Republic of China and the Far Eastern and Eastern Siberian Regions of the Russian Federation (2009–2018)” was signed by President Hu Jintao and President Dmitry Medvedev (September 2009), and the implementing of 205 joint projects in the border areas over a ten-year period to 2018 were confirmed. As initial projects the Ministry of Regional Development of the Russian Federation has approved 8 projects, including a railway bridge across the Amur (Heilongjiang) River, the mining of coal, industrial complexes, and a Special Economic Tourism and Recreation Zone, with a total value of investment of 376.6 billion rubles (approximately US$12 billion plus, of which it is planned that 12% will come from the Russian fiscal budget and the remaining lion’s share from investment from both Chinese and Russian firms) (Heilongjiang Daily, 26 June 2010; ERINA Northeast Asia Watch, No. 141, 9 July 2010).
Outside the Northeast also, adding to the existing Greater Mekong Subregion (GMS) program with Yunnan Province and the Guangxi Zhuang Autonomous Region, it was decided at a meeting of the Communist Party of China Central Committee and the State Council in May 2010 to construct a special economic zone in Kashgar in the Xinjiang Uygur Autonomous Region and form a hub for cross-border regional cooperation with Central Asia and South Asia (Lianhe Zaobao, 23 May 2010; “China’s Latest News” No. 509, 8 June 2010, http://www.bizchina.jp).
As an important policy to achieve the national objective of correcting economic disparities and establishing a moderately prosperous society (xiaokang shehui), the regional revitalization strategies of the Western Region Development and the Revitalization of the Northeast have been put into effect, and both regions have attained or exceeded the national average economic growth rate. The Yangtze (Changjiang) River Delta and Pearl (Zhu) River Delta regions, however, which have ridden the wave of Western-led globalization, have achieved higher growth than that, and the disparities have not shrunk. Against a backdrop of such domestic circumstances and the unfolding of the global financial and economic crisis from 2008 on, China has been aiming at the strengthening of a regionalism (international regional cooperation) that includes international micro-regions around its borders, and has been moving forward new policy developments. Even while fraught with the danger of overlapping investments and excess investment, it is an attempt to build a new Chinese economic development system, with development balancing regionalism and globalization and development of the latter founded on the former. The improvement of relations with Russia against a backdrop of the resolution of border problems, etc., has also become a condition for that promotion (adding to what was stated previously, the Sino-Russian joint development of Bolshoy Ussuriysky Island [Chinese name: Heixiazi Island] whose area has been divided in two, has also been raised, amongst other matters).
With the 1997–1998 Asian currency and economic crisis China changed its policy, aiming at the promotion of East Asian regional cooperation, yet now ten years later, based on a new global economic crisis, they have raised regional cooperation promotion policy up another stage to a high level. The recent introduction of flexibility to the Chinese yuan (Renminbi) (19 June 2010, People’s Bank of China statement), or in other words the abandonment of the policy of the fixed exchange rate with the US dollar, can also be designated as one expression of that.
Russia, which has shown an economic decline greater than Japan’s in the global financial and economic crisis, appears to be staying in step with China’s policy development. In Japan, Prime Minister Yukio Hatoyama, who raised an East Asian Community, stepped down after scarcely nine months, and the new Prime Minister Naoto Kan inherited the issue. China, Asia and the world are paying attention to see what Japan has learned from the global financial and economic crisis, and what kind of policy it will develop to overcome a twenty-year period of low growth.
[Translated by ERINA]