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Typical Cases in Northwest China

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State Failure and Distorted Urbanisation in Post-Mao's China, 1993–2012

Part of the book series: Palgrave Studies in Economic History ((PEHS))

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Abstract

In this chapter, we have described three typical cases in Northwest of urbanisation and industrialisation—Lanzhou New District, Ordos District and Xining Development Zone. We illustrate how urbanisation led by state developed fast in underdeveloped regions. All the local governments tried to build new cities on barren land despite high cost and low efficiency. They disobeyed the natural law of market and their attempt failed unsurprisingly. Lots of waste of resources was created. In all our cases, the financial back-up for creation of new cities came ultimately from leases of the state-owned land. This is the main legacy of the Maoist institutions.

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Notes

  1. 1.

    See Anon., ‘Economic Growth Potential from Urbanisation Rate’, vide: http://cpc.people.com.cn/19th/n1/2017/1021/c414305-29600807.html, available on 21 October, 2017.

  2. 2.

    Hu, Huanyong, ‘Zhongguo Renkozhi Fenbu’ (Distribution of China’s Population), Dili Xuebao (Acta Geographica Sinica), 2 (1935): 33-74.

  3. 3.

    Lu, Shuiming, ‘Xibu Dakaifade Lishi Yu Xianzhuang’ (The Past and Present of China Western Development), Bainian Chao, 8 (2000): 17-23.

  4. 4.

    Yu, Jin, ‘Zhongguo Xibu Dakaifa Shizhouniande Huigu Yu Zhanwang’ (Review and Prospect on the 10th anniversary of China Western Development), vide: http://theory.people.com.cn/GB/41038/12344478.html, available on 4 August 2010.

  5. 5.

    Ibid.

  6. 6.

    Philips, Tom, ‘China Goes West: A Ghost City in the Sand Comes to Life’, The Guardian , vide: https://www.theguardian.com/cities/2017/mar/21/china-west-ghost-city-comes-to-life-lanzhou-new-area, available on 21 March 2017.

  7. 7.

    Calculated according to Table 3.4.

  8. 8.

    Chemical and petrochemical industries caused Lanzhou’s severe air pollution, as the city of Lanzhou is surrounded by hills.

  9. 9.

    The general administrative level of China’s provincial capital cities is the same with prefecture-level cities. Only the position of the party secretary of a provincial capital city is vice-ministerial level, higher than general city officials.

  10. 10.

    See transcript of Mo, Yan, ‘Lanzhou Xinqu – Zhonggong Yuanlao Song Ping De Yuyan’ (New District of Lanzhou and the Outlook by Song Ping, the Veteran Communist), vide: https://mp.weixin.qq.com/s?__biz=MzI3NTE2NjI4Nw%3D%3D&idx=1&mid=2670641612&sn=9b4941fd132b03079e7fa74a05c85e73, available on 4 July 2017.

  11. 11.

    See ‘Lanzhou Xinqu Chanye Fazhan Guihua’ (Development Plan for Industries in Lanzhou New District), vide: https://www.qianzhan.com/regieconomy/detail/197/121102-53823c6f.html, available on 2 November 2012.

  12. 12.

    Hancock, Tom and Xinning Liu, ‘Yan Jiehe Qisu Lanzhou Zhengfu Tuoqian Gongchengkuan’ (Yan Jiehe Sued the Lanzhou Government for Default on Construction Cost), vide: http://www.ftchinese.com/story/001076244?print=y, available on 6 February 2018.

  13. 13.

    Zhang, Jinsong, ‘Lanzhou Zaocheng Xian Nining’ (Deep Trouble with City Construction in Lanzhou), China Real Estate Business, 22 July 2013, vide: http://www.fangchan.com/news/1/2013-07-22/351158.html, available on 22 July 2013.

  14. 14.

    Fu, Linlin, ‘Lanzhou Kongcheng Ji: Yige Guojia Xinqude Xiaotiao Yangben’ (Lanzhou, An Empty Shell City: A Case of Recession of a National Growth Project), vide: http://www.jiemian.com/article/778364.html?_t=t, available on 3 August 2016. Similar, see Xiao,Ming and Yaqin Zhu, ‘Lanzhou Xincheng Lunwei Guicheng’ (New Town Becoming Ghost Town in Lanzhou), vide: http://www.china.com.cn/shehui/2016-05/31/content_38568718_3.htm?bsh_bid=, available on 31 May 2016.

  15. 15.

    See the report of Barboza, David, ‘Chinese City Has Many Buildings, But Few People’, The New York Times , 19 October, 2010, vide: http://www.nytimes.com/2010/10/20/business/global/20ghost.html, available on 20 October, 2010.

  16. 16.

    See E Er Duo Si Tongji Nianjian ( Ordos Statistical Yearbook), 2004 and 2005.

  17. 17.

    Resource tax has been levied as an ad valorem tax since 1 July 2016. Before then, the tax was levied as a percentage of the exploitation quantity, which means that the tax was extremely low despite the big price increase.

  18. 18.

    See E Er Duo Si Tongji Nianjian ( Ordos Statistical Yearbook), 2002 and 2012.

  19. 19.

    See E Er Duo Si Tongji Nianjian ( Ordos Statistical Yearbook), 2010.

  20. 20.

    The GDP per capita of Tianjin was the highest among China’s biggest cities, which was 115,612 yuan.

  21. 21.

    Anon., ‘E Er Duo Si Xinchengqu Wanyuan Fangjia Zhijiang Qicheng’ (A Seventy Percent Drop in 10,000-Yuan per Square Metre Building in New District of Ordos), vide: http://news.dichan.sina.com.cn/2011/11/07/400452_all.html, available on 7 November, 2011.

  22. 22.

    Lu, Zhenhua, ‘Neimeng E Er Duo Si Bei Yiwei Xiandaihua Kongcheng’ (Ordos of Inner Mongolia Is Regarded as a Modern Ghost Town), vide https://news.qq.com/a/20100413/000806_2.htm, available on 13 April, 2010.

  23. 23.

    E Er Duo Si Shizhengfu Gongzuo Baogao, 2006 (Report of Ordos Municipal Government 2006), vide: https://wenku.baidu.com/view/d32c121352d380eb62946d42.html, available on 27 December, 2010.

  24. 24.

    Zhao, Shufang, ‘Qiantan E Er Duo Si Minjian Rongzi Wenti’ (Private Banking in Ordos), Economic Forum, 12 (2010): 166-168.

  25. 25.

    Mu, Jin, ‘E Er Duo Si Shi Fangdichan Touzi Guore’ (Real Estate-overheating in Ordos), vide: http://news.sina.com.cn/c/2006-11-28/123011638690.shtml, available on 28 November, 2006.

  26. 26.

    Anon., ‘2001-2010 Nian Zhongguo Meitan Shichang Yanjiu Baogao’ (Report on China’s Coal Market, 2001-2010), vide: http://www.chinabgao.com/reports/print30445.html, available on 31 March, 2018.

  27. 27.

    Li, Jun, ‘E Er Duo Si Guicheng Loushi Bengpan, Wanyuan Fangjia Diequ Qicheng’ (A Seventy Percent Drop in 10,000-Yuan per Square Metre Building in Ordos), China Enterprise News, 2011–11-25, vide: http://house.qq.com/a/20111125/000158_1.htm, available on 25 November, 2011.

  28. 28.

    Liu, Xing and Haiping Wang, ‘E Er Duo Si Fangjia Bengpan Zhentong’ (Pain of Housing Bubble in Ordos), China Youth News, 3 November, 2014, vide: http://www.ce.cn/xwzx/gnsz/gdxw/201411/03/t20141103_3831045.shtml, available on 3 November, 2014.

  29. 29.

    Ibid.

  30. 30.

    The GDP growth rate of 2013 finally announced in March 2014 was 6.92 per cent which was revised by Ordos government. See transcript of the ‘Annual Report of Ordos Municipal Government, 2013’, vide: http://www.nmg.gov.cn/zzqzf/zfgzbg/eedss_1859/201506/t20150615_399597.html, available on 31 March, 2017.

  31. 31.

    See ‘2013 Nian Neimenggu Zizhiqu Zhengfu Gongzuo Baogao’ (Annual Report of Inner Mongolia Provincial Government, 2013), vide: https://baike.baidu.com/item/2013%E5%B9%B4%E5%86%85%E8%92%99%E5%8F%A4%E8%87%AA%E6%B2%BB%E5%8C%BA%E6%94%BF%E5%BA%9C%E5%B7%A5%E4%BD%9C%E6%8A%A5%E5%91%8A/13682115?fr=aladdin, available on 25 January, 2013.

  32. 32.

    Anon., ‘GDP Cong Neimenggu Zhengsu Diyi Jiangzhi Daoshu Diyi’ (Falling from the Number One Growth Speed to the Bottom), Hangzhou Daily, 30 June, 2013, vide: http://hzdaily.hangzhou.com.cn/dskb/html/2013-06/30/content_1525387.htm, available on 30 June, 2013.

  33. 33.

    Anon., ‘E Er Duo Si Ni Zengchan 6000 Wandun Mei Taigao GDP, Qiye Buyuan Maidan’ (Ordos Government Planned a 60 Million Tun Increase in Coal Production while Enterprises Refused), sohu.com, 25 June, 2013, vide: http://business.sohu.com/20130625/n379807417.shtml, available on 25 June, 2013.

  34. 34.

    Ibid.

  35. 35.

    Chen, Tiancheng, ‘Guicheng E Er Duo Si Xianzhuang’ (Current Status of Ordos), vide: http://www.360doc.com/content/17/0313/11/40217477_636434374.shtml, available on 13 March, 2017.

  36. 36.

    Li, Zailei, Wu, Xiaofei, and Shasha Yu, ‘E Er Duo Si Fangpiao’ (Housing Exchange Program in Ordos), Southern Weekly, 17 July, 2016, vide: http://www.infzm.com/content/118332, available on 17 July, 2016.

  37. 37.

    Lan, Yahong, ‘E Er Duo Si Cheng Zhaicheng’ (Ordos Became Debt City), sina.com, 8 July, 2013, vide: http://finance.sina.com.cn/china/dfjj/20130708/110816048313.shtml, available on 8 July, 2013.

  38. 38.

    Including germanium, gallium, imprison, cadmium, strontium and beryllium, as well as platinum, gold, silver, copper, lead, zinc, nickel, cobalt, tin, molybdenum, antimony, mercury, iron, manganese, chromium, titanium and vanadium.

  39. 39.

    Anon., ‘Qinghai Ganhe Gongye Yuanqu’ (Ganhe Industrial Park, Qinghai), zhaoshang800.com, vide: http://y6462.y.zhaoshang800.com, available on 10 February, 2018.

  40. 40.

    Anon., ‘Yetonghangye Huajie Channengguosheng Jian Shizhao’ (Smelting Copper Industry Reduced Excess Capacity), finance.ifeng.com, vide: http://finance.ifeng.com/a/20151203/14105700_0.shtml, available on 3 December 2015.

  41. 41.

    Anon., ‘Yijidu Ganhe Gongye Yuanqu 25 Xiang Gongye Xiangmu Jizhong Kaifugong Jianshe’ (Resuming 25 Construction Projects Altogether in Ganhe Industrial Park in the First Quarter), xinhua.net, 1 April 2017, vide http://www.qh.xinhuanet.com/2017-04/01/c_1120738902.htm, available on 1 April 2017.

  42. 42.

    The environmental damage in Northwest China is extremely serious now due to industrial pollution. For example, according the central government, 79.1 per cent of total population in the Northwest is living in the water polluted area.

  43. 43.

    Here we refer ‘traditional industries’ to sun-setting sectors where the market is saturated, such as iron-steel, automobile, textiles and construction.

  44. 44.

    Government-owned public housing is a type of welfare and does not follow the market price signals.

  45. 45.

    Wang, Fang, ‘Sipu Zhi Wupu Jian Zhongguo Chengzhen Renkou Zengzhang Guocheng Fenxi’ (Analysis of Growth of China’s Urban Population between the Fourth Census to the Fifth Census), Renkou Yanjiu (Population Research), 3 (2004): 60-67.

  46. 46.

    Chen, Qin, Chengshihua – Renko He Tudide Yaosu Zai Peizhi (Urbanisation – Re-allocation of Population and Land), PhD Dissertation, Fudan University, 2013.

  47. 47.

    Wu, Si, Qianguize: Zhongguo Lishizhongde Zhenshi Youxi (Hidden Rules: the True Game in China’s History), Shanghai: Fudan University Press, 2009.

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Authors and Affiliations

  1. Beijing Enlightenment Institute for Economic and Social Research, Beijing, China

    Yazhuo Zheng

  2. London School of Economics, London, UK

    Kent Deng

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Zheng, Y., Deng, K. (2018). Typical Cases in Northwest China. In: State Failure and Distorted Urbanisation in Post-Mao's China, 1993–2012. Palgrave Studies in Economic History. Palgrave Pivot, Cham. https://doi.org/10.1007/978-3-319-92168-6_3

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