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Opinion
From Late Starter to Frontrunner
Development by leaps and bounds amid reform and opening up
By Yi Xiaoguang | NO. 47 NOVEMBER 22, 2018

Ancient-style architecture built leaning on the mountain in the Hongya Cave area of downtown Chongqing forms a sharp contrast with modern buildings on the other side of the Jialing River that runs through the city (WEI YAO)

Chongqing, with a history of 800 years, is now a pioneer in China's reform and opening up. It has assumed new responsibilities in accordance with its changing role in the country's historic evolution over the past four decades.

In 1983, Chongqing was invested with provincial-level administrative powers and designated as a foreign trade port. It was also authorized to pilot a comprehensive economic restructuring program with a focus on the reform of state-owned enterprises (SOEs).

After President Jiang Zemin proposed to build Chongqing into an economic hub on the upper reaches of the Yangtze River, China's largest waterway, in 1994, Chongqing, then part of Sichuan Province, became China's fourth and youngest municipality directly under the Central Government in 1997. Ten years later, when President Hu Jintao visited Chongqing in 2007, he requested that Chongqing should further develop into an important growth engine in west China.

During a visit to Chongqing in 2016, President Xi Jinping said the city is not only essential in China's western development program but also serves as a major pivot to connect the Belt and Road Initiative (consisting of the Silk Road Economic Belt and the 21st-Century Maritime Silk Road)with the Yangtze River Economic Belt program. He stressed that Chongqing should transform into a frontier of opening up in hinterland expanses and pursue high-quality development.

Wider opening up

On March 29, 2014, Xi visited the western German city Duisburg in the state of North Rhine-Westphalia and welcomed the arrival of a China-Europe cargo train from Chongqing. Taking 16 days to arrive, the train was loaded with 50 containers of laptops and electronic products to be distributed around Germany and other parts of Western Europe. It typified how Chongqing has compensated for its inland location by engaging with the Belt and Road Initiative and renovating its growth model.

The Sichuan Basin, located in the vast expanse of west China and home to Chongqing, is surrounded by steep mountains. Yet, these extreme geographical conditions haven't stopped the local population from exploring the outside world.

The pursuit of opening up is in the cultural genes of Chongqing residents who have seized the opportunity of reform and opening up to promote local development.

Chongqing has built an international transportation network of railways, roads, waterways and airports which link the city with other places along the Belt and Road and the Yangtze River Economic Belt.

The China-Europe freight rail service, the new land-sea transit route under the China-Singapore (Chongqing) Connectivity Initiative and China-ASEAN road freight service have greatly expanded Chongqing's connectivity with overseas markets. There is also an express container liner service between Chongqing and other ports along the Yangtze River, with the container handling capacity of Chongqing's port exceeding 1 million twenty-foot equivalent units. Sixty-nine international air routes from Chongqing have also been opened, realizing an annual passenger traffic of nearly 40 million and an annual cargo and mail volume of nearly 400,000 tons.

Multiple opening-up platforms have been established in Chongqing. Liangjiang New Area, a national development zone modeled after Pudong New Area in Shanghai and Binhai New Area in Tianjin, has become a major incubator for strategic emerging industries as well as modern manufacturing and service industries. This includes the Lianglu-Cuntan Free Trade Port Area, the first of its kind which includes both a river port and an airport, as well as the Xiyong Comprehensive Bonded Zone which handles nearly half of Chongqing's imports and exports. The establishment of the China (Chongqing) Pilot Free Trade Zone last year further boosts the city's opening up.

Chongqing has also launched a series of measures to accelerate customs clearance including the introduction of a 24/7 service last year. The city has created a sound business environment for foreign investors by applying the pre-establishment national treatment plus a negative list approach.

A modern metropolis

In 2017, over 78 million laptops were produced in Chongqing, accounting for one fourth of the world's total output. More than 3 million cars were manufactured in Chongqing last year, making it the largest automobile production base in China. Some of the world's leading robot manufacturers, such as Fanuc Corp. of Japan, KUKA Robotics Corp. of Germany and China's Huashu Robotics Co., have all set up factories in Chongqing. Major Chinese Internet companies including Alibaba and Tencent are also using the city as a base for developing artificial intelligence technologies.

Over 40 years ago, Chongqing was one of the major industrial bases in China with an industrial system founded on machine building, chemical engineering, textile and food industries. But it was at the lower end of the industrial chain at that time. In the following decades, the city has seized opportunities from the international industrial relocation and intensified efforts to attract foreign investment. At present, Chongqing has formed an industrial structure involving pillar industries including automobile, electronics and equipment manufacturing, with strategic emerging industries now accounting for 17.3 percent of the city's GDP.

One of the main targets of reform and opening up is to establish a socialist market economic system. Chongqing has made great efforts to promote the reform of SOEs and encourage the development of private enterprises. In 2017, the private sector contributed 61.2 percent to the city's GDP.

In addition, Chongqing has expanded cooperation with foreign companies. In May 1993, the Sino-Japanese joint venture Chang'an Suzuki Automobile Co. was established in Chongqing. Years later, in April 2001, the Sino-American joint venture Chang'an Ford Motors Co. chose to locate in the city. In November 2002, Chongqing Sino-French Water Supply Co. Ltd., a joint venture between French water and waste service company Suez Environment and Chongqing, was also established, with the French company holding 60 percent of the stakes.

Chongqing has made great strides in urbanization. When the city was upgraded to a municipality directly under the Central Government in 1997, its public services were underdeveloped. The local government has encouraged the rural population to move to urban areas by improving transportation systems and other infrastructure, as well as promoting industrial development. In addition, it has sped up the integration of urban and rural areas with a host of supporting programs.

In 2017, the city's urbanization rate was 64 percent, up nearly 51.7 percentage points against 1978. Today, Chongqing has become a mega city with a registered permanent population of more than 10 million in major urban districts. Its public services have improved.

Social progress

Chongqing has made prodigious efforts to develop education, science and technology, and healthcare.

In 1978, the higher education enrollment rate in China was only 7 percent and the figure was even lower for Chongqing at 4 percent. In 2017, the rate increased to 43 percent in Chongqing. The number of higher learning institutions in the city also increased from less than 10 to 65.

Last year, Chongqing's 1,803 research institutions made 64,600 patent applications, including 19,300 for invention recognition. The development of education and science has injected new vitality into the local economy.

People's living standards have also improved markedly. Thanks to the progress of the healthcare services, local residents' average life expectancy improved from 65.86 years in 1981 to 77.3 in 2017. The per-capita living space in Chongqing's new urban districts increased from 3.87 square meters in 1980 to 35.28 square meters in 2017 in major urban districts.

Chongqing's transformation is a microcosm of China's progress. Reform and opening up started in eastern and southern coastal areas, gradually spreading to central and western regions. In spite of being an inland city in the west, Chongqing has become an active participant in the epic endeavor.

The author is director of the Chongqing Comprehensive Economic Research Institute

Copyedited by Craig Crowther

Comments to jijing@bjreview.com

 

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