China: Wang Yang, the party chief who transformed Guangdong

Wang Yang

This is the first of SCMP’s two-part series on Guangdong party chief Wang Yang, a reformist who has turned the province into a base for high-end manufacturing.

SCMP reports: “‘Empty the cage and let the right birds in’ was Wang Yang’s main economic prescription when he became Guangdong’s Communist Party chief in December 2007.

“Calling for a switch from labour-intensive and polluting industries such as toys, textiles and plastics manufacturing, Wang argued that a healthier economic structure, featuring cleaner and higher-value industries, was the only way out for the southern export-hub. The global financial meltdown in 2008 and the European debt crisis that followed only reinforced that view.

“Wang’s courage to break away from a model that had delivered three decades of double-digit growth in the province’s gross domestic product won him a reputation as a liberal reformer and made him stand out among the traditionally GDP-obsessed provincial governors.

“His advocacy of free-market reform in Guangdong also contrasted strongly with former Chongqing party chief Bo Xilai‘s fervent championing of an economic model that largely relied on state-owned firms and government to spur growth.

“With Wang’s five years in Guangdong nearing an end, his cage-and-bird theory has become a catchphrase that has spread to other coastal provinces such as Zhejiang and Jiangsu, which have also relied heavily on export manufacturing. Analysts said it was also likely to be remembered as a manifestation of President Hu Jintao‘s ‘scientific concept of development’ – a key legacy of his 10-year reign.

“The provincial party mouthpiece Nanfang Daily has hailed Wang’s success in turning the province into an international base for high-end manufacturing and services, with factories producing trains, cars, LCD screens and other hi-tech products. At the same time, it said, the province has also boosted its heavy industry sector with new steel and petrochemical projects.

“The Guangdong model, which echoes the central government’s repeated calls for economic restructuring, has won endorsement from many leading mainland economists. Li Yining, one of the pioneers of market reform, praised Guangdong’s focus on industrial innovation and upgrading as an inspiration for other provinces.”

“However, it is too early to conclude that Wang’s pet slogan has put Guangdong’s economy on the right track, especially as the province is yet to show solid signs of recovery from a substantial slowdown, and with little evidence that wealth gaps and regional differences within the province are narrowing.”

“After some economic commentators said Wang’s tough stance on low-end manufacturers was strangling the vigour out of market forces, Wang softened his tone slightly in 2009, putting more emphasis on maintaining economic growth and job creation to avoid social unrest.”

“Guangdong has now turned to massive infrastructure projects for the stimulus needed to spur economic growth amid stagnant trading conditions and consumer demand.

“In May, the provincial government issued a notice urging the construction of 18 key projects – including railway lines, highways, urban light rail networks, massive oil refineries and the expansion of Guangzhou’s main airport and – in response to a central government order to stabilise growth.”

“Wang’s vision also saw the relocation of small factories and an end to the use of outdated technology as a way to tackle rampant pollution in a province known for its dirty textiles and electronic-waste recycling businesses.

“But it seems that he overlooked the potential environmental impact of energy-intensive, polluting petrochemical plants along the coast, despite the poor environmental records of the country’s big oil companies and protests by residents.

“The Nanfang Daily has reported that the province is well on track to become ‘a world-level heavy industrial cluster’ with four petrochemical bases – in Jieyang, Huizhou, Maoming and Zhanjiang.

“Meanwhile, Wang has also made limited progress on another promise he made: to close a widening wealth gap.”

Read the fill SCMP report


Categories: Politics & Law

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