---- Speech by H.E. Ambassador Zhang Zhijian
at the Development of China’s Less Developed Areas Seminar
(April 1, 2004, Ministry of Trade and Industry in Finland)

Chairman Rutanen,
Director General Eriksson,
Ladies and Gentlemen,
I am very glad to attend today’s Seminar on the Development of China’s Less Developed Areas held by the Asia Society Finland. I would like to thank Mr. Chairman for giving me this opportunity to exchange views with you. And I am also very glad and grateful to see so many Finnish friends interested in the development of the less developed areas in China.
In 2003, a grand new pattern prevailed in the economic development in China: the east region takes the lead, the west region is catching up, the central region is accelerating the development and the northeast region is trying to restore its prosperity. China’s GDP outnumbered 1400 billion US $, registering an increase of 40% over the same period the year before. The total volume of export and import reached 851.2 billion US$, registering an increase of 37.1%. It is estimated that China’s GDP growth this year will remain over 7%.
The Chinese new government has set the establishment of a better-off society as the goal of the next 20 years. The West Region Development and the Northeast Region Recovery have been set as the significant strategies of the sustainable economic development of China. In the past 20 years, the east coastal areas have maintained rapid development. And this good momentum in the east areas will certainly give an impetus to the economic development in the west and northeast regions.
Now I would like to brief on the west region and the implementation of the west development strategy.
The west region is the less developed area in China, which is in the greatest need of development. In terms of the current economic development level, it has been lagging far behind the east and coastal areas. Nevertheless, the west region is a precious land with great development potentials. It has a vast area of 6.85 million square kilometers, including 6 provinces, 1 municipality directly under the Central Government and 5 Autonomous Regions, accounting for two-thirds of the total area of China. The population amounts to 367 million, less than one-third of the whole population in China. There are abundant natural resources and products there. The water energy reserves amount to 82.5% of the total with the explored water energy amounting to 77% of the total in China. It is also rich in mineral resources, with coal, oil and gas which amounts to 36%, 12%, and 53% respectively of the total in China.
The west region is bounded by more than 10 countries, including Russia, Mongolia, Kazakhstan, Kyrgystan, Tajikistan, Afghanistan, Pakistan, India, Nepal, Bhutan, Myanmar, Laos and Vietnam. The land border is over 18 thousand kilometers, which provides broad capacity for the border trade of the west region. The ancient trade passage – Silk Road, established in Han Dynasty AD200, starting from Xi’an and reaching the south Asia, east Asian and Europe. It was a tie connecting the world ancient civilizations and was also the first passage of China’s foreign trade and exchanges.
The west region is the convergence of the ancient cultures. The preserved cultural relics reflect the combination of the world diverse cultures. It is extremely rare in the world that the relics there cover a vast land, with a large quantity and grand scales. Such relics like the Mogao Grottoes, the Potala Palace, the Tombs of Xixia Kingdom, the Jiaohe Ancient City, and castles in the vast dessert all bury the secretes of the ups and downs of the human society and the changes of the nature in history. The unique natural scenery and the historical and cultural relics have bred the precious resources for tourism and science research and investigation.
Since the launch of the West Region Development Strategy four years ago, the west region has become rather hot topic in the Chinese economic development, with its rapid social and economic development and the increase of the living standard of the people.
Firstly, the total economic volume rose greatly with an increasing growth rate. The total GDP of the west region in 2003 reached 30 billion US $, with an increase of 11.2% over the same period of the year before. It was above the average growth rate of the whole country.
Secondly, the investment in the fixed assets increased rapidly and the main infrastructural construction was accelerated. In 2003, the total investment in the west region reached 9 billion US$. And such significant projects as the Qinghai-Tibet Railway and transportation of the gas resources and electricity from the west to the east are going smoothly.
Thirdly, the foreign trade developed rapidly. In 2003, the total volume of export and import of the 12 provinces in the west region was nearly 30 billion US $, with an average growth rate of 40%, among which the growth rate of foreign trade in the provinces of Qinghai and Xinjiang was over 70%.
Fourthly, the educational and scientific sectors have yielded new achievements continuously. In 2002, the students in colleges and universities in the west reached nearly 2 million, registering an increase of more than 1 million students over 1999, with an annual growth of 30%.
Four years of the West Development Strategy have promoted the development in the west region. However, the implementation of the West Development Strategy is a historically long-term mission, and the further promotion of the West Development is still confronted with many conflicts and problems. For example, the infrastructure is rather backward,  the ecologic environment is needs to be improved urgently, the education and health sectors are to be developed, and there are not enough skilled talents, etc. It is pressing to solve the above-mentioned problems, and it also requires the readiness for the long-term arduous efforts. Nevertheless, the Chinese government will never waver the strategy of the West Development, and will not weaken its support for the West Development. The economic and social development in the west region will never slow down.
Next, I would like to talk about the development of the northeast region and the Northeast Recovery strategy.
The northeast region includes 3 provinces, namely Heilongjiang Province, Liaoning Province, and Jilin Province, with an area of nearly 0.8 million square kilometers, 8.3% of the total area in China, and a population of 107 million people, about 8% of the total population. It is bounded by or close to Mongolia, Russia, DPRK, ROK and Japan. The economic industrial structures in the northeast are quite complementary to that of the above-mentioned countries. It is China’s window to the northeast Asia.
The northeast region is one of the main crops production base of China, with rich soil and flat arable land fitting for the machinery farming. The output of the corns and soybeans amounts to 53% and 37% of the national output respectively. The northeast region is also rich in forest and animal resources and has advantages in developing the processing industry of forestry and animal husbandry products.
The northeast region was the industrial cradle of new China. The significant industrial projects of steel, energy, chemicals, heavy machinery, car and ship manufacturing, airplane and military factories located in the northeast since the founding of new China, have laid a preliminary foundation for the industrialization in China. The manufacturing industry in the northeast region amounts to 20% of the total in China. Especially in the fields of heavy and large equipment manufacturing industry, it has the advantage in manufacture, research and skilled workers.
In terms of the transportation network, the northeast region is an important hub for the shortest continental bridge connecting the northeast Asia with Europe. It has already a comprehensive transportation system by water, land and air. In addition, there are many schools of higher education and scientific research institutes in the region, which rank number one in China in terms of having professionals, skilled workers and college students per 10 thousand people. In short the region has great potentials and rich resources in science and education.
As an old industrial base, the northeast region is confronted with the difficulties of heavy burden and debts in the economic transition from the central planning economy to the market economy. Since the opening up policy, the average economic growth rate of the northeast region was lagging behind the national average growth rate for more than 20 years. In the autumn of 2002, the 16th session of the CPC put forward the strategy to restore the economy of the northeast region, supporting the adjustment and reform of the old industrial base in the northeast region and enhancing the coordinated development of the regional economy. In December last year, the first 100 projects were launched with a total investment of 8 billion US$, mainly in the equipment manufacturing, raw material processing and agriculture products processing industries. In March this year, Premier Wen Jiabao chaired the meeting of the State Council, and framed the priorities for system innovation, mechanism innovation and adjustment of the economic and ownership structure adjustment.
It could be predicted that with the economic interaction, advantage complementarities and coordinated development of the economies in the east, west and central China, China will proceed to the road of all-round, coordinated and sustainable development. The relative advantages of the economies in the west and northeast China and the advantages of the vast market and low labor cost of China will provide tremendous opportunities for the neighboring countries and the world at large. We are looking forward to the prosperity and magnificence of the west and the northeast region with the development of the Chinese economy, and moreover, the win-win situation of the mutual benefit at an early date.
As the Chinese Ambassador to Finland, I wish to see further enhancement of the cooperation between Finland and the west and northeast regions of China, and more Finnish capitals, enterprises and personnel going to the west and northeast regions to help the local economy. I believe this will certainly come true. And I also hope that all the friends present today will work along with us to assist the west and northeast China to achieve further development.
Thank you!