Tom Miller: Mix of motives drives Northeast revamp

From The Financial Times:

In February 2003, Chinese television viewers watched premier-designate Wen Jiabao celebrate Chinese New Year 720 metres down a coal mine in Fuxin, a poor town in northeast China’s industrial rustbelt.

Mr Wen shared dumplings with miners and expressed his gratitude for their contribution to the nation’s modernisation. This homely propaganda exercise showed how Mr Wen and his boss, incoming president Hu Jintao, intended to “put people first” and pay more attention to the regions left behind by China’s breakneck growth.

The scheme to revitalise the Northeast, launched with much fanfare by Mr Wen at the end of 2003, embodies a mix of motives. Politically, it represents the Hu/Wen regime’s effort to stake out a power base distinct from that of the Shanghai clique that dominated China through former leaders Jiang Zemin and Zhu Rongji and their respective patronage networks. Over the past two years, the top levels of the region’s provincial governments have been stuffed with Hu and Wen loyalists.

Economically and socially, the strategy is a central government attempt to pull a failing region up by the scruff of its neck. Once the bastion of China’s planned economy, the Northeast has slipped behind the surging economies of the east coast, centred on Shanghai and Hong Kong. The region was the worst casualty of the decay of state industry in the 1980s and 1990s, and suffered tremendously under the violent restructuring of state-owned enterprises (SOEs) initiated by Zhu Rongji in 1997.

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