By Xie Liangbin, Liu Jinsong and Intern Li Yuanyuan (谢良兵 刘金松 李媛媛)
Nation, page 11
Issue No. 556
Feb 13, 2012
Translated by Zhu Na
Original article: [Chinese]
A satellite view of Beijing and its eastern neighbour, Tianjin Source: NASA
It's a long time since the people of Tianjin were this confident.
“In the past, when we went away for meetings, people would say isn’t Tianjin just a big village?” remembers Zhou Shengxi (周胜昔), an official with the city’s Economic and Information Technology Commission. Zhou and his colleagues have just seen their city’s economy grow by 16.5 percent.
Tianjin was the birthplace of modern industry in China - the city manufactured the country’s first bicycle, its first watch and its first television – but, despite being one of the three original cities under the direct control of the central government, it has always been eclipsed by Beijing, and came to be seen as “the country’s largest village”.
The changes began quietly in 2006, when Binhai New Area (滨海新区) became the country’s second such district (国家级新区), after’s Shanghai’s Pudong New Area, and the city was made “the economic center of the North” by the State Council. Until then, that title had been held by Beijing and Tianjin had only been recognized as “an important economic area”.
Chart: Tianjin's GDP has grown faster that Beijing's over the last four years
The city was transformed from a traditional industrial city to a modern manufacturing base. From 2006 to 2010, investment in fixed assets grew at a rate of over 30 percent a year, pushing the rate of GDP growth to 17.4 percent in 2010.
Meanwhile, 100 kilometers to the west, Beijing has sunk into “anxiety”. As the capital city, it has many advantages and a sense of its own superiority, but it has also had to deal with many challenges - growing population, heavy traffic and spiraling house prices. Its economy, whose 8 percent growth in 2011 was the lowest anywhere in China, needs to be transformed urgently.
The huge gap in growth between Beijing and Tianjin reflects the changes in each city’s economic positioning over the last five years. Beijing relinquished to Tianjin the role of “economic center of the North”, and development opportunities opened up in the coastal city, reshaping the economy of the Bohai Sea region.
From the perspective of industrial development, the relationship of these two neighboring cities can be described “as one goes up, the other goes down”.
Timeline: Beijing's changing status in state plans
Before the liberation of China in 1949, Tianjin was a major port city with highly developed light industry, while Beijing’ specialty was hand-made products. However, Beijing and Tianjin changed after 1949.
After 1949
In 1953 state planners decided to make Beijing China’s political, economic and cultural center. They particularly wanted the capital to be strong in science, industry and technology and planned for these facilities to be built in the suburbs. Their emphasis was on “production first, life later”, said the vice president of China Academy of Urban Planning & Design, Yang Baojun (杨保军), adding that this set the city’s course for the following thirty years.
Whereas Tianjin was treated as a coastal defense city and, given the overall climate in the early days of the People’s Republic, was prevented from developing industry.
Beijing on top
By 1979, Beijing’s industrial output was greater than Tianjin’s and second only to Shanghai. Its population also grew rapidly from 4.14 million registered residents in 1949 to 9.5 million in the mid-‘80s.
Over that period Tianjin was underperforming the rest of the country- its economy grew at an annual rate of 6.5 percent between 1979 and 1986 compared to an average of 9.5 percent for the whole country.
Beijing’s industrial expansion also brought problems with industries such as steel, petrochemicals and construction materials using up precious water and energy.
Many analysts warned against making Beijing an economic center, and in the 1983 version of the city plan, its role was slightly changed, with the capital relabeled as “China’s political and cultural center”.
Timeline: Tianjin's rising fortunes
Tianjin's chance
In the early of ‘90s, many of Beijing’s industry withdrew from the urban areas and its role as an economic center was downgraded, giving hope to Tianjin.
The idea of marking out Binhai New Area from the rest of Tianjin’s economic development zone was conceived in ’94, although the area didn’t achieve the status of a national strategic development for several more years.
Soon, Beijing’s infrastructure and environment began to seem inadequate and its economy was overtaken by fast-growing coastal cities such as Shenzhen.
Beijing began to cultivate its high-tech industry while, starting from 1999, the central government positioned Tianjin as “an important economic area”. Tianjin blamed Beijing for its disappointing economic performance, but, in fact, the capital was also struggling.
Beijing's dilemma
The question of whether Beijing should become the country’s economic center and whether the city ought to develop modern industry has always been a central issue for Beijing’s city planners, says Shi Weiliang (施卫良), the top engineer at the Beijing Municipal Commission of Urban Planning.
With regional GDP growth statistics playing such an important role in the evaluation of officials across China, Beijing’s decision to relinquish its role as an economic center represented a major policy decision.
Beijing’s selection as the host city for the 2008 Olympic Games again altered the course of the capital city and its eastern neighbor.
It meant that the city’s planners grandly claimed in 2004 that the city should be not only “the country’s political and cultural center” but also “the world’s well-known ancient capital and a modern international city”.
Center of the North
In that year, central planners clearly stated that Shanghai was the country’s economic center, and Tianjin was the “economic center of the north”.
The plans that the State Council approved for these cities in 2006 saw Beijing formally give up its position as economic center. That was also the year when the central government accorded Binhai New Area the prized status of national-level strategic development zone.
The launch of that zone kick started Tianjin’s rise and prompted an official in Guangzhou to remark that his city, which saw itself as China’s third major city, might be under pressure from a new “imaginary rival” that would replace Shenzhen or Suzhou.
The last five years have seen Tianjin win a series of significant projects including the Airbus A320 assembly line, high-thrust rockets and satellites. The old industrial base now has eight new competitive industries: aerospace, information technology, machinery making, pharmaceuticals, petrochemicals, alternative energy and materials, defense technology and textiles.
Tianjin has benefited from support from the central government, says Zhou from Tianjin Economic and Information Technology Commission.
Since the city’s ninth congress in 2007, it has received two trillion yuan in investment, equivalent to 200 million yuan for each of its 11,900 square kilometers, says Zhou.
Beijing’s 8 percent GDP growth in 2011 put it at the bottom of China’s table, but the city’s leaders have said the necessary changes to the development model are tough and require the sacrifice of some GDP growth.
Beijing is well aware that it has previously invested in energy- and resource-intensive industries, relied on revenue from highly-priced land sales and levies on property transactions, and boosted consumption by promoting car sales. The city’s leaders are also aware that this model for growth is no longer sustainable. One sign of these changing times for Beijing came last year, when state-owned steelmaker Shougang fired off the last blast furnace at its Shijingshan (石景山) plant on the western edge of the city.
The loss of that plant trimmed 400 million yuan from the fiscal revenue of Shijingshan district in 2011, and the region is shifting its focus to the creative industries and producer services. In finding a new focus for its economy, the district will hope to follow the example set by Chaoyang district in eastern Beijing which fifteen years ago begun to transition from textiles to the high-end service industry and now has a major business zone. For example, on the site of one famous old coke furnace there are plans to build a major regional economic office.
Not all of Beijing’s problems have been resolved – its population has expanded quickly and the roads are often gridlocked. The government’s goal is for Beijing to become both a “global city” and a “sustainable city” by 2050.
There are several conditions necessary for Beijing to achieve its ambition of becoming a global city, says Nankai University’s Zhou Liqun (周立群). Any global city, he says, must be the capital of a large country; it must be near a port and it must be surrounded by an economically developed region.
Beijing’s ambition has made opportunities for Tianjin. Many businesses shifted from Beijing to Tianjin, especially its national strategic development zone, as well as the surrounding Hebei Province.
“Costs in Beijing are high, especially for young employees who face issues with housing, transportation and high rents,” says Tianjin official Shi Jiping (史继平).
Shi notes another sign of the area’s rising appeal - some of the companies entering the zone now ask for help obtaining a household registration, or hukou (户口), for their talented employees.
In Beijing, the services sector accounted for three quarters of GDP in 2009. Some people in Tianjin worry that China’s national strategy of making an economic development region around Beijing (首都经济圈) will interfere with Tianjin’s role as an economic center in the north.
Within this national strategy, Beijing might become a center for high-tech industries and the high-end service sector, while the port city of Tianjin could expand its manufacturing sector and build a strong position in automobiles, biotechnology and pharmaceuticals.
