Some Local Governments Can Afford to Change Priorities

Nation, Page 13, Issue 478, July 19
Translated by Tang Xiangyang
Original article: [Chinese]

Why is it that three counties in Shaanxi province, Shenmu, Zichang and Wuqi, have succeeded in fundamentally improving people's livelihood? Is it only because they are rich in natural resources like coal and petroleum?

It can only be said that the wealth of these counties is "fairly good". Only Shenmu has made the list of China's 100 Most Prosperous Counties. Wuqi is a bit worse than Shenmu, and Zichang is at the average level of most Chinese counties. It has an annual fiscal revenue of 600 million yuan which, in many other places, may only meet the local government overhead.

The question is: Why is it that they can manage to succeed in improving the lives of their citizens while prosperous counties can not?

At first the public doubted them, but now it is praising them. The distribution system trial initiated by the three local governments is not a path to Utopia. People have gradually realized that the local officials in the provinces of northwest China who used to be considered backward may have some unique concepts of "political performance" or "development".

Zhang Bo is the director of a department in Shenmu County responsible for planning the reform of the local health system. He once said to me, "Should we pursue a greater GDP and construct some projects to show off our 'political performance', or should we do something good for our people? If we can't help our people benefit from China's economic reform, then what was the point of the reform 30 years ago?"

Many local governments have aimed to construct a service-model of government for quite some time. However, with limits to the energy of government employees and finances, when it comes to the choice of either pursuing economic development or promoting projects concerned with people's livelihood, more local governments have chosen to pursue the former. Even if they make the list of China's 100 Most Prosperous Counties, local governments will always face the pressure of maintaining economic growth.

It was more likely for the counties of northern Shaanxi to shift their attention and resources from economic affairs to improving people's livelihood.

The wealth of northern Shaanxi comes from petroleum and coal reserves. What is widely known is that only Sinopec, PetrolChina, China National Offshore Oil Corporation and the Yanchang Group in Shaanxi Province are authorized to explore oil resources in China; Shaanxi's coal reserves have already been explored by Shenhua Group, Shandong Yanzhou Mining Group and private coal companies. Along the speedway connecting Yulin county to Shenmu county, the coal mines of Yanzhou Coal Company are everywhere.

This means, the local governments of northern Shaanxi, especially county-level governments, do not need to waste energy luring investment and upgrading industries. The oil resources of local governments are connected to centrally-owned enterprises and local governments rarely have a say over their allocation. However, the allocation of coal resources is always decided by the Yanan City government. So, compared with other Chinese counties who rely on industries such as manufacturing to develop their local economies, the county-level governments of northern Shaanxi have more "free time".

They have no need to tackle local economic affairs which has forced their local governments to shift their governments from economy-oriented to service-oriented. I believe, under the current political system, every local government has the desire to promote their local economy and ensure economic growth. But, since the Shaanxi counties have no way to intervene, be they rich or poor, they have more time to contemplate problems concerning people's livelihood and design and put into action different reform projects with varying costs. Without being noticed, they have formed a development concept different from the masses.

In this sense, the model of northern Shaanxi cannot be copied. It is not because their projects can not be conducted in other places, but because the minds of local officials can not be changed. I believe local governments have to be separated from economic affairs before they can conduct similar projects.

This article was edited by Rose Scobie