China pursuing coordinated regional economic development

China's top economic planner, the NDRC, held a regular press conference on Wednesday to discuss the government's next steps for coordinating the economic development of the country's different regions.

China is pursuing a coordinated development of regions. The country's top economic planner, the national development and reform commission, said Wednesday that China is almost as big as Europe, and also as diverse as the continent. That's why regional development plans have to be tailored. So what's the best fit for the capital city's metro area?

"We need to optimize the functions of the capital city of Beijing, and radiate around the area to boost the development of nearby Tianjin city and He Bei province. We still need infrastructure development on transportation, enhanced industrial facilities, and social security foundations." Fan Hengshan, Dep. Secretary General of NDRC, said.

China's Ministry of Finance announced last week that 10 local governments are allowed to sell bonds directly to finance development projects. It's a move that anlaysts say is an advancing step but yet to be on par with western countries' municipal bond. The list of 10 municipalities covers three regions with different economic status from the capital city to inland Jangxi province and less developed Ningxia province in western China.

However the NDRC singled out another region that's in urgent need of reform: Northeast China, a traditional industrial cluster.

"Last year's economic slowdown made the manufacturing industry suffer in Northeast China. The raw material market also saw collateral damage. Investment in the manufacturing sector, the pillar industry in Northeast China, was hampered as a result." Fan said.

However, the China-Russia gas deal is seen as a tipping point for investment in Northeast China.

"We are working on a cooperation blueprint with Russia between China's Northeast provinces and Russia's far-east and Syberia. The Northeast China region will also be a trading hub for China and Northeast Asian countries." Fan said.

China released its April industrial profits on Wednesday, showing signs of stablizing in its economy. But traditional industrial centers like Northeast China are undergoing major reforms to cut outdated capacity and introduce service-oriented businesses, in order to ease those regions' dependence on high-pollution industries. Analysts are expecting more government support to protect China's economic growth from the downward pressure caused by economic restructuring.