Eastern regions ahead in nurturing private sector, high-level opening-up

Two newly released lists ranking China's top 100 counties and districts have revealed the most economically vibrant county-and district-level regions, where experts said market mechanisms and the real economy are the pillars supporting strong and healthy economic performance.

Kunshan city in East China's Jiangsu province has remained in first place for 15 years on the list of China's top 100 counties and county-level cities, according to the report released last week by the Research Institute of Development Strategy for Small and Medium Cities.

The county-level city has a strong economy with dozens of industrial clusters, and 912 enterprises each has an annual output value exceeding 100 million yuan ($14 million).

The city reported a GDP of more than 383 billion yuan in 2018, higher than many countries, and its industrial output was about 172 billion yuan.

Shunde and Nanhai districts of Foshan city in Guangdong province snapped the first two places on the list of the top 100 districts, also released by the institute at the same time, which they have held for eight and six consecutive years respectively.

East China, especially the coastal areas, has the largest number of counties and districts making the lists, which were 62 and 74, respectively.

A total of 24 counties or county-level cities, and 21 districts in Jiangsu province made the lists, the most in the country.

Zhejiang province has 15 counties or county-level cities on the list and 18 districts. Shandong province has 13 counties or county-level cities, and 12 districts.

Experts said the high development level of the real economy and high-value-added manufacturing in the regions, a result of their pioneering in opening-up and reform and market economy practice, are the main reasons that they have such vigorous development performance.

Shunde, which has two Fortune Global 500 companies - home appliances maker Midea Group and real estate developer Country Garden - reported a GDP of more than 316 billion yuan in 2018, and is famous for its progress in the intelligent manufacturing sector.

Nanhai, with GDP of about 281 billion yuan in 2018, is known for its rapidly expanding high-tech manufacturing, new energy, and new material industries.

"China's reform and opening-up started with the coastal area. East China got into international trade and resources allocation earlier than the other regions, and thus had the first mover advantage to attract foreign investment and develop industrial chains," said Zhou Mi, a senior researcher at the Chinese Academy of International Trade and Economic Cooperation.

Zhou spoke highly of the real economy-centered economic structures of eastern areas, especially those in Kunshan city, and Shunde and Nanhai districts, saying they were good examples of the great importance of county-level economies for regional economic development.

"Coordinated development in a region relies on county-level economies, which help bridge the economic coordination among medium-sized and large cities in a region, and help optimize resources allocation," he said.

"There is no way that a region can develop well if it has weak county-level economies."

To boost county-level economies, it is important to devise development strategies based on geographic locations and regional resource advantages, to forge an industry chain that suits the development of the region, instead of blindly chasing after hot industries or copying development models of others, he said.

Chen Liuqin, founder and director-general of Beijing-based Qin Dian Think Tank, said the two lists reflect the regional development difference among China's east, middle and west regions, showing that the east area has stronger county-level economies compared to the other two.

The overwhelming dominance of East China's counties and districts reaffirmed the active development of the private sector and high-level of opening-up in the area, especially in county-level economies, he said.

On the other hand, the business environment in the west of China is not as agreeable as in the east, he added.

"High-quality development of county-level economies is the basis for high-quality development of a national economy, as county-level economies are the cells of a national economy and serve as a core powering the regional economy," he said.

Chen also said county-level economy development was weak in many areas of China, and a strong real economy, attention to innovation and coordinated regional development were most important to boost county-level economies.