Wednesday, September 17, 2003
Investments in China head west
One of the big criticisms levelled at the Chinese government has been the uneven spread of economic growth. The eastern seaboard has been growing at a phenomenal pace while the western heartland has lagged considerably, resulting in unsustainable levels of migration from the west to the east. Telecom Asia counters the perception with a story on how the Chinese government is managing to drive some amount of technology investment into its hinterland -- in this case to the Himalayan city of Chengdu.
Chengdu, where a statue of Mao Zedong at the city's main square stands just blocks away from a shopping district filled with glitzy stores, gave rich incentives to Intel, analysts said.Those incentives are part of China's "go west" policy, which offers preferential taxes and infrastructure assistance to lure foreign firms to the nation's less developed hinterland.
Perhaps there is a lesson in here for people like me who worry about the skewed economic growth in India, where peninsular India, which (unlike China) has a lesser proportion of the population, outstrips the rest of the country. Then again, the Chinese government is a more centralised animal that can direct investment more effectively than either the Indian government or the government of U.P. and Bihar. The U.P. government has also got to realise that promising would-be investors that they "will not be kidnapped" (unlike before) does not constitute real incentive to invest.
Chengdu, where a statue of Mao Zedong at the city's main square stands just blocks away from a shopping district filled with glitzy stores, gave rich incentives to Intel, analysts said.Those incentives are part of China's "go west" policy, which offers preferential taxes and infrastructure assistance to lure foreign firms to the nation's less developed hinterland.
Perhaps there is a lesson in here for people like me who worry about the skewed economic growth in India, where peninsular India, which (unlike China) has a lesser proportion of the population, outstrips the rest of the country. Then again, the Chinese government is a more centralised animal that can direct investment more effectively than either the Indian government or the government of U.P. and Bihar. The U.P. government has also got to realise that promising would-be investors that they "will not be kidnapped" (unlike before) does not constitute real incentive to invest.
