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Premier Li delivers harsh words to local officials in NE China

Zhao Yinan in Changchun, Jilin province
Updated: Apr 10,2015 8:50 PM

[Photo by Ding Lin/Xinhua]

Premier Li Keqiang was welcomed with cheers and adulation during his visit to one of China’s largest rail equipment manufacturing bases on April 10.

Cardboard signs -- “Thank you, Mr Salesman” -- thanking the Premier for his work on advocating and promoting China’s manufacture and export of rail equipment were raised high in the air. The scene reminds people of a similar situation in the early days of the country’s opening-up, when Beijing students posted an unexpected banner reading “Hello, Xiaoping” to greet China’s reform mastermind during a parade in Beijing in 1984.

The Premier visited the CNR Changchun Railway Vehicles Co. as part of his visit to Jilin province.

[Photo by Ding Lin/Xinhua]

Large projects such as the manufacturing and export of rail equipment, as well as the supporting industries that grow with it, remains the key method to bail decelerating economy in Northeast China, one of the places feeling the most pains of falling commodity prices, shrinking demand and economic restructuring, Li said at an economic seminar held after the trip to the train-maker.

“To maintain smooth economic development in Northeast China, the top issue is to initiate major infrastructure projects which will give big incentives to the local economy, at the same time the government has to increase investment in transportation, water conservancy and urban sewage system upgrading,” Li said.

According to Li, large projects must be approved and started soon, in a bid to encourage investment, and the government has to select a new group of projects to provide further boost.

The economic seminar, where governors from three Northeast provinces reported the latest data regarding the local economy was held before the country is due to release economic data of the first quarter on April 15.

[Photo by Liu Zhen/China News Service]

Analysts expect the economy to expand at 7 percent in the first three months, while many have even set a lower forecast. The volume of rail freight, one of the three major economic indicators used by the Premier to gauge economic development when he was the governor of Northeast Liaoning province, decelerated to a six-year low in the first two months by 9 percent year-on-year, indicating strong contraction in the real economy.

While reassuring the economic fluctuation remains in a reasonable range of development, Li admitted “mounting pressure” in the economy, and nationwide speaking, the three provinces in the northeast suffer the most.

Jilin set a provincial outlook of GDP growth at around 6.5 percent this year. Even if it could realize that target, it will only rank fourth from the bottom nationally. Heilongjiang, the country’s northernmost province, suffered from more acute pains because of a deeper ingrained tradition in planned economy and closer connections with Russia. The geographical advantage of long coastlines and ports in Liaoning province failed to provide a drive to the declining trade, which witnessed a sharp decrease of more than 18 percent in the first quarter.

[Photo by Liu Zhen/China News Service]

These figures sometimes lag behind the real situation in society and cannot reflect the real time public feeling in a timely manner. Li warned the governors that continuous falling of economic growth could lead to social instability.

He picked out duty dereliction or the reluctance of officials to perform duties amid the country’s campaign to cut power and fight corruption as a major reason behind the problem.

“Intentional neglect of duties have added up to the ill-structured economy. I felt upset as I saw large industrial equipment sleeping along the roads when I traveled through Changchun. Why they were there? Were they waiting for the next project? Lands were wasted without being developed, officials have to be held accountable,” Li said, blaming local officials for not taking the initiative to find new projects and having wasted the well-endowed natural advantage of land and energy resources in the region.

Zhao Zhenhua, an economist at the Party School of the Central Committee of the Communist Party of China, said the Premier has used unusually harsh words during the seminar with local officials in the northeast, which indicates his resolve to drum up the heavy industrial base.