On Tuesday, Premier Wen Jiabao unveiled this year's four major tasks for reinvigorating the industrial rustbelts, promising more efforts to restructure state firms, promote the private sector, optimize the industrial mix, and absorb more domestic and overseas investment.

Addressing the first plenary session of the central government's Leading Group for Revitalizing the Northeast and Other Old Industrial Bases, the premier said those areas should speed up institutional innovation and reform, the main road to their revitalization.

The premier explained that reform of the state-owned assets management system and state-owned enterprises (SOEs) must be deepened to increase their economic vitality, and efforts should be made to promote the mixed ownership and private sectors of the economy.

Wen, also head of the group, described optimizing and technological upgrading of the existing industrial mix as the main task to revitalize the once-influential industrial bases.

The old industrial bases should continue to develop those sectors that are well-adapted pillar industries, and strive to advance modern agriculture and consolidate a position as major grain producers and suppliers, said the premier.

He said the old industrial bases should continue to open their economies to other parts of the country and world.

Wen also called on governments in those areas to expand employment and provide better social security coverage.

It is essential to transform the mode of economic growth and prevent blind investment and duplication of construction projects involving low-level technologies, he said.

Among those attending the session were leading members of the group, including Vice Premier Zeng Peiyan, and top officials from Liaoning, Jilin and Heilongjiang provinces. The three provinces make up China's northeast region.

China's strategy is to reinvigorate the traditional industrial centers in the northeast provinces and other parts of the country in a bid to turn rustbelts into modern industrial zones, making them new and important growth areas of the national economy.

China considers the revival of the northeast industrial base as its third most important long-term strategy, following the opening of the southeast 20 years ago and the western development policy five years ago.

The northeast region played a major role in modern China's industrial development. It produced the first batches of steel, machine tools, locomotives and planes after the founding of the People's Republic in 1949, and still has potential in these fields.

The central government launched 150 state-level key heavy industry projects during the first several years after the founding of the PRC, one-third of which were built in this region. These projects were in the iron and steel, chemicals, heavy machinery, automobiles and defense industries.

However, many of the traditional industrial enterprises that were established in the 1950s, when China operated under a planned economic system, have become less competitive. Some have been losing money for the past 20 years, during the time in which China implemented the reform and opening policies and moved from a planned economy toward a market economy.

The proportion of the region's industrial output value to the national total dropped to 9 percent from the former 17 percent. Some loss-making SOEs were closed, resulting in mass unemployment.

Premier Wen said last year that China aims to build the northeast region into a national and even a world-class industrial base for equipment manufacturing and important raw materials.

(People's Daily March 24, 2004)