A plan to revitalize northeast China was passed by the State Council on August 2 and posted on its website five days later.

The long-awaited blueprint will lend a strong hand to the country's former industrial bases, including Heilongjiang, Jilin and Liaoning provinces, and the eastern part of the Inner Mongolia Autonomous Region, and help them catch up with other regions and achieve economic prosperity.

Under the plan, the region will be redeveloped into an equipment-manufacturing center able to compete on the world stage. It will also be a base for energy, raw materials, commercial grain and agricultural products, and stock breeding products.

In addition, it is expected to play a major role in technical research, development and innovation, as well as protecting the environment.

With its new look, the Northeast should become a key region with brisk and balanced economic growth.

The plan is heartening for all those who care for the Northeast. After all, it was once the nation's industrial powerhouse, shortly after New China was founded in 1949.

The region saw a weakening of its position in the national economy after the launch of the economic reforms in the late 1970s.

Figures show that in 1980, the economy of Guangdong Province was about half that of Liaoning's. By 2001, Guangdong's economy was 1.6 times the size of all three northeastern provinces combined.

The Northeast has a firm foundation in industrial development. It retains its advantages in equipment manufacturing and technology while the local labor force is well trained. It has the potential at least to achieve brisk and balanced economic growth.

The plan seeks to tap this potential and develop a base for equipment manufacturing with an international competitive edge. This would feed such industries as shipbuilding, iron and steel-making, automobiles and aircraft, which have been growing in recent years.

The Northeast has already enjoyed impressive growth in the manufacture of heavy machinery, complete set equipment, digital control machine tools, aircraft and automobile parts and rail transportation equipment. These industries are now at a good size but have potential for further growth.

However, the Northeast will need help to establish a competitive edge beyond its traditional advantages.

This could come from one of the other objectives of the plan, which is to develop the region as a center for technical research, development and innovation.

Being both capital and technology intensive, equipment manufacturing relies increasingly on technological developments. By keeping ahead of the competition in the development of new technologies, the Northeast can build its competitive edge.

The region should also be open to technological research and development bases around the country. And it is necessary for it to cooperate with foreign companies to get access to the technologies it needs.

The Northeast will also serve as a base for new raw materials and energy for the country, with its leading industries being iron and steel, chemicals and oil refining. These sectors are the main engines for the regional economy.

The Northeast must also become more environmentally friendly: Neither the manufacturing processes nor the finished products should pose a threat to the environment. Also, all products should be developed to maximize their added value.

The region could provide a valuable source of new energy, through the development of wind farms or nuclear power plants. These energies are far less damaging to the environment than petroleum or coal.

For decades the Northeast has made a significant contribution to the nation's food security with its grain output. So it is only natural for the region to continue to develop this area of expertise.

However, prudence is needed when planning the agricultural layout of such a vast and diverse area.

The grasslands of east Inner Mongolia, for instance, play a key role in the fight against desertification, and should not therefore be turned into farmland.

Similarly, the Greater Hinggan Mountains should be protected as part of national ecological efforts.

All of the targets outlined in the plan show promise, but there is a long way to go before they become reality.

Both the central government and local governments in the Northeast should offer favorable policies to businesses to aid innovation and development. Also, investors and technology holders from around the world should be encouraged to work in the Northeast.

Another key element needed to rejuvenate the Northeast is for local governments to find a proper position for themselves in the market economy.

On the one hand, they should offer guidance and aid to businesses and ensure market order. On the other, they should refrain from meddling into the market or businesses directly.

When both businesses and the government begin to reap the benefits, the Northeast can move jubilantly toward a brighter future.

The author is a researcher with the Institute of Industrial Economics under the Chinese Academy of Social Sciences

(China Daily August 16, 2007)