A Study on Adjustment of Benefit Relationships for the Development of China’s Resources-dependent Cities

ZHANG Youxiang¹  , ZHi Dalin ^1,2

1. Faculty of  Economics and Management,Weifang University of Science and Technology, P.R.China, 262700

2. Resources-dependent City Research Center of Northeast Normal University, P.R.China, 130117

Abstract

The transition development of resources-dependent cities is a significant component of Chinese economic transition. As a comprehensive and complicated system engineering, it is not merely the transition of economic structure, but combination with the richness of people, social development and environment management. Driven by fund support and mechanism safeguard, it will promote the upgraded economic transition of resources-dependent cities, harmonious development of society, improved city functions and perfect mechanism, and accordingly realize the sustainable development of resources-dependent cities.

Keywords: Resources-dependent City, Transition Development, Sustainable Development, Experience

1      Introduction

China has 118 resources-dependent cities till now. By types of resources exploitation, they are divided into coal cities, forest-industry cities, oil cities, nonferrous metallurgy cities, ferrous metallurgy cities, and other cities. By stages of resources development, they are divided into depleted, declining, mature, and growing types. Meanwhile, by locations, they are divided into northeast, western, middle and eastern regions. Different locations decide the economic foundation, human social environment, market development levels, local financial and supporting power for transition, which further decide the transition development progress and effect.  

Because of the differences in resource type, development stage and location, the transition development of resource-dependent cities has no uniform model and the measures must be adopted according to the circumstances, time and locations.   

2      Key Problems for Transition Development of Chinese Resources-dependent Cities

2.1 Problems in overall planning and classified guidance

In the transition development of resources-dependent cities, the relationship between the generality and specificity must be properly treated. It means to properly deal with the relationship between overall planning and classified guidance in the policies. The overall planning is the macroscopic guiding framework for transition development of resources-dependent cities. Starting from the general rules of transition development, it makes macroscopic rules with respect to basic principles, primary objective, economic re-structure direction, ecological environment management, social harmony and stability, instead of microscopic requirements and “universal application”. The classified guidance means that the state should respect the specificity of resources-dependent cities, and encourage those cities to choose transition development modes scientifically and flexibly based on their resources and locations. Especially, the national policies support must represent the differences of city types and regions, and give preferential to the transition development of resources-depleted cities in lagged regions. For resources-dependent cities in developed regions, the state shall define the responsibilities and financial supports of local government, and for the resources-dependent cities in growing and maturity periods, the state shall make planning for the transition to prevent the ending-up in “depleted resources and declined cities”. 

2.2 Problems in relationship between resources-dependent industries and resources-independent industries 

The simplicity and fragility of leading industry are typical characteristics of resources-dependent cities. A resources-dependent city is always accompanied by resource exploitation. The development scale and potential of such cities depend on the resource reserves. The development of resources-dependent industry brings along the expansion of city. Meanwhile, the resources-dependent industry greatly relies on the technology and government. As a result, it can hardly get supporting service from the civilian economy, and difficultly adapt to the sharp market changes, which further lead to the simplicity and fragility of leading industry in the city. Once the resource is depleted, the industry will decline and the city will be depressed. The success or failure of resources-dependent cities is all due to the resource. Therefore, the industry transition turns to be the kernel for transition development of resources-dependent cities. To realize the sustainable development of resources-dependent cities, the relationship between resources-dependent industries and resources-independent industries must be properly dealt with. By diversified industry structure, the industry transition brings along the city transition. 

The resources-dependent industries and resources-independent industries are either consecutive or substitute, or the both, to each other.

2.3 Problems in relationship between industry and agriculture, urban and rural of resources-dependent cities

In the economic structure of resource-dependent cities, the industrial production and agricultural economy coexist, the economic and social connections of urban and rural are simple, and the gap between the two fields is huge. As a result, the urban-rural dual economic structure of resource-dependent cities is prominent compared with resources-independent cities. Nowadays, most resources-dependent cities of China have not formed kernel areas with high comprehensive functions and profits, especially no “technology, industry and trading” center shaped as the center of livelihood service and growth point of production, scientific research and business.    It seriously affects the resources-independent industries centralizing to urban, production factors such as population agglomerating to urban and mineral areas transiting to urban, which finally cause the sustainable development of resources-dependent cities impossible. Therefore, in order to realize the sustainable development of resources-dependent cities, the relationship between industry and agriculture, urban and rural must be properly treated. Urban functions are improved and optimized by industrial agglomeration and urban expansion. By cultivating industrial linkage between urban and rural, improving infrastructure connecting urban and rural, mediating the migrant channel of rural population, etc., the gap between resources-dependent city and surrounding rural is filled to change the dual economic structure and gradually realize the harmonious development of urban and rural economies. For this purpose, the first is to keep the urbanization and industrialization parallel, the second is to “quit the city”, “agglomerating to city”, and “expand the city” simultaneously, and the third is to integrate the city transition and new rural construction. 

2.4 Problems in relationship between transition and livelihood improvement of resources-dependent cities

The social stability and livelihood improvement are the essential for transition development of resources-dependent cities. Most leading industries of resources-dependent cities are state-owned, resource-dependent, large-sized or super-sized enterprises. They assumed the responsibility of employment and employed excessive personnel since the period of planned economy, which caused disguised unemployment. Along with the transition of economic system from planning to marketing, the disguised unemployment turns to be dominating, and the unemployed is increasing. When the resource is depleted and the exploiting enterprise faces to shut-down, changing production, and even insolvent, the demand of labor appears linear decrease, which scales the unemployment. Meanwhile, the unemployed workers have single skills and poor industry mobility. It is very difficult for them to be reemployed. As a result, the resident income is reduced to very low or even zero. The livelihood problems such as medical care, education, housing, etc., come into focus. Especially if the social security is not improved and optimized, social conflicts are accumulated gradually, mass petitioners become more frequently, and social unstable factors increase greatly. Therefore, in order to realize the sustainable development of resources-dependent cities, the relationship between city transition and livelihood improvement must be properly treated. Insisting on the principle of human base and social harmony, the improvement of living quality shall be taken as the starting point and result of the transition development. By solving the realistic problems concerning vital interests of the people such as employment, reemployment, housing, poverty, education, and social security, accelerating the development of social undertakings, and emphasizing social fair, the population will share the result of transition development.

2.5 Problems in relationship between economic development and ecological environment of resources-dependent cities 

Environmental pollution and ecological degradation are prominent symptoms of resources-depleted cities. When the resource exploitation brings along the economic development, the coarse exploitation caused the problem of three wastes, and intertwined with the geologic disasters such as water and soil erosion, surface collapse, cracks, etc. It leads to the environmental pollution, ecological degradation, and urban decline, and further the decreased funds inflow, increased talent outflow and lagged urban development. Therefore, environment management and ecology optimization are the essential for transition development of resources-dependent cities. In order to realize the sustainable development of resources-dependent cities, the relationship between economic development and ecological environment must be properly treated. By establishing resources-intensified technical system and production system, the clean production shall be implemented to avoid the old way of “management after the pollution” or “management as the same time with pollution”. It will put forward the economic society to a civilized development track with developed production, rich livelihood, and good ecology. 

2.6 Problems in relationship between financial support of government and mechanism construction of transition development

The shortage of money is the direct difficult for transition development of resources-dependent cities. The shortage of long-term effective mechanism for sustainable development is the deep problem for transition development of all resources-dependent cities. The financial transfer payment from central government relieves the difficult of resources-depleted cities in shortage of money for some time, but it cannot solve the problem of sustainable development for resources-dependent cities from the root. Therefore, in order to realize the sustainable development of resources-dependent cities, the relationship between financial support of government and long-term effective mechanism construction for sustainable development must be properly treated. In respect of financial support, the financial transfer payment from central government shall not only considers the regional differences to properly deal with the relationship between key regions and general regions, but also distinguishes the type of cities to properly deal with the relationship between resources-declining or depleted cities and resources-growing or mature cities, and between central urban and surrounding rural in resource-dependent cities. Moreover, the time span of financial support shall be mastered to properly deal with the relationship between long term and short term supports. The collocation with project support and mechanism construction must be emphasized to properly deal with the relationship between the “blood transfusion” and “hematopoiesis” supports. In respect of long-term effective mechanism construction for sustainable development, a long-term effective mechanism for sustainable development of resources-dependent cities shall be established as soon as possible through the country, including the pricing mechanism for resources-dependent products, early-warming mechanism for industrial decline, supporting mechanism for resources-dependent enterprises, compensation mechanism for ecological environment, aid mechanism for consecutive industry, sustainable development mechanism for regional economy, etc.  

The properly treatment of relationship between financial support of government and long-term effective mechanism construction for sustainable development is in fact to integrate the startup effect of financial support with the long term effect of mechanism construction. The major-minor relationship as well as precedence relationship of the two will be distinguished by the regional differences, city types and time spans, in order to make full use of their advantages to realize the sustainable development of resources-dependent cities.

3       Conclusion

The problems of resources-dependent cities directly relate to the areal specialization shaped by the planned economy and resources mobilization mechanism in the progress of industrialization, the residuals of economic-construction-oriented government, and unconscionable taxation policies. It is impossible to realize the transition of resources-dependent cities only by market economy. The government shall assume the historical and institutional responsibility. Therefore, in order to realize the sustainable development of resources-dependent cities, the relationship between city transition and mechanism reshuffling must be properly treated. Based on the idea of “reshuffling the mechanism before transition” and following the law of market economy, the mechanism reform must be deepened sufficiently to guarantee the city transition. For this purpose, the first is to properly deal with the relationship between government guidance and market adjustment. Insisting on the government leading, market impulse and mass participation, making full use of the control effect of governmental and market actions on the transition development of resources-dependent cities, the mechanism reforms in industrial development, social security, ecological construction and cit transition will be accelerated for resources-dependent cities. By mobilizing all active factors in the region and striving for support and cooperation both home and abroad, diversified investment system will be established to form the controlling, operating and supervising mechanism for transition development of resources-dependent cities satisfying the law of market economy.  The second is to properly deal with the relationship between the central and local governments, clarifying the responsibilities and work divisions. The central government shall intensify the financial transfer payment to sustainable development of resources-dependent cities, and establish the financial supporting mechanism of classified guidance, two-way and rolling promotion to expand the scope, level and term of financial support and to help resources-dependent cities step onto the track of sustainable development. Moreover, it shall put forward the establishment of long-term effective mechanism for sustainable development of resources-dependent cities, for example, making legislation on the sustainable development of resources-dependent cities as soon as possible, improving the reserve system for sustainable development of resources-dependent enterprises, setting up special-purpose loan for sustainable development of resources-dependent cities, and timely implementing the reform of resources taxation, etc.  As to the local government, the provincial government shall timely amend the assessment criteria for transition development of resources-dependent cities, and intensify the guidance and support to transition development of resources-depleted cities. The local government of resources-dependent cities shall strive for the policy and capital support from the state and province, and positively promote the reform of economic administrative system, make full use of preferential policies and fund to improve the effect of transition. Reform of property rights system centered, it shall carry out diversified modes of leasing business, assets reorganization, separation of the auxiliary body from the main body, private equity participation, transfer of social functions, foreign cooperation, etc. By this way, the reform of local state-owned enterprises is deepened all-round to realize the diversification of investing body and build new-type enterprises. The government shall also promote the reform of investment and financing mechanism to bring in foreign banks and venture capital fund. In addition, it shall improve the public service level by public facilities extending to the rural and public service covering the rural.

Communication Author: ZHANG Youxiang

Address: School of Economics, Norhteast Normal University, Jingyue Ave, Jilin Province

E-mail: zhangyx263@nenu.edu.cn

Tel: 0431—84537670, 18943947377

References

[1] Some Opinions of the State Council on Promoting the Sustainable Development of Resource-dependent Cities , National Issue (2007) No.38, 2007-12-18.

[2] Development and Reform Commission of Jilin Province, Resources-dependent City Research Center of Northeast Normal University. The “Twelfth Five-Year” Development Planning for Economic Transition of Resources-dependent cities in Jilin Province , 2010.

[3] Baishan Municipal People’s Government, Resources-dependent City Research Center of Northeast Normal University. Assessment Report on Transition Effects of Baishan—A Resource-depleted City , 2010.

[4] Dunhua Municipal People’s Government, Resources-dependent City Research Center of Northeast Normal University. Assessment Report on Transition Effects of Dunhua—A Resource-depleted City , 2010.

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