Rethinking bullet trains, dams and TV edifice
By Antoaneta Bezlova
BEIJING - Casting a fresh eye on the social cost of rapid economic growth and worried about the overheating of China's economy, the country's leadership is rethinking a series of high-profile projects initiated by its former leaders.
With little fanfare, but enough publicity to drive home the message, the team of President Hu Jintao and Premier Wen Jiabao has signaled that unlike their predecessors, they do not see China as a testing ground for the latest technology.
They also have indicated a wish to adjust government spending to reflect their pursuit of more sustainable economic development and a new emphasis on a "people first" policy.
According to industry insiders, at least three major economic projects have felt the implications of this new populist style of leadership.
Among these is the forerunner of China's high-speed mass transportation - the high-speed railway link between Shanghai and Beijing, long projected to be up and running for the 2008 Beijing Olympics Games. This has now been put on the back burner as the central leadership is busy tackling low rural incomes and growing social inequality.
Amid concerns about over-investment, not only the date for breaking ground on the project has been pushed back, but debates inside the government about which technology ought to be used also have taken unexpected turns.
The new headquarters of the government-controlled China Central Television (CCTV) - a US$600 million (4.96 billion yuan), 530,000 square meter building in downtown Beijing designed by Rem Koolhaas and Ole Scheeren of the Rotterdam-based firm OMA - has also been criticized by Premier Wen because of its steep cost.
Cost-cutting redesign of TV headquarters
Although awarded to OMA by a Beijing-organized architectural jury and CCTV leaders in December 2002, the project is now caught up in controversy after the central leadership reportedly demanded its redesign in order to cut costs. Leaders also have questioned the wisdom of the new CCTV headquarters' location in the capital's prime central business district.
"We do understand new leaders' strategy to revisit all megaprojects of the state and rethink all the money spent on the Olympic effort," says Ole Scheeren, the CCTV headquarters project manager at OMA.
"Yet we believe that there is a consensus among the leaders that they can't discard everything and must carry through with some of the projects. I'm confident that our project would go ahead as scheduled and retain its original design," Scheeren adds.
Another project that has been affected by popular concerns is the construction of 13 dams on the Nu River in China's southern Yunnan province.
Despite continuing power shortages, in April Premier Wen put on hold controversial plans to build the cascade of dams on one of China's last free-flowing rivers, in an area designated a world heritage site for its biodiversity. The surprise move followed a petition campaign by environmentalists and activists.
In the written suspension order, Wen said that the government must proceed carefully and investigate the dam plan thoroughly, particularly since the scientific and environmental communities have expressed alarm over the project.
Chinese leaders' recognition of the need to cool down sectors that are overheating and to bring the overall gross domestic product (GDP) growth rate down to a sustainable level was summarized best by Premier Wen. In his work report to the annual meeting of China's legislature in March, Wen said that the government GDP growth target for 2004 is just 7 percent.
Reining in rampant economic growth
This is a remarkably modest target given that the economy grew by 9.1 percent in 2003 and clocked 9.7 percent growth in the first quarter of this year. Beijing has indicated that more steps will be taken to cool down the economy if current policy tightening measures fail.
Since mid-2003, the People's Bank of China, the country's central bank, has raised bank reserve ratios twice, forcing banks to keep more cash on hand instead of lending it. Beijing also has banned new projects such as aluminum smelters and has cited steel, cement, real estate and automobiles as other areas in need of tighter regulation.
"The Chinese government will gradually phase out its expansionary fiscal policy and slow investment in government-sponsored projects," the Asian Development Bank said in its annual economic forecast released at the end of April.
Yet, more interesting than this commitment to abandon what the government is now calling "the blind pursuit of GDP growth" is Beijing's newfound emphasis on the rights of the people and their potential implications for economic policy.
This emphasis is in part a reflection of Chinese President Hu and Premier Wen's attempts over the past year to portray themselves as "men of the people".
But lending an ear to popular concerns is more than just a political move by the new leaders to consolidate their power base.
Rapid growth can also lead to social unrest
Beijing is also worried about the escalating social cost of rapid economic growth, as evidenced by its pledges to redress the uneven distribution of wealth. A failure by the Communist Party of China to curb the destabilizing effects of China's rapid growth could result in social unrest and threaten the party's future grip on power.
Perhaps most illustrative of Chinese leaders' new policy concerns is the story of twists and turns surrounding the future high-speed railway between Beijing and Shanghai (the Jinghu line).
The construction of the 1,307 kilometer, $14 billion Jinghu line will be awarded through an international bidding process scheduled to begin before year's end. Industry insiders suggest, however, that the two front-running bidders for the project have been losing a competitive edge as Chinese leaders are rethinking their decision-making policy to reflect their "people first" concerns.
The appeal of German-designed magnetic-levitation technology - once thought to be the ultimate favorite for this high-profile engineering project - has been losing luster. China's leaders appear to be less impressed with its technological novelty and more worried by its steep cost ($40 million per kilometer) and its incompatibility with a large and existing infrastructure network.
"Had Zhu [Rongji] stayed in power, we would have been very confident of winning the Jinghu line," says a German official involved in the negotiations about the project. "But the new leadership is less in love with technology. Their priorities have changed and they want to leave a different mark."
Japan's Shinkansen bullet train system also had been a strong candidate as a contractor for the Jinghu line. The train has proved to be a champion in profitability and management efficiency in Japan.
Yet, in another sign of a government more in tune with popular concerns, the central leadership has given little recent indication that it favors Shinkansen's technology.
As it is, the Japanese bid has generated an outpouring of angry nationalistic sentiment. According to media reports, some 80,000 Chinese signed an online petition in August, calling on the government not to award such prestigious project to the country's former invader.
(Inter Press Service)
atimes.com
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Yes, China should use these billions to help the poor. |
