The Role of Local Government in Developing Economy

Wanxia Li16th, Feb., 2012

CLL, The University of Warwick

CONTENTS

Taking Songjiang District of Shanghai Taking Songjiang District of Shanghai Municipality as an example.Municipality as an example.

The Comparison with UK Counterparts.The Comparison with UK Counterparts.

China is the second largest economy in the world

Gross Domestic Product 2010) Above US$ 6 trillion 11.3% growth, Second after U.S. (14 trillion)

Imports and Export US$ 3 trillion 35% growth (import: 1.4 trillion, Export: 1.6 trillion) Second after U.S.

Foreign Direct Investment Above US$100 billion, up 17.4%, Ranked 1st in developing country

Foreign Currency Reserve US$ 2.8 trillion , ranked 1st in the world

Why? Two possible answers?

The developmental state? The developmental state? These two differing orientations toward private economic These two differing orientations toward private economic

activities, the regulatory orientation and the developmental activities, the regulatory orientation and the developmental orientation, produced two different kinds of business-orientation, produced two different kinds of business-government relationships. The United States is a good government relationships. The United States is a good example of a state in which the regulatory orientation example of a state in which the regulatory orientation predominates, whereas Japan is a good example of a state in predominates, whereas Japan is a good example of a state in which the developmental orientation predominates. ---which the developmental orientation predominates. ---Chalmers Johnson, (1982). MITI and the Japanese Miracle. Chalmers Johnson, (1982). MITI and the Japanese Miracle. Stanford, CA: Stanford University Press. Stanford, CA: Stanford University Press.

The local governments of China?The local governments of China?

The Map of Songjiang District

Songjiang : one of Shanghai’s 16 districts

Area: 605 Sq.km.10% of Shanghai

Population:1.46million6% of Shanghai

Industrial Output:335.4 billion

13.47% of Shanghai

Two Transformations of Songjiang

Urbanization ： From an mainly rural area into mainly urban area

Two Transformations of Songjiang

2005

1990

2003

1953

213000

116700

10,000

0.5

2007

2010

353800

433800MillionRMB

Year

Industrialization : From an agricultural area into exporting center

The Roles of Government

The Roles of Gov.

Economy Adjustment

Public ServiceMarket Supervision

Society Management

The Main Functions of Local Government

To make the decisions

To find the Resources

To provide the Services

The Location of Songjiang Government

The Annul Fiscal Revenue of Songjiang

Events

Shanghai government approved itShanghai government approved it1994.05

1990.12 Hu-Song High way opened to trafficHu-Song High way opened to traffic1990.12

2001 Songjiang New City started to builtSongjiang New City started to built

Events

Started to Extend Metro No. 9Started to Extend Metro No. 92009.12

Thames Town opened Thames Town opened 2006.10

1990.12 University Town started to builtUniversity Town started to built2002.08

2007.12 Metro No. 9 opened to trafficMetro No. 9 opened to traffic

Songjiang New City(2001- )

Songjiang New City

Thames Town(2002- )

Finding the Resources

offeringoffering creating creating chasingchasing

Capital

Land

Policies

Borrow money

Establish Companies

Attracting Investment

the approval of higher level

Resources-Offering

+200 hectare land 30million RMB

Songjiang Industrial Zone

(1992- )

Songjiang Export

Processing Zone (2002-)

Songjiang University Town (2002- )

Resources-creating

Purpose Companies

For Industrialization Songjiang Industrial Zone Co., Ltd.

Songjiang Export Processing Zone Co., Ltd.

……

For Urbanization Songjiang New City Construction Co ， Ltd

Songjiang Fangsong Construction Co. Ltd

Songjiang University Town Construction Co., Ltd.

Songjiang Metro Line Construction Co., Ltd.……

Metro Line 9

Resources-Chasing

Providing Services

Demolish

1

Service teams

3

Coordination Panel for the Key projects

2

Comparison

1. Different development stage 2. Different definition of local government 3. Different structure of local government 4. Government and Governance 5. Different expectation of local government

Comparison

One thing important in common?

CLL, The University of Warwick