Crucial role of regional coordinated development

The Central Economic Work Conference held at the end of 2021 pointed out that regional policies should enhance the balance and coordination of development. The central government therefore proposes to implement regional major strategies and regional coordinated development strategies, and at the same time requires comprehensive promotion of rural revitalization and improvement of the quality of new urban construction.

Almost all provincial-level authorities are trying to establish one or two cities in their jurisdiction as economic centers through tilting more resources to them. Some provinces are pursuing strategies to strengthen the provincial capitals. While some, concerned about one city dominating, are establishing dual centers.

Compared with cities in other countries, which is often an autonomous economic unit, a city in China is an administrative region. Some prefecture-level cities can easily cover tens of thousands of square kilometers, with a resident population of several million or even tens of millions. The strengthening of the agglomeration effect of the central city will exert a radiating integration pull on the surrounding small and medium-sized cities and the districts and counties within the central city. For instance, Chengdu, capital of Sichuan province, accounts for almost half of the economy of the province, and it is the same for Wuhan, capital of Hubei province. However, this radiation driving effect weakens with distance. Areas farther away are difficult to integrate into the metropolitan area, thus becoming the peripheral areas of the urban agglomeration. In other words, the prosperity of these central cities comes at the cost of the decline of other parts of the province.

The "dual center" model has emerged in some provinces as a way to avoid this problem. For instance, provinces such as Shandong, Zhejiang, Liaoning and Fujian are giving full play to the modern service industry and high-tech industries in their provincial capital cities. At the same time they are strengthening the port functions of their sub-centers, Qingdao, Ningbo, Dalian and Xiamen, respectively, so as to develop relevant industries with comparative advantages, and form manufacturing, logistics and shipping centers. But from this it can be seen that the provinces where the dual-center model is emerging are coastal provinces, and the so-called dual-center is usually because the provincial capital and another large coastal port city exist in this province at the same time.

In other words, the regional coordinated development strategy in the provincial-level regions should take measures in accordance with local conditions.

In provinces that do adopt the one-city development mode, it is necessary to smooth the rational flow and efficient agglomeration of production factors and to rationally share resources between the provincial capitals and their peripheral areas and increase the accessibility of high-quality public services in the provincial capitals to the rest of the province.