Economic Implications of China's "Go-West" Policy: A View from Thailand
Phanishsarn, Aksornsri, Journal of Southeast Asian Economies
This research note analyses China's Great Western Development Strategy, or the so-called "Go-West" policy, launched in 2000, and its implications for Thailand. Under this regional economic development policy, the Chinese Government has intensified its efforts to accelerate the development of its inner western region. Thailand's geographical proximity to China's western provinces provides it with a geo-economic advantage. The study suggests that Thailand should place priority on developing economic linkages with the growing southwestern provinces of Sichuan, Chongqing Municipality, Yunnan, and the Guangxi Zhuang Autonomous Region.
Keywords: economic linkages, China's "Go-West" policy, Thailand, China's southwestern provinces
The People's Republic of China embarked on economic reform and has gradually opened the country to the outside world since 1979. As a result, the Chinese economy grew at an extremely rapid pace over the last two decades. However, the rapid growth, which took place mainly in the eastern coastal region, caused a large disparity in economic development between the east and the rest of the country. Recognizing this, the Chinese Government decided to revise the direction and policy of its regional economic development. The result of this revision is the China's Great Western Development Strategy, or the so-called "Go-West" policy, which puts greater emphasis on the development of the relatively backward and mostly inland western region. The purpose of this research note is to examine how this policy came about, and to assess the implication of this "Go-West" policy for Thailand.
The remainder of this research note is divided into four sections. section II examines the situation leading up to China's policy for regional economic development. Section III analyses the necessity of the "Go-West" policy, how it came about, and the essential ingredients of the strategy. Section IV covers the economic potential of the important western provinces, with emphasis on the four provinces located closest to Thailand, namely: Sichuan Province, Chongqing Municipality, Yunnan Province, and the Guangxi Zhuang Autonomous Region. section V ends with an analysis of the implications of China's "Go-West" policy for Thailand, with an emphasis on the opportunities for economic linkages with the four aforementioned provinces.
II. Background to the Policy on Regional Economic Development in China
II.1 China under Mao Zedong (1949-78)
The first stage of economic development in China, under the leadership of Mao Zedong, emphasized the development of a self-sufficient economy, and the government considered the inner rural region of China to be a "strategically significant area". This regional development policy stressed the importance of the inner region, and actively supported more investment in the landlocked regions. The national economic policy of China, based on the Third Five-Year Economic Development Plan (1966-70), was to develop its own industries. The State Council poured subsidies, raw materials, and labour into rural areas in the interior region. Accordingly, each area promoted its own industrial production, especially heavy and military-related industries. However, as the inner region of China was both backward and unproductive, this policy incurred a very high economic cost, resulting in production inefficiency, and did not generate sufficient economic return. This policy also contributed to a slow-down in the development of the eastern coastal region, with its greater economic potential. Therefore, industrial policy under Mao led to an imbalance in the geographic distribution of the industrial sector.
II.2 China in the Economic Reform Period (1978-present)
In late 1978, under the helm of Deng Xiaoping, China adopted an economic reform and openingup policy, which led to major changes in the country. The Chinese leadership switched their …
Questia, a part of Gale, Cengage Learning. www.questia.com
Publication information: Article title: Economic Implications of China's "Go-West" Policy: A View from Thailand. Contributors: Phanishsarn, Aksornsri - Author. Journal title: Journal of Southeast Asian Economies. Volume: 23. Issue: 2 Publication date: August 2006. Page number: 253+. © 2008 Institute of Southeast Asian Studies (ISEAS). Provided by ProQuest LLC. All Rights Reserved.
This material is protected by copyright and, with the exception of fair use, may not be further copied, distributed or transmitted in any form or by any means.