China's Largest Manufacturing Base Lowers Economic Targets

Huang Huahua, governor of Guangdong, announced the economic goals while delivering a work report of the provincial government at the local people's congress that opened here Friday.

However, the report last year set the export increase and GDP growth to 10 percent and 9 percent, respectively.

"How to deal with the economic crisis, company closures, and unemployment are the most concerning issues among deputies to the congress," said Tan Yanhong, vice general manager of Guangzhou Grandby Co., Ltd.

"The whole province has to make great efforts to achieve the 8.5-percent growth at this extremely hard time," said Huang.

Guangdong's annual import and export value makes a third of China's total. More than 40 percent of its export was shipped to the United States. As the U.S. demand slackens during the economic crisis, Guangdong suffers the most.

"Guangdong may face more difficulties, including unemployment and social security problems, in a short period of time as export keeps falling," said Xiao Pengfei, a professor with the Guangdong University of Foreign Economic and Trade.

However, the central government has been closely watching Guangdong and the Pearl River Delta, where many factories have closed or cut work forces because of a drop in foreign orders.

According to a new plan released last month by the National Development and Reform Commission, China's top economic planner, the region, which has long been a laboratory for China's market economy experiments, will be turned into a base for advanced manufacturing, innovation and heavy industry as of 2020.

It will be a new test field for more economic reforms while opening up wider to the world. The delta, together with bordering Hong Kong and Macao, will be forged into "a globally competitive" and "vigorous area in the Asia-Pacific region," according to the blueprint.

In order to achieve the fixed economic targets this year, Huang said Guangdong plans to invest 303 billion yuan (44.33 billion U.S. dollars) in 200 key projects, which is expected to draw another 1.3 trillion yuan from the society and stimulate domestic demand.

The projects cover high-speed railways, expressways, nuclear power stations, ship manufacturing, maritime engineering, aviation industry and new energy powered automobiles.

Huang promised to increase spending for social medical care, educational and cultural activities to ensure the quality of life for low-income households.

In addition, the province will work to explore new foreign markets, such as Southeast Asia, Africa, South America, Middle East and Russia, to allow more exports of high-tech and mechanical and electronic products.

Some deputies attending the five-day provincial people's congress said they would raise proposals on tax rebate, distributing consumer coupons, subsidizing people for traveling to boost domestic consumption.