In his speech marking the 40th anniversary of China’s reform and opening-up in Dec 18, 2018, President Xi Jinping called for deepening the opening-up in areas along the coast, the borders and the rivers of China, in order to “form a new pattern of all-around, multi-level and wide-ranging opening-up”. On a national scale, however, the opening-up process in Northeast China has not advanced as rapidly or as thoroughly as in other parts of the country.

Northeast China revitalization is a national strategy. On Sept 28, 2018, Xi pointed out during an inspection tour of Liaoning province that revitalizing Northeast China should be carried out in an all-around way. At present, increasing the level of opening-up is a new measure to revitalize Northeast China.

From a regional view, the timing is good for the Northeast to open wider to the world. Though uncertainties still exist on the Korean Peninsula, tensions have eased in general, and the DPRK has confirmed a new national line in 2018 to sparing no efforts on economic construction. Russia is increasingly looking east for more cooperation in the Asia-Pacific region, which also brings China more opportunities. In addition, the cooperation between China and Japan is expected to come to a new stage.

Based on this, deepening opening-up in the Northeast could focus on “two circles”: one is the economic circle around the Sea of Japan and the other the economic circle around the Yellow Sea and the Bohai Sea.

What’s more, the opening-up in the Northeast should be based on nine key ports including sea ports and land ports. Among them, Dandong, Ji’an, Linjiang and Hunchun are pivotal for cooperation with the DPRK and the ROK. Key land ports toward Russia, meanwhile, include Huichun, Suifenhe, Fuyuan, Tongjiang (bridge), Heihe (bridge) and Manzhouli.

Currently priorities should be placed on cross-border infrastructure construction, trade facilitation and investment liberalization. The complementarity in economic structures between China and Russia, Mongolia, the DPRK and Japan is still very strong, which is the basis for the cross-border cooperation. There are four aspects that could be highlighted.

First, cooperation in industries of equipment manufacturing, oil and gas, agriculture and tourism between China and Russia, the DPRK, the ROK, Japan and Mongolia needs to be deepened.

Second, the export and import of energy, mineral products, timber, agricultural products and seafood and light textiles are also important.

Third, there is big potential in introducing more foreign investment to China and encouraging Chinese investment overseas.

Fourth, infrastructure construction should be emphasized, in particular the highways, railroads, bridges in the port areas.

In the long run, improving the business environment is the core of Northeast revitalization and cross-border cooperation. To this end, efforts should be made in three aspects. The first is the government needs to create an environment for fair play, and should not interfere at will in economic activities and the market. The second is enterprises and entrepreneurs should compete with each other in a legitimate way. The “zombie enterprises” should be dealt with as per related laws and regulations. And foreign enterprises are welcome to compete with Chinese counterparts on the same stage. The third aspect is public awareness of the importance of opening-up should be improved.

Chang Xiuze is professor at the National Development and Reform Commission’s Academy of Macroeconomic Research, and deputy-director of the Expert Committee of the China Academy of Northeast Revitalization.

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