Special Report 

THE DRAGON'S TAIL: CHENGDU AND CHONGQING ANCHOR WEST CHINA ADVANCEMENT

by Dr. Susan Walcott *

      Proclamation of China’s “Great Western Development” policy (Xi Bu Da Kaifa) in June 1999 signaled a major escalation in resources and attention focused on decreasing the development gap between the east coast powerhouses and the twelve inland provinces of the increasingly lagging western region. Comparing the economic performance of east coast and western provinces based on gross domestic product (GDP) generated from 1980-2000 finds the ratio gap increased steadily from 2.98% to 4.33% - a clear indication of the yawning disparity divide. The critical question remains as to whether preferential policies will prove sufficient to transform western areas by utilizing strategies developed elsewhere.

 

      This article examines evidence from two of the three major cities in western China: Chongqing, since March 1997 a national-level municipality with the largest area and population in China, and Chengdu, the historic capital of Sichuan province and close neighbor to the west of Chongqing. Within the western region these two cities rank first and second (respectively) in GDP in 1999, or 8^th and 12^th for urban areas within China. Government policies formulated to favor the West in the modern period impacted Chongqing when that city became the capital of the Nationalist Chinese government, by virtue of its mountain fastness, following the Japanese invasion. The cities of Xi’an, Chengdu, and its suburb “Technology City” Mianyang remain the most advanced research bases in west China for products with high technology inputs.

     

      With a population of 31 million (4.8 million in the urban core) and a declared political area of 82,000 sq. km. in 2003, Chongqing remains primarily a manufacturing town.  Building on its base as a “Third Front” military-industrial site from 1966-75, Chongqing’s industries now produce “dual use” (military/domestic) products such as motor vehicles, electronics, and a pharmaceutical chemical industry.  The national government signaled a major policy change in the city’s profile in 1997 when it raised Chongqing to the level of a national municipality. Chongqing’s status elevation coincided with its role of absorbing an estimated 85% of the 1.2-2 million rural population displaced by construction of the Three Gorges Dam. Ambitious urban development projects within Chongqing’s Economic Urban Region include the Economic Technology Development Zone on the southern edge of the city, the High and New Technology Development Zone to the west, and a massive high technology corridor to the north.   (Continues to next page)      

 

* Dr. Susan Walcott is Associate Professor, Associate Director of the China Research Center,  and  the Director of the Asian Studies Center at Georgia State University.

CHINESE JEWS RETURN TO HARBIN, SEE A BRIGHT FUTURE

by Dr. Jonathan Goldstein*

     On September 2, 2004 when Teddy Kaufmann, President of the Tel Aviv-based Association of Former Jewish Residents of China, recited the prayer for the dead at the grave of Harbin’s long serving Rabbi Aharon Kisilev, an entire cycle of Jewish history in China came a full circle.

      Among Kaufman’s entourage at Harbin’s Huang Shan Cemetery were over one hundred returning residents, their children, grandchildren, and scholars of Chinese and Jewish history from China, Israel, Australia, England, and America.  Some of these people, such as former Israel Railways General Manager Freddy Heyman, had not visited the graves of their parents or other kinfolk since they left for Israel over fifty years ago.  Still others, such as Beijing-based journalist Israel Epstein, never left China.  Epstein returned to the scene of his boyhood in an official limousine, provided to him in his capacity as a member of China’s National People’s Political Consultative Congress.  Chinese policemen snapped to a smart salute when Epstein’s red-flagged vehicle and police escort sped by.

      The truly remarkable aspect about the returnees’ visit, which coincided with a four-day historical seminar on the history of the Harbin Jews, was the ideological breadth of the participants.  They ranged from Epstein and the Communist Party and People’s Government chiefs of Harbin to Yana [Yaakov] Liberman, once chief of staff of Menachem Begin’s right-wing Herut party.  Liberman’s much-photographed handshake with Epstein aboard a Sungari River sightseeing boat was as ironic as Richard Nixon’s February 1972 handshake with Mao Zedong.  Speaking on behalf of all the returnees, Liberman said that two words summarized everyone’s sentiments towards China:  “thank you,” to the Chinese people for giving European Jews hope and haven during a century of pogroms and Stalinism, Hitler and Holocaust. (Continues to next page)

      *Dr. Jonathan Goldstein is Professor of History at the State University of West Georgia, was one of the Western scholars who delivered papers at the August 29-September 2 “International Seminar on the History and Culture of the Harbin Jews,” held in Harbin, China. 

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Center News

THE CENTER HOLDS ITS ANNUAL ASSOCIATE MEETING

      The annual associate meeting of the China Research Center was held on September 18, 2004 at Georgia State University. Dr. Prime  reviewed the major activities of the CRC since the 2003 annual meeting, as laid out in the annual report. The associates have agreed to redefine CRC as "a greater Atlanta multi-institutional academic China center."  By-laws were adopted and a new five-member Board of Directors was elected.

THE CENTER WELCOMES TWO NEW RESEARCH ASSOCIATES

     Dr. Jerome Legge is Professor of Public Administration and Associate Dean in the new School of Public and International Affairs at the University of Georgia.   Dr. Legge teaches graduate courses in research methods and program evaluation in the Department of Public Administration and Policy.   He has also conducted training courses on public policy in China.  His major research interests with respect to China are population policy and gender issues.  

     Dr. Karin Myhre earned her Ph.D. from the University of California, Berkeley.  She has taught at Swarthmore and Grinnell Colleges, and now teaches Chinese language and literature at the University of Georgia where she is assistant professor of comparative literature.  Dr. Myhre has wide-ranging interests in history and contemporary culture and visual and dramatic arts in China, as well as literature and language. 

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China Events

CHINA BUSINESS FORUM ON ASSET MARKETS AND LOGISTICS HELD AT KSU

 by Dr. Penny Prime

      A workshop for area businesses was held at Kennesaw State University on Oct. 8^th.  The forum was organized by the Center and sponsored by DAC Management Inc. based in Chicago.   Over 70 people gathered to network and to learn about the current business environment in China.

Asset Markets

      The first panel focused on China’s recent push to privatize state-owned companies and the distressed asset market development resulting from the new rules regulating ownership and sales of state assets.   Phil Groves, President of DAC Management, LLC., spoke about the opportunities and process of assessing companies and properties, and participating in bids and acquisitions.  There is currently a major move to privatize state-owned companies, and foreign investors can now more easily purchase shares or buy some of these companies out right.  In addition, while the banking system still cannot sell bad loans directly, the four state-owned Asset Management Companies can and the pace of these sales has picked up recently.  China is seeing foreign companies move into this market, such as the Carlyle Group, but also some have decided to move on, such as Lone Star Funds.  Despite the mixed signals, Mr. Groves expects these opportunities to increase substantially in the future and to spread to new industries as well, including mining, power and infrastructure. 

      John Ray, President of Heritage Capital Advisors, spoke about the many new opportunities in China but also emphasized the importance of doing one’s homework before investing.  He stressed that many big companies’ mistakes stem from a lack of partnering and willingness to learn.  Mr. Ray was very optimistic about the growing business relationships between Georgia and China.   

      Truc To, a principal at KPG LLP in the Transaction Services practices, shared some observations based on recent work with major multinationals doing business in China.  From what he has seen, the growing market system combined with some rotation of public officials has meant a decrease in the importance of guanxi or relationships in doing business in China.  The intellectual property rights situation has improved a bit, but still represents a major challenge for most companies.   In addition, basic management knowledge within China is weak, making it more difficult for multinationals to work well in China.  However, he added, that many current and would-be managers are working on MBAs, and are gaining valuable experience in their current positions. 

Logistics

      The second panel dealt with logistics issues in moving parts, materials and final goods within China, and to and from China.  Dr. Chip White, the Director of the Logistics Institute at Georgia Tech, gave an overview of global trade and China’s increasing role in that trade.  He discussed the bottlenecks that have emerged in logistics in the face of rapidly growing demand, combined with the inadequate infrastructure left from decisions made under the former planned system.  While China is investing large sums of money to improve their transport and energy capacity, there are major challenges at the moment.  He cited statistics that indicate logistics represents a very high 18-20% of gross domestic product in China, while in India the figure is 13% and only 9% in the U.S.

      Paul Foster, Vice President of OEM and Asia Sourcing for Lithonia Lighting, a division of Acuity Brands, Inc., gave a detailed analysis of his company’s approach to getting product from factories in China to their markets in the U.S.  Acuity has developed its own logistics system and metrics to keep track and improve their efficiency of moving product.  While adding a China piece to their global strategy, Acuity has pursued a blended approach where they keep some production capacity at home.   

      Representing the Third Party Providers in logistics services, Max Ward, Director of IT at Global Link Logistics, talked about how his company brings producers, companies and transit services together using the web with specially designed software to coordinate logistics.  Global Link has many clients doing business in China and will soon open offices there.     

Sponsors

      In addition to DAC Management, co-sponsors of the forum included the Center for International Business Education and Research at Georgia Tech, Continuing Education  and the Department of Economics & Finance at Kennesaw State University.

CHINESE ECONOMISTS SOCIETY HOLDS ITS ANNUAL U. S. CONFERENCE AT GEORGIA TECH.

      The Chinese Economists Society (CES) is an academic organization dedicated to understanding China’s economic transition.  The organization was started by Chinese scholars studying economics overseas, and has grown into an international organization.  CES hosts two conferences each year—one in China and one in the U.S.  In July, the CES 2004 U.S. conference was held at Georgia Tech.  China Research Center Associate, Dr. Haizheng Li, was the principal organizer of the conference.  Approximately 80 scholars from around the world attended.  In addition to Georgia Tech, several Chinese institutions were among the major financial sponsors of the conference, including Huazhong University of Science & Technology in Wuhan, Tianjin University of Finance & Economics, and Hunan University.    

      The conference began with three keynote speeches given by Professors Gregory Chow, James Heckman and Gongcheng Zheng.  Professor Chow is very well known for his work in econometrics, and his work on China.  He gave an overview of how he sees China’s transition progressing, and data and other issues that scholars need to think about carefully when doing analysis on China. 

      James Heckman, a Nobel Laureate in Economics and professor at the University of Chicago, presented a paper that argues for new econometric techniques to take unobservable individual characteristics into account in estimating the return to human capital.  He applied this approach to a study of human capital in China, emphasizing that the marginal returns to education are what matter, but that returns are heterogeneous across individuals.  Solving this problem would help inform policy makers on the best use of scarce investment resources.

      The third keynote was given by Professor Gongcheng Zheng, who is a member of the Standing Committee of the National People’s Congress of China and teaches labor studies at Renmin University in Beijing.  Professor Zheng talked about the current situation of education in China and future reforms of the Chinese education system.     

      Georgia Senator Sam Zamarripa addressed the conference during the luncheon following the keynotes.  Senator Zamarripa has been a leader in building ties between Georgia and China.  He talked about the long, rich history of China, but argued that people in the two countries are only beginning to understand one another.  Better understanding will be critical to successfully managing this relationship that is growing increasingly inter-related.  The Senator discussed the growing fear over the loss of jobs in the U.S., and the focus on China by many who have these fears.  He argued that a key challenge will be resolving differences while establishing and maintaining free and fair trade.

      During the next day and a half, participants attended a series of concurrent sessions with paper presentations on a wide range of topics relating to human capital, technology and China’s development.  Selected papers will be published in a special issue of the journal China Economic Review, and in an edited conference volume.

PROFESSOR NI GAVE TWO LECTURES DURING AN ATLANTA VISIT

      Dr. Shixiong Ni, Professor and Dean of the School of International Relations and Public Affairs, and Director of the Center for American Studies at Fudan University, China, gave two presentations in the Atlanta area in August.  The first focused on "China's Peaceful Rise and Its Implications for the World" at Georgia Institute of Technology on August 26th.   

      The second lecture was hosted by the Halle Institute and the Department of Russian and East Asian Languages and Culture at Emory University.  Professor Ni’s topic was “U.S.-China Relations from a Chinese Perspective.”  In this talk Professor Ni outlined the progress, problems and prospects of U.S.-China relations beginning in 1979 with normalization of relations.  He concluded that the new leadership under Hu Jintao was focusing on China’s neighbors, other developing countries, and the big powers, but that the big powers, and the U.S. in particular, was probably the most important.  The Halle Institute hosted a dinner for Professor Ni and local area academics following the presentation. 

      Dr. Ni is one of the top Chinese scholars of international studies. He did postdoctoral research at Harvard University; made many lecture visits to the USA as a visiting professor at different universities, such as Columbia University, Georgetown University, George Washington University, Harvard University, and UC Berkeley.   

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Atlanta Area China Related Educational Programs

ASIA COUNCIL'S 2005 SUMMER STUDY IN CHINA--GENERAL STUDIES PROGRAM

by Dr. Baogang Guo

      The  Summer Study in China-General Studies Program is sponsored by the Asia Council of the University System of Georgia (USG). The program will be conducted over four weeks beginning in mid-May at Zhengzhou University, Zhengzhou, China. The dates of the program are  May 11 through June 7, 2005. The academic theme of this year’s program is “Discovering China and Forming a Comparative Worldview.” Five participating faculty members will offer ten courses, including criminal justice, education, history, and political science.  Students can earn six semester hours of credits. All instructions will be in English.

      The program will begin with an educational tour of Beijing. On-site lectures and tours of famous cultural and historical sites will be given. While in Zhengzhou, three out-of-town short field trips to Luoyang, Kaifeng, and Dengfeng, and one weekend excursion to Xi’an ,will be offered. Students will be able to explore some of the fantastic Chinese historical and cultural sites. Course-specific local field trips will also be arranged while in Zhenghzou. Short non-credit courses may be offered based on student’s interests.

      The package cost is $2,890 for the four-week program.  The cost includes the following items: round trip airfare from Atlanta to China, local transportation for all group activities, accommodations in the host cities, most meals on campus and during group tours, visa processing fees, group excursions, and admission costs to museums and attractions. The package cost does not include tuition, textbooks, passport and related expenses, spending money, ground transportation to or from the U.S. Airport through which flights will be scheduled, or other costs beyond those listed above. To download application forms and program brochure, please visit the program's web site at: http://www/daltonstate.edu/china, or contact the program's director Dr. Baogang Guo via email: bguo@em.daltonstate.edu.

ASIA COUNCIL'S 2005 SUMMER STUDY IN CHINA--CHINESE LANGUAGE PROGRAM

by Dr. Gao Yan

      The  Summer Study in China--Chinese Language  Program is sponsored by the Asia Council of the University System of Georgia (USG).  It is an intensive six-week language program, which offers three courses with 9 semester credits in Chinese language and culture, language & cultural practicum, and Chinese for Business & Technology.  The courses are taught by the program teachers and teachers of Yangzhou University.  Students study in small classes of three to four people in the morning and do practicum in the afternoon and evening.  Students are required to write a 200-character journal entry four times a week based on their experiences while in China.  In addition they attend lectures on different topics of Chinese culture, have business site visits, and cultural activities.  They participate in weekend excursions to Beijing, Nanjing, Zhenjiang, Suzhou, and Shanghai,  and also participate in a long free weekend for their own travel plans.

      The program begins with a long weekend in Beijing touring many historical sites in and around the capital including the Great Wall, Forbidden City, Temple of Heaven and Tian’anmen Square.  From Beijing, students travel via overnight train with soft sleepers south to our beautiful host city of Yangzhou on the Yangzi River in Jiangsu Province.  Students live and attend classes at the Overseas Students Residence on campus.  The residence includes a cafeteria, classrooms, laundry facilities, and a small kitchen.  The double rooms are comfortable and equipped with air-conditioning, beds with sheets and blankets, desks, ample closet space, and an attached bath (toilet, sink, and shower) with Western fixtures.  The rooms are pre-wired and internet-ready. 

      Over the past eight years, the program had almost 100 participants from eleven state and private universities and colleges in Georgia and Alabama, and about one fourth of the participants returned to China to either teach English or do business.  This program is open to all university students in Georgia.  We hope to see students from more universities in the coming year.  For further information, please contact Dr. Dan Paracka at dpracka@kennesaw.edu or the program director Dr. Yan Gao at ygao@cau.edu.

ON-LINE CHINESE LANGUAGE COURSE OFFERED BY THE UNIVERSITY SYSTEM OF GEORGIA

by Dr. Xiaoliang Li

      On-line Chinese is designed for students who want to learn Chinese on a flexible schedule.  All course materials are delivered online.  In addition to working on the online materials at students' own convenience, there will be two virtual-classes weekly featuring lecture/conversation sessions with the instructor. 

      This course focuses on proficiency in Chinese in the kind of practical situations one encounters when communicating with Chinese in China. Integrating audio/video, texts, worksheets and the computerized drill/conversation materials, this course will encompass a total of four semesters' learning.  It is designed as an equivalent to classes at the university level. For more information, please contact the School of Modern Languages at Georgia Tech, 404 894 7327; or email Dr. Xiaoliang Li at: xiaoliang.li@modlangs.gatech.edu; or visit: www.usg.edu/oie/initiatives/chin/

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Up-coming Events 

GEORGIA ESTABLISHES A GEORGIA CHINA ALLIANCE

      Georgia China Alliance is a professional association of business leaders who aim to increase Georgia’s business activity with China.  Georgia’s business strengths, established presence overseas and geographically advantageous location make it a perfect fit to build partnerships and benefit from these opportunities.

      The charter meeting of the group will be held on Wednesday, November 10, 2004 at 5:30 p.m. at the 191 Club at 191 Peachtree Street in downtown Atlanta.  To find more information about the Alliance, and to RSVP for the 10^th, please go to www.georgiachina.com.

HONG KONG COMMISSIONER TO USA WILL SPEAK IN ATLANTA ON DEC. 2, 2004

      The Hong Kong Economic and Trade Office (NY) and the Hong Kong Association of Atlanta is going to host a luncheon with Miss Jacqueline Willis, Hong Kong Commissioner to the U.S.A. Miss Willis will make a presentation on "Hong Kong: Gateway to Dong Business in China and Asia." The event will take place at the Capital City Club, Venetian Room, 2nd Floor, 7 Harris Avenue in Atlanta from 11:30 am to 1:00 pm on Thursday, December 2, 2004. Business attire. Valet parking available. RSVP by November 26, 2004. Cost: member: $35, corporate tables: $280, non-members: $40. Please make checks payable to the Hong Kong Association of Atlanta, Inc. and send to 3340 Peachtree Road, Suite 1800, Atlanta, GA, 30326. Please also include your name, phone number, address and fax number when you make the reservation. For further information, please contact Mr. Gere Hanratty or Ms. Micki Kim at 404-238-0875. Email: hkica@mindspring.com.

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Associate News

• At the Center's annual meeting on Sept 18, 2004, Dr. Susan Walcott and Dr. Rong Cai were chosen by unanimous vote as Associate and At-large Board Member, respectively.  Dr. John Garver, Dr. Baogang Guo and Dr. Penelope Prime will serve as the other board members in their capacities as secretary, newsletter editor and director, respectively.

• Dr. Baogang Guo has received McBrayer Award for the Best Paper Presented to the 2003 Georgia Political Science Annual Meeting. The Award will be given during the Annual Meeting of the Georgia Political Science Association to be held in Nov. 11-13, 2004 in Savannah.

The China Research Center (http://www.chinacenter.net ) links China experts to the larger community interested in developments in greater China in business, media, academia and government.  The Center promotes original research on greater China’s contemporary political, economic and cultural situation.  The Center also strives to disseminate research results, policy options, and business and study opportunities for China, Taiwan and Hong Kong. The Center serves as a bridge between the Southeast United States and greater China, and a base for collaboration between academia, business and government. Please send all correspondences to Dr. Penelope B. Prime, China Research Center, c/o Department of Economics and Finance, Coles College of Business Kennesaw State University, 1000 Chastain Road # 0403, Kennesaw, Georgia 30144, Tel: (770) 423-6579    Fax: (770) 499-3209; Newsletter Editor:   Dr.  Baogang Guo,  Dalton State College.