To what extent are geographical factors responsible for the aggravated

developmental disparity in China since 2001?

Ever since China successfully joined WTO in 2001, income disparity between the
rural and coastal regions has worsened. Since then, China has experienced much
economic growth. From then till 2008, when China hosted the Beijing Olympics,
the situation did not turn out for the better. Year 2008 is significant as migrant
workers were asked to return to their village during the Games, despite them
contributing to the success of the Games. To a large extent, geographical factors
are the fundamental causes for the development disparity in China. Is must be
noted that governmental strategy at promoting economic growth before 2001is
already formulated unevenly along the varying geographical areas. Such has
favored the better endowed coastal cities over the interior provinces. The priority
then was to stimulate maximal growth at the lowest costs with the greatest
convenience. Meanwhile, the accession into WTO worsened the disparity as
sharp rise in economic activities after which is largely predicated upon the
discriminatory development policy.
For reasons of convenience, the better endowed coastal regions and prioritized
over the relatively more inaccessible inland areas in Dengs economic reforms,
thereby worsening regional disparity. The metropolises of Beijing, Tianjin and
Shanghai are the richest pockets of China and they experience high growth.
These cities are highly industrialized and over 71% of their population lived
within 100km of the coast. The coastal provinces such as Hebei, Shandong,
Jiangsu, Zhejiang, Fujian, Guangdong and Hainan have 82% of their population
living within 100km of the sea. They had grown the fastest in the 1978-1998
periods at an annual average of 10.7% Zhejiang and Guangdong are the
archetype of the nouveau riche provinces. The low cost of water transportation
makes the coastal provinces and areas along navigable rivers that flow to the
sea better suited to be platforms for producing manufactured exports. When
allowed by the government, domestic firms located in these regions would
naturally expand production to service foreign markets. Foreign firms would
relocate their production there too. Hence, provinces with easy access to sea
transportation receive boosts to their incomes from international trade.
Based on geographical endowment, governmental policies are implemented,
resulting in the better-endowed regions getting richer and the less well-endowed
regions been neglected. Since the southwestern provinces lack the mineral
resources the northwestern provinces have, the southwestern provinces had the
lowest GDP per capita in 1978 and have had the western growth rates in the
period of market-oriented reform. The 2 large rivers endow many of the central
provinces with easy water transportation. Though the western region is rich in
natural resources like petroleum, it remains untapped because of Chinas high
transportation cost and shortage of capita and technology.
Geographical factors are more important in the aggravation of developmental
disparity because it had a huge influence over governmental policies. The
temperature and rainfall make the central provinces such as Shanxi, Henan,
Anhui, Hubei, Hunan and Jiangxi the agricultural heartland of China, which
explains why its population density is almost twice that of the northeastern and
Southwestern provinces. The northwestern provinces such as Inner Mongolia,
Shaanxi, Ningxia, Gansu, Qinghai, Xinjiang and Tibet as compared, are isolated,
arid and geographically steeper, marked by desert on its western and northern
borders. Lack of water makes agriculture in the region difficult, and only 8% of

the land is arable. The southwestern provinces of Sichuan, Yunnan, Guizhou have
rainfall and temperature conditions that are ideal for crop cultivation but they are
unfortunately mountainous. Generally, the western suffers from a poor natural
environment, poor production and limited agricultural development and
backward transportation system. Its landlocked location in the inner continent
affects its international economic contact.
However, a part of income disparity is also worsened by Chinas attempt to fulfill
the criteria to enter the WTO, not geographical factors. Over the past 20years,
the central government has decentralized by granting considerable
administrative and economic powers to the provincial and sub provincial
governments. While they possess the authority, local government often lacks
sufficient resources and incentives to carry out the necessary structural reforms
and policies that could help the agricultural sector. The increased fiscal burden
on local governments, particularly in poor inland regions, hinders sustainable
production and conservation. In November 2001, at the same WTO ministerial
meeting where China was formally accepted as a member, the WTO put new
emphases on the environment and development programs in the organizations
agenda. As tariff in primary commodities such as timber and minerals is reduced,
it is clear that domestic policy choices in the changing international
environmental may more directly and more profoundly worsen the livelihood of
Chinas rural population in the coming decades than the fulfilling of the WTO
agricultural agreements, hence worsening income disparity.
Moreover, a governmental effort put in place to promote equity is also sabotaged
by the difficulty in overcoming the typography of the west and not geographical
factors. Despite the Go West policy of China, the gap between the western
region and the eastern region of China has not decreased. Despite the significant
improvements in infrastructure and production conditions in poor areas, the pace
of poverty has slowed significantly since the late 1990s. Rather than
geographical reasons, it is mostly due to adult illiteracy, malnutrition, short life
expectancy and poor health conditions of mothers. In spite of geographical
constraints, it is possible to narrow the income gaps with sufficient scientific
investment to hasten the diffusion of new technologies from the coastal
provinces and foreign countries to western China.
Investments and businesses are attracted to go to the already rich coastal
regions and not the poorer inland regions because of the established position of
the coastal regions and not the geographical factors. The inflow of MNCs had
caused the economic development of China to be more uneven. The MNCs are
more willing to set up branches and factories in the coastal regions as these
regions are more accessible and have better resources. The infrastructures in the
coastal regions are also better than the inland region, thus starting a business
there would be more beneficial. Hardly any MNCs are willing to invest in inland
China as they do not wish to be the ox to lough the barren inland China.
Furthermore, if they succeed in opening up inland Chinas economy, competitors
will flock in thus their hard work will not be all theirs as others stand to benefit
from it too. This trend of more FDI reaching the coastal regions had caused
thereto be a severe regional income disparity in China with a person working at
coastal region earning an average of $3000 per month while a person working in
the inland only $1000 in 2004.
In conclusion, entry into the WTO has further aggravated the developmental
disparity in China. However, geographical factors do play a major role in causing

the disparity. Geographical factors of China interplayed with other factors

resulting in the aggravation of the developmental disparity. Therefore, to a large
extent, geographical factors are responsible for the aggravated developmental
disparity, though they alone are not enough to widen it. Geography and other
factors interplay and work together to worsen the situation. Accession into WTO
only made matters worse as the eastern coastal provinces are becoming more
developed and the western inland regions are being neglected.