China National Petroleum Corporation

Western areas call for levies on use of resources

PUBLISHED : Thursday, 08 March, 2007, 12:00am
UPDATED : Thursday, 08 March, 2007, 12:00am

Officials from inland provinces have lashed out at rich coastal regions for grabbing resources without adequate compensation.

Delegates to the National People's Congress urged Beijing to let the western provinces levy duties on natural resources development, saying it would help expand their economies.

Speaking at a group discussion attended by Public Security Minister Zhou Yongkang , Sichuan delegates voiced grievances over the resources drain.

'We need to make use of our natural resources and turn them into real wealth for local people,' said Sichuan vice-governor Gan Daoming, whose province is rich in natural gas, minerals and hydroelectric power.

'If we hand over all the revenue [generated from resources development] to companies from outside, Sichuan people cannot get any real benefits.'

He cited the example of China National Petroleum Corp (CNPC), which has extensive natural gas developments in Sichuan.

'We have rich natural gas resources, but in the end, 80 per cent of natural gas goes to the eastern provinces. Only 20 per cent is left for us. And we have to pay for the pipes and other fees,' he said.

Companies such as CNPC pay taxes to the central government.

Another delegate, Wang Xinqiong from Sichuan's poverty-stricken Bazhong county, said the practice was like 'asking starving people to donate blood'.

'We hope the central government can allow us to levy taxes on corporations which come to Sichuan to develop our resources,' she said. 'They come and get our resources, leaving us polluted land and rivers to take care of.'

Delegates from Shaanxi made the same request.

'Shaanxi has rich natural resources, but because of the south-north water diversion project, we can't fully develop these resources. We should be compensated,' said Li Xiaodong , director of the Shaanxi Development and Reform Committee.

The wealth gap between the developed east and backwater west is a troubling problem, creating tensions about uneven development.

While Beijing has launched an ambitious plan to accelerate development in the west, the result has been mixed.

Sichuan has reported faster growth than in the previous decade, but its share of foreign investment is still tiny.