Eco Service Management, a unit of blue chip Hong Kong and China Gas (Towngas), recently announced it was setting up its regional headquarters in a hi-tech zone on the outskirts of Xian.

Meanwhile, Foxconn International has set up operations in the inland Wuhan city and Shanxi province while Motorola established a research and development laboratory in Chengdu to develop software for mobile telephones.

Alcatel-Lucent, Ericsson, Nokia and Microsoft Corp also have all set up research and development centres around Chengdu.

Much of this investment is expected to bring about a knock-on effect on the manufacturing value chain as suppliers join the move inland, benefiting local small and medium-sized manufacturers.

The shift by these companies, which has some similarities with America's westward migration in the 19th century, comes as the latest official data reveals a dramatic change in fortunes for regional economies.

While some economists remain sceptical the move can become a sustainable trend, early signs show the traditional scenario that has seen inland regions lag robust growth on the coast is being reversed.

The mainland's economic growth slowed in the first quarter of this year to 6.1 per cent, a sharp decline from the 10.6 per cent gain a year earlier and representing the weakest growth since quarterly records began in 1992.

But while growth in formerly pace-setting coastal provinces lagged the national average, their poorer inland cousins in the western, central and northeast regions expanded at an above-average pace - a precedent not seen since the mainland adopted its open-door policy in 1978.

The most prominent decline on the eastern seaboard came from Dongguan, the mainland's foremost export manufacturing centre, which recorded an unparalleled negative growth of 2.5 per cent in the first quarter.

The Pearl River Delta city's performance was a key reason behind Guangdong province's lacklustre 5.5 per cent first-quarter growth, the slowest in 20 years and nearly half the 10.5 per cent recorded a year earlier.

The southern province, the largest of the 31 provinces and municipalities directly under the central government, accounts for about 28 per cent of the nation's exports and 12.5 per cent of its gross domestic product. Its historical compound annual growth rate is 14.4 per cent.

Shanghai, the mainland's biggest commercial city, registered lacklustre growth of 3.1 per cent in the first three months of the year while neighbouring Zhejiang, the richest province in per capita income terms and known for its booming private sector, grew 3.4 per cent year on year, an 8.4 percentage point decline from the first quarter of last year.

The depressing numbers send these traditional economic powerhouses to the bottom of the nationwide growth rankings - Guangdong and Zhejiang to 26th and 29th place, and Shanghai to 30th. That was just one notch above the coal-rich northwestern province of Shanxi.

By contrast, western and central regions accounted for nine of the 11 provincial areas that posted double-digit growth in the first quarter.

'There are signs that China's inland economy is 'decoupling' from the eastern coastal regions, which are more exposed to external demand,' said Jing Ulrich, managing director and chairman of JP Morgan's China equities.

Zhao Ying, an economist at the Chinese Academy of Social Sciences (CASS), a leading government think-tank, described the trend as an 'abrupt turn' that began in the middle of last year when the US financial crisis began to spread worldwide.

Over the past 30 years, coastal provinces have had a growth advantage over inland regions as surging exports and lashings of foreign investment helped the mainland become the world's third-largest economy.

But the extensive reliance on the export trade has meant the impact of the world recession has been more pronounced in port cities along the eastern seaboard. In the first four months of the year, the mainland's total trade volume plunged 24.3 per cent to US$599.4 billion. Exports were down 20.5 per cent and imports slipped 28.7 per cent.

The weak showing was more prominent in regions like Guangdong, where exports account for about 75 per cent of the province's economy, more than double the national 32.6 per cent level.

Changing growth rate trends have gone largely unnoticed in the past two years. Last year, Shaanxi and Inner Mongolia were among the fastest-growing economies with GDP increasing 15 per cent and 17.5 per cent respectively. At the same time, several coastal provinces posted single-digit growth.

Mr Zhao said several factors were behind the changing growth patterns broadly stemming from the coastal regions' focus on the external market and inland provinces' concentration on the domestic mainland market.

With global trade on a slump, the inland provinces' strong dependence on domestic markets is seen as a good bet. Rising consumer spending, a government policy of supporting development in the west and the 4 trillion yuan (HK$4.53 trillion) stimulus package have helped push growth.

Paramount leader Deng Xiaoping's declaration that 'to get rich is glorious' made coastal Guangdong the first province to achieve relative wealth, while former president Jiang Zemin and former premier Zhu Rongji's regional power base in Shanghai guaranteed central government support for development of the country's biggest commercial city.

But since they came into power in 2002, President Hu Jintao and Premier Wen Jiabao have advocated the building of a 'harmonious society' that encompassed 'the new socialist countryside'.

Their aims are to help those left behind by breakneck growth in the largely urban areas of the country by directing investment towards the west, central and northeast.

Pan Yingli, a professor at Shanghai's Jiaotong University, said structural changes had been taking place in the economy for years and the global financial crisis had only added impetus to the restructuring. Mr Pan said growth in the export-oriented manufacturing sector in the east had been in a bottleneck because of rapidly rising costs.

The increasing competitive margins of the inland regions largely explained moves by Towngas and Intel to shift away from the coast.

Li Daokui, a director of the department of finance at Tsinghua University, said stronger than expected economic growth in the inland regions had reflected the strong impetus of domestic consumption and investment.

Nationwide retail sales rose 14.8 per cent in April, with growth in the countryside climbing 16.7 per cent compared with the urban rate of 13.9 per cent. The same strength was evident in capital investment.

Urban fixed-asset investment in the west jumped 46.2 per cent to 504.2 billion yuan in the first quarter, 26.4 percentage points higher than the figure for eastern China and 18.1 percentage points above the average weighted national growth, according to the National Development and Reform Commission.

Traditional economic leader Shanghai registered the lowest growth of 1.7 per cent to 90.23 billion yuan.

Mr Zhao attributed the shift to the government delivering on its promise to invest a big chunk of the 4 trillion yuan stimulus package in infrastructure in the central and western regions.

In its Blue Book of Urban Competitiveness released in April, the CASS said while coastal cities retained their competitiveness, the inland was fast catching up.

Of the 10 fastest-growing mainland cities last year, eight were in northern agriculture-dominated Inner Mongolia and northeastern industrial Liaoning and Jilin. The remaining two were Heyuan and Qingyuan in southern Guangdong, it said.

'Decoupled from the coastal export economy, China's inland cities are becoming important centres of growth,' Mrs Ulrich said.

Mr Pan said in the medium term, it was more certain the inland regions would outpace coastal areas as they were now in their early or middle stages of industrialisation, where growth rates often outpace the coastal cities that have reached the late stages and are focusing on the development of the service industry.