Development zone boom 'excessive'

A SENIOR state planner yesterday said the phenomenon of localities feverishly starting new development zones had become ''excessive'' and that it would lead to adverse effects on the economy.

Mr Gao Shangquan, a vice-chairman of the State Planning Commission, said the unhealthy development was a result of local authorities trying to introduce their own development zones.

''Local governments and departments would all like to see development zones developed and increased rapidly,'' he said.

''Not just the provinces are doing that now. Many counties and villages are trying to allocate areas for development zones.'' He said that this was ''excessive''.

Noting that it was normal for the economy to ''heat up'' in the process of the intensification of reforms, Mr Gao warned that the problems of an ''overheating economy'' should be closely monitored.

In addition to development zones, he said the property and stock markets also had shown signs of overheating.

The official called on the localities to abide by the rule of market mechanism in promoting development zones, stock markets and property markets.

''Commercial decisions on plans such as the opening of development zones should not be based on the will of a person. They have to take into account the needs, the availability of projects and the market,'' said Mr Gao.

''They should strive for the target of maximising profits with the minimal amount of investments.'' Officials have warned that the ''blind'' opening of development zones could further strain the tight money market, burdening the Treasury and triggering inflation.

Mr Gao also addressed the issue of the widening gap between the rich and poor provinces, saying the Government had taken measures to help bridge the gap.

Under the strategy of ''all-directional opening up'', Mr Gao said five cities along the Yangtze River and 13 border cities had been designated as open cities.

Another 18 provinces and cities had been given greater powers to handle foreign investments.

This would facilitate the economic growth of the under-developed regions, said Mr Gao.

The planning department would promote the exchange of personnel between coastal provinces and those in the hinterland.

''This is also a way of training up officials,'' Mr Gao said.