China's economic gap seen diminishing: NDRC

The economic gap between China's eastern and western regions has been diminishing in the past six years, with western regions showing the most growth potential across the nation, China's top economic planner said Monday.

Major economic indicators for western regions have outperformed those of eastern regions and the national average level since 2007, the National Development and Reform Commission (NDRC) said in a statement on its website.

The combined GDP of western regions amounted to 11.4 trillion yuan ($1.86 trillion) in 2012, up 12.5 percent from a year earlier and higher than the national GDP growth of 7.8 percent during the same period, according to the NDRC.

The total GDP in western regions accounted for 19.8 percent of the country's GDP last year, up from 19.2 percent in 2011, the NDRC said.

"Compared with eastern regions, western regions have been less affected by the global economic downturn given their lower dependence on exports," Zhang Baotong, a research fellow with the Shaanxi Academy of Social Sciences, told the Global Times Monday.

China will continue to push forward with its western development strategy, the NDRC said.

According to the statement, work that needs to be implemented this year includes speeding up infrastructure construction, deepening the reform of prices for resource products, encouraging foreign enterprises to increase investment in western regions, and rolling out more opening-up policies for western regions.

During a three-day visit to Northwest China's Gansu Province last week, Premier Li Keqiang also demonstrated his confidence in western regions' growth potential, and pledged preferential policies for the regions that will feature huge spending on infrastructure.

"Transportation infrastructure construction in western regions, including railways, airports and highways, is important for transferring industry from the country's eastern regions to western regions," Bai Pengming, an analyst at Shenzhen-based CIC Industry Research Center, told the Global Times Monday.

"The message delivered by the central authorities is that investment will still be the growth engine of western regions," Zhang said.

Investment is an efficient way to drive up economic growth in underdeveloped regions and tackle uneven regional development, Zhang noted.

In the first half of this year, eight of the 10 regions with the highest growth rate of fixed-assets investment were in western China, according to data compiled by the China News Service last week.

"Maintaining growth is a prerequisite for promoting reforms," Bai said. "In this case, the investment in fixed assets will still be robust in western regions, but central authorities will strengthen risk controls for the investment."

However, a report released by the Xi'an-based Northwest University on July 21 said the rate of return on investment in western regions is not high.