Finance.ifeng.com recently had a dialogue with Professor Yu Miaojie, deputy to the National People’s Congress, member of the Standing Committee of the Liaoning Provincial People’s Congress, also deputy secretary of the Party Committee and president of Liaoning University, over the issues such as population, real estate, and economy of Northeast China.
The former three northeastern provinces, well-known for the fertile land, developed agriculture, and abundant mineral resources, were the most important industrial bases in China. However, since the late 1990s, the Northeast region has experienced economic downturn and population outflow.
What happened to the economy of the Northeast? How to break the situation? Why is there a saying that “Investments do not go beyond the Shanhaiguan Pass” ? How will China’s economy develop in the post-epidemic era? On February 4th, the First Changbai Mountain Summit Forum in 2023 jointly initiated by Finance.ifeng.com and Northeast Securities will be officially held. Themed with Looking forward to Promising Future of 2023 in the post-epidemic era, the Forum will have an in-depth interpretations around topics such as policy, investment, and real estate.
On the eve of the Forum, Finance.ifeng.com has a dialogue with Professor Yu Miaojie, and conducts an in-depth discussion on issues such as population, real estate, and economy in Northeast China.
When talking about his views on the saying “Investments do not go beyond the Shanhaiguan Pass”, Yu Miaojie said that the harm caused by this saying to the entire Northeast economy is immeasurable. For example, as an ordinary person, should I invest in the Northeast? Who would dare to go because of this saying? So this is the biggest problem.
Yu Miaojie pointed out that the reason for this problem is that things were done without integrity in some places, and then excessively high transaction cost was formed, which had a great impact on the local economy. Especially the common people here were gradually losing confidence, which is even worse. Confidence is more important than gold.
Professor Yu believes that the most simple and fundamental reason why enterprises dare not cross Shanhaiguan Pass to invest here is that the cost is too high. The labor force here is cheaper than many provinces along the eastern coast, the natural resources are abundant, and it is close to the raw material site. The cost should be lower, but why is the cost high? Because market transaction cost here is excessively high, and these enterprises may feel that the business efficiency is overly low, so they want to take a detour.
“In fact, from a certain point of view, the aforementioned problem makes the originally bad ecology exist for a long time. From the perspective of ordinary people, if they have business, they can directly go to government agencies to get it done; from the government side, agencies should effectively perform administrative functions if business does not violate relevant policies. This can be possibly achieved and many provinces in the South have already done in this way, so I think it is very important to effectively reduce transaction costs.” Professor Yu noted.