INTRODUCTION

Located at the heart of Northeast Asia and along the coast of the West Pacific, the Bohai Rim comprises two municipalities and three provinces (Beijing, Tianjin, Hebei, Liaoning and Shandong). It covers 5.43 per cent of China's total area, and houses a population of 231.34 million, which accounts for 17.60 per cent of China's total population. In 2006, the Bohai Rim contributed 26.19 per cent of China's gross domestic product (GDP), 26.62 per cent of China's total profit and 21.85 per cent of China's total imports and exports. The Bohai Rim, together with Pearl River Delta (PRD) and Yangtze River Delta (YRD), forms China's three biggest industrial belts.

Benefiting from the ‘eastward moving’ trend of investments in the world and the ‘northward moving’ trend of development in China, the Bohai Rim has drawn the attention of the world in recent years. After the Binhai New Area of Tianjin was officially designated the experimental zone for comprehensive reform, Tianjin was defined by the State Council as the economic centre of North China and Beijing was delineated as “China's capital, metropolis, culturally well-known city and suitable city for residence”. These have brought new opportunities for economic cooperation in the area. The Bohai Rim is expected to become the third economic growth engine for China.

The Bohai Rim's regional economic development has great potential. But regional economic cooperation in the area is more like a “proposal”, far behind the regional economic integration process in the YRD and the PRD, although the concept of the ‘Bohai Rim Economic Circle’ was first suggested in the mid 1980s. 7 The lack of cooperation increased the development cost of the region and the traditional economic growth pattern has brought environmental crisis which is increasing severe restrictions on the economic development of the region.

THE OVERVIEW OF THE BOHAI RIM'S ECONOMIC DEVELOPMENT

The Bohai Rim is an important base for both basic and high-tech industries in China. Its share of China's GDP has remained above 20 per cent since the 1950s (see Figure 9.1).