Dalian Mayor Says Nuclear Equipment Industry May Boost Growth

Xia Deren, mayor of the northeastern Chinese port of Dalian, comments on the city’s efforts to alleviate a slowdown in shipbuilding demand by spending to build infrastructure and develop new industries.

Dalian is home to one of China’s biggest shipyards, operated by China Shipbuilding Industry Corp., the country’s second-biggest builder of vessels. Xia spoke in Mandarin in an interview yesterday in the city government’s headquarters.

On new industries:

“Industries such as nuclear- and wind-power equipment will soon experience large-scale expansion to offset slowing growth.

“Rolling stock demand from the central government railway investment will also be good, and growth in these industries will help to offset declines in the shipbuilding industry after 2012.

“This period is key. From now until 2012, we need to adjust the structure of the shipbuilding industry; developing high value-added products such as marine engineering equipment, drilling platforms and high value-added vessels.”

On economic growth in Dalian:

“Last year, Dalian’s gross domestic product expanded 16.5 percent. In the first quarter of this year, GDP grew 11.1 percent, markedly slower than the same period a year earlier, but we’re planning for the city to expand 14 percent this year.

“Over the next few quarters, as the country implements measures to boost domestic consumption, we’re confident we can achieve the 14 percent target.”

On stimulus investment in Dalian:

“There are already 38 projects that are receiving about 1 billion yuan ($143 million) of subsidies directly from the central government. Dalian will match this central investment at a rate of at least 1 to 1.

“Dalian has plans for more than 1,400 stimulus projects including industrial and infrastructure, requiring 1.18 trillion yuan of total investment. We plan to make about one third of that investment, 330 billion yuan, this year, about a 30 percent increase from last year.”

On the effects of falling exports:

“The main effect of the financial crisis on Dalian has been exports, which have slowed since November. More than 100 exporters have reduced or stopped production, leading to 8,000 layoffs in the first quarter.

“Our unemployment-rate target this year is 3.5 percent, compared with 2.5 percent last year. We have more than 1.6 million workers in the city, and the rate right now is about 3 percent.”

To contact the reporter on this story: Lee Spears in Beijing at lspears2@bloomberg.net.

To contact the editor responsible for this story: Teo Chian Wei at cwteo@bloomberg.net.

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