VZCZCXRO4468
RR RUEHCN RUEHVC
DE RUEHGH #0293/01 1830335
ZNR UUUUU ZZH
R 020335Z JUL 09
FM AMCONSUL SHANGHAI
TO RUEHC/SECSTATE WASHDC 8100
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RULSDMK/DEPT OF TRANSPORTATION WASHINGTON DC
RUEHGH/AMCONSUL SHANGHAI 8747

UNCLAS SECTION 01 OF 03 SHANGHAI 000293 
 
SIPDIS 
 
STATE ALSO FOR EAP/CM, INR/EAP, EEB/TRA, INR/B 
STATE PASS USTR FOR CHNA OFFICE - WINTER, WINELAND 
TRANSPORTATION ALSO FOR DAS JOEL SZABAT 
TRANSPORTATION ALSO FOR X1, X40 
TRANSPORTATION ALSO FOR OFFICE OF INTERNATIONAL AVIATION 
USDOC FOR ITA DAS KASOFF, MCA/OCEA - SZYMANSKI 
 
E.O. 12958: N/A 
TAGS: ECON EWWT ELTN EAIR EIND PGOV CH
SUBJECT: LIANYUNGANG OFFICIALS ELABORATE ON JIANGSU COASTAL 
DEVELOPMENT PLAN 
 
SHANGHAI 00000293  001.2 OF 003 
 
 
¶1.  (U)  Summary.  Party and municipal government officials from 
the Jiangsu Province port city of Lianyungang extolled the 
city's investment prospects and development plans under the 
State Council-approved Jiangsu Coastal Region Development Plan 
at a July 1 seminar in Shanghai.  New materials, new energy and 
new pharmaceuticals are preferred directions of industrial 
development, while the city's rail and highway links will be 
expanded, as will the port's harbor and shipyard capacities. 
End summary. 
 
 
 
¶2.  (U)  Pol/Econ Chief and summer intern and Economic Assistant 
(notetakers) attended the Promotion Fair for Cooperation on the 
Coastal Development of Lianyungang, hosted by Lianyungang Party 
Secretary Wang Jianhua and Mayor Xu Yiping on July 1 at the 
Shanghai International Conventional Center.  Approximately 500 
persons attended the morning speeches and ensuing noontime 
banquet (bai jiu optional; traditional Chinese music performed 
by a troupe of entertainers from Lianyungang), including Jiangsu 
Province Vice Governor Zhang Weiguo; diplomats from Russia, 
Japan, Spain, the Netherlands, South Korea, and Singapore; 
numerous businesspersons from Jiangsu, Shanghai, elsewhere in 
the Mainland, Hong Kong, Japan and Taiwan; and a large media 
contingent which was not offered opportunity to raise questions 
during the formal 90-minute morning briefing session.  (Party 
Secretary Wang had conducted at least one press interview 
earlier in the week, however.)  Vice Mayor Shi Yan, Municipal 
Foreign Affairs Office Director General Li Ya, Municipal Party 
Publicity Director and Party Committee Secretary-General Zhang 
Guangdong, and multiple city district Party Secretaries were 
among the large Lianyungang delegation.  The Shanghai event was 
convened three weeks after the State Council in Beijing approved 
the Jiangsu Coastal Region Development Plan on June 10, which 
upgraded Lianyungang's economic development status to the 
national strategic level. 
 
 
 
Jiangsu Coastal Region Development Plan 
 
 
 
¶3.  (U)  Under the Jiangsu Coastal Region Development Plan, 
Jiangsu Province (population 76 million; 2008 GDP $440 billion) 
is to serve as a major economic growth engine in East China. 
The development plan has eight major points: 
 
 
 
-Accelerate the development of Lianyungang, Yancheng and 
Nantong, building the coastal economy while increasing 
urbanization.  (Note:  The populations of these three 
administrative areas within Jiangsu Province are 4.8 million, 
8.1 million and 7.7 million, respectively.  All are located to 
in that portion of Jiangsu Province north of the Yangtze River 
(Su Bei), that is, in that portion of Jiangsu considerably less 
well-off than Suzhou, Wuxi, Changzhou, Kunshan, provincial 
capital Nanjing and the rest of Jiangsu south of the Yangtze 
River (Su Nan).  End note.) 
 
 
 
-Develop and improve ports, transportation, waterways, power 
grids, and other local infrastructure. 
 
 
 
-Modernize the agriculture sector and build an agriculture 
production base. 
 
 
 
-Promote the development of advanced manufacturing and service 
industries; develop production of alternative energy 
technologies such as wind-power. 
 
 
 
-Accelerate urbanization in order to narrow the disparity 
between the northern and southern parts of Jiangsu. 
 
 
 
SHANGHAI 00000293  002.2 OF 003 
 
 
 
-Promote development of ocean resources. 
 
 
 
-Enforce strict compliance of regulations for the protection of 
environment. 
 
 
 
-Continue to build human resources to further develop Jiangsu. 
 
 
 
Party Secretary Wang:  Lianyungang's Seven Advantages 
 
 
 
¶4.  (U)  With Mayor Xu service as master of ceremonies for the 
July 1 briefing, Lianyungang Party Secretary Wang Jianhua 
provided the lengthiest and most substantive presentation about 
the coastal development plan and Lianyungang's role as a 
locomotive for economic development in Su Bei and for those 
inland provinces, all the way out to Xinjiang, linked to the 
Port of Lianyungang by rail.  Briefly noting that Lianyungang 
had achieved its 13 percent GDP growth target in 2009 Q1, Wang 
said Lianyungang has seven key advantages that make strong 
economic growth possible: 
 
 
 
-First, Lianyungang has received solid support from the Central 
Government, as shown by State Council passage of the Jiangsu 
Coastal Region Development Plan.  This plan has specified 
Lianyungang to become the leading coastal city in Jiangsu 
Province. 
 
 
 
-Second, Lianyungang boasts a precious coastline suitable for a 
major port.  Lianyungang's administrative district (the city 
itself and several adjoining counties) has a 205-kilometer coast 
line, including 44 kilometers of deepwater coastline.  These 
precious resources give Lianyungang the capability to build 
numerous berths capable of handling ships from 50,000 to 300,000 
tons.  Since 2005, investments in upgrading infrastructure and 
deepening harbor channels at the Port of Lianyungang has 
amounted to RMB 15 billion - more than $2 billion.  By 2012, the 
Port of Lianyungang will attain an annual throughput capacity of 
120 million tons and 4 million TEU.  (Note:  Wang's accompanying 
slide presentation showed plans to develop a second port and 
heavy industry zone on landfill planned for south of the current 
Port of Lianyungang.  End note.) 
 
 
 
-Third, Lianyungang was among the first 14 cities opened to 
foreign investment in 1984 and is one of the three business 
centers of Jiangsu Province.  Since it opened to foreign 
investment in 1984, Lianyungang has received accumulated foreign 
investment amounting to $6 billion.  Many global enterprises 
have established operations in Lianyungang, with the Party 
Secretary citing DuPont and Mitsubishi as examples. 
 
 
 
-Fourth, Lianyungang has 300 square kilometers of salt land 
nears its port that can be converted into industrial zones 
easily, and provides space to develop new energy, new materials 
and new pharmaceutical industries.   Lianyungang has also formed 
all the necessary ancillary services to develop new energy, 
materials and pharmaceutical industries, Wang asserted. 
 
 
 
-Fifth, there are low operating costs for industries in 
Lianyungang.  The average monthly salary for middle management 
and technical workers is between RMB2000-2500, while the average 
monthly salary for workers is between RMB800-1000.  The average 
housing purchase price in the urban area is only RMB 3500/square 
meter. 
 
 
 
SHANGHAI 00000293  003.2 OF 003 
 
 
 
-Sixth, Lianyungang's transportation conveniently connects it to 
the world.  Lianyungang has opened more than 50 container lines 
that can reach most major ports in the world.  It also plans to 
upgrade the international airport to open more domestic and 
international lines.  The Ministry of Railways has approved the 
construction of the Qingdao-Shanghai railway, and upon 
completion it will take only two hours by train to reach Qingdao 
(a major port to the north in Shandong Province) and Shanghai 
from Lianyungang. 
 
 
 
-Seventh, Lianyungang offers beautiful mountains and seashores 
to attract tourism.  In the Yangtze Delta Region, Lianyungang is 
the closest destination for wide sand ocean beaches, along with 
boasting four AAAA sightseeing areas, the highest designation 
conferred by China's National Tourism Administration. 
 
 
 
Key Future Industries for the New Lianyungang 
 
 
 
¶5.  (U)  Party Secretary Wang's speech offered several details 
about the planned development of new materials, new energy and 
new pharmaceuticals industries for Lianyungang's future (see 
also ref A).  For new materials, Lianyungang plans to develop 
carbon fiber, polysilicon (for solar power), photoelectronic 
materials and fuel cell materials.  In the new energy area, 
Lianyungang aims to increase production of wind-power equipment, 
solar heating utilization technology and to develop the solar PV 
industry and other clean energy equipment industries.  (Note:  A 
Hong Kong businessman at the July 1 event told us his company 
has recently shipped 300,000 tons of steam coal from the United 
States (principally from the Powder River Basin and from Alaska) 
to Chinese customers and that power plant operators in 
Lianyungang have expressed interest in using U.S. coal to mix 
with domestic coal as a means of reducing overall sulfur 
emissions.  Lianyungang has thermal power plants and an IGCC 
facility planned there under the auspices of the Chinese Academy 
of Sciences, but most often touts its Russian-built nuclear 
power plant for providing reliable, adequate and reasonably 
priced electricity to businesses there.  End note.)  In new 
pharmaceuticals, Lianyungang plans to develop chemosynthesis 
medicine, modern production of traditional Chinese medicines and 
marine biomedicine. 
CAMP