Authorities are hoping to curb the frenzied pursuit of gross domestic product (GDP) growth by local governments by assigning individual counties either economic development or environment protection duties.
According to a notice published by the National Development and Reform Commission on Tuesday, most of the counties in the country will be classified as one of four types of functional areas in a bid to tackle unbalanced development and worsening environment problems.
The sustainability of the local environment, density of economic activity and development potential will be the three major criteria used in determining the categories.
According to the notice, economic activities will be mainly confined to zones designated as optimal or key development areas. Zones with fragile natural resources will be designated for limited or zero development.
The latter two zones will be eligible for fiscal transfers and ecological compensation funds to help ensure an equal standard of living and public services, said the notice.
In addition, GDP growth will not be used as a criterion to judge the latter two zones.
The plan, to be mapped out next year, is expected to help bridge gaps in public services and allow for balanced development. It will also help halt the deterioration of the environment, said the notice.
The notice also says cities with similar backgrounds might be categorized into a single development zone even if they are from neighboring provinces, which breaks the existing administrative framework of provinces and municipalities.
Development and performance evaluation policies will be applied directly to the zones, helping to strengthen the macro-management capacity of the central government, said the notice.
Experts said the move would help clear away development bottlenecks.
"Given the environmental and resource constraints on the country's development efforts, the plan will ensure a more reasonable flow of population and market factors among regions," Zhang Keyun, an expert who participated in developing the plan, said.
Many parts of China face water shortages, while the quality of water has been deteriorating in many others. Meanwhile, the amount of arable land is approaching the warning line.
Chen Xiuyun, dean of the Regional Economy Research Institute under Renmin University of China, said the government should set up complementary policies and supervisory organs to ensure the plan is implemented. These measures should include population and fiscal transfer policies.
"After all, it's an instructive plan and not legally binding. Better coordination between the central and local governments should be a key factor in getting it implemented," said Chen.
(China Daily August 3, 2007)