Positive Environment News

FEATURE - Dying China Oil Town A Warning To Beijing

Date: 18-Apr-08
Country: CHINA
Author: Emma Graham-Harrison

And though it is home to just a few thousand people, in a nation of over 1.3 billion, Beijing's stability obsessed bureaucrats are fretting about their fate.

They worry because Yumen's poor, disgruntled inhabitants are the thin end of a wedge of discontent that could engulf hundreds of thousands of people within a decade unless the central government can tackle one of the more obscure but troubling legacies of past socialist policies.

The potential troublemakers live in dozens of "resource towns" scattered across China, which were built by Mao-era economic planners to exploit energy or mineral deposits regardless of how remote or inhospitable the location.

Now some seams of oil, coal and ores are starting to run out, pushing up unemployment and migration while leaving behind shells of towns that are impoverished tinderboxes of unrest.

Yumen is one of many resource towns that should probably never have existed, clinging to mountains in a high-altitude corner of poor northwestern Gansu province, with a single oilfield as its gushing but fragile economic base.

"It's a general problem, Yumen is just an example," said Phillips Andrews-Speed, Professor of Energy Policy at Dundee University. He has studied how China's desperate hunt for energy has marginalised some of the people who produce it.

"You have groups of thousands or tens of thousands of people left in the middle of nowhere who will be poor and with nothing to do...it is a growing problem for the government," he added.

Built to service what was then a key oilfield, Yumen was populated by a fortunate elite with coveted state jobs.

But oil output peaked in 1959 and by the start of this century had become so insignificant compared to other finds that PetroChina moved its headquarters out of town.

When local officials followed suit, setting up a "new Yumen" in a more convenient location, it was a fatal blow to the town they were meant to nurture. Today just 2,000 yuan ($280) can buy a flat along the main street, pockmarked with boarded-up shops.

Food is expensive because it is mostly trucked in with too few buyers to push prices down, and there are no hopes of new employment for the men and women who used to pump oil.

"I can't eat well, I can't buy clothes, I can't even think of travelling or having fun. All I can do is try to slowly pass my days," said a laid-off worker who gave only his surname, Quan.

"We have all been out to protest."


Resource towns everywhere shrivel up or suffer when their key source of income fades. Texas is dotted with ghost towns and industrial centres of northern England struggled for decades after coal and heavy industry slipped into decline.

But the future for remote Yumen, one of the first in China to face resource depletion, seems particularly grim.

In Maoist China there was little diversification and planners preferred to create whole settlements near mines and pumps rather than ship workers to sites far from their families.

The people who built the single-purpose cities relied entirely on a state that promised to provide cradle to grave support, making few plans or provisions for a bleaker future.

Now, the central government's energy bureaucrats have moved out of micro-management, abandoning Yumen to local officials who never took steps to plan for a future without oil.

"When the old economy is gone you need to build a new one, but it takes at least a decade. So if you don't start until after the old one is finished you are stuck," said Andrews-Speed.

"The planned economy didn't anticipate this."

With stability a top concern as the gap between rich and poor widens, Beijing knows it has a serious problem on its hands -- its finance minister mentioned revamping resource towns at the annual session of parliament earlier this month.

"China has identified 118 cities that have developed around the mining of natural

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