Guangdong and its neighbouring provinces are planning a Pan-Pearl River Delta economic zone, which experts say will enable these areas to derive greater benefits from the mainland-Hong Kong Closer Economic Partnership Arrangement (CEPA).

The region would include Guangdong, Hunan, Fujian, Jiangxi, Hainan, Sichuan, Yunnan and Guizhou, and Guangxi Zhuang Autonomous Region.

Last weekend, the directors of economic planning departments of these provinces gathered in Guangzhou to urge support for their proposal with the co-operation of Hong Kong and Macao.

At the meeting, now being seen as the first step towards the creation of a wider economic area, the participants agreed that a co-operation mechanism should be established, and pledged to share resources, according to a report from Xinhua News Agency.

The gathering came in the wake of the sixth meeting of Hong Kong-Guangdong Co-operation Joint Conference on August 5, at which it was resolved to transform the Greater Pearl River Delta (PRD) area into the most vibrant and competitive economic zone in the world within the CEPA framework.

Sources said the economic officials of these provinces would convene every year.

A forum on regional economic co-operation is expected to be held later this year or next.

Zhong Yangsheng, vice-governor of Guangdong, said CEPA created economic opportunities for Guangdong and its neighbours.

He believes that there are great prospects for co-operation in the region, which is home to 446 million people, and with a land area of 1.99 million square kilometres.

Experts say the Pan-Pearl River Delta plan comes at a time when Guangdong's neighbouring provinces are looking for a regional dragon head to lead an economic take-off, while Guangdong and Hong Kong are looking north to the vast domestic market.

In the past, the export-oriented Guangdong economy overlooked the potential of the domestic market.

In reality, Guangdong complements the neighbouring provinces and autonomous region.

Guangdong has advantages in terms of capital, information technology and a huge market, while the neighbouring areas are rich in natural and human resources.

Guangdong is now shifting its attention to the hinterlands, seeking co-operation with neighbouring provinces in transport, energy and tourism.

Statistics show that since 1995, Guangdong has signed more than 8,000 economic and technological co-operation projects with neighbouring provinces, and autonomous region. The contracts are valued at 550 billion yuan (US$66 billion).

However, co-operation on this scale is being seen as inadequate.

Yang Kaizhong, a professor with Peking University, urged Guangdong to follow a "go north" strategy in its future development.

He said even the Yangtze River region, especially Hunan Province and part of Hubei Province, should be the hinterland of the PRD.

Chen Zuhuang, with the policy research office of the Guangdong Party committee, said the concept of a Greater Pearl River Delta was not sufficient to ensure long-term development of Guangdong and Hong Kong.

He proposed extending the Greater PRD into a Southern China Economic Co-operation Zone by amalgamating neighbouring areas.

Such a zone should be developed into the core area of the China-ASEAN (Association of Southeast Asian Nations) free trade zone, he said.

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