Three years on, China's northeast regains its shine

No breaking, no making

In 2018, annual steel output of the Dalian-based Dongbei Special Steel Group Co Ltd exceeded 2.3 million metric tons, a 72.9 percent increase compared with a year earlier.

The historical breakthrough in yield was also accompanied by a return to profitability, which happened just three years after the 114-year-old State-owned steelmaker collapsed and entered a bankruptcy restructuring process in 2016.

"I'm just making this company look like a real company," said Gong Sheng, who was appointed as chairman of the Dongbei Special Steel by Shagang Group, the largest private steel enterprise in China and the largest shareholder of the once-bankrupted behemoth that turned to mixed ownership.

The lack of efficiency and incentives for innovation in the northeast is largely because of the high proportion of State-owned enterprises in the region, said Chang Xiuze, a professor with the think tank of National Development and Reform Commission, the country's top economic planner.

Chang suggested that the only feasible solutions lie in reform of State-owned enterprises and the supply-side structural reform.

In Changchun, capital of Jilin, China's leading automaker FAW Group has made a dent in a series of "surgical reforms" related to its personnel system and brand reconstruction.

The old system, under which there was no difference between more or less work and good or bad results, has been abolished. Those who were incapable or could not do a good job were removed from leadership.

Competition brought a sense of crisis, thus a significant improvement of efficiency in management and operation. The company's revenues hit 593.7 billion yuan in 2018, up 26.4 percent annually.

Based on advantages in talent and R&D, the northeast industrial heartland is also accelerating its pace to incubate high-tech startups.

Founded in 2015, Liaoning Dralong Technology became an eye-catching exhibitor at the 2018 Hannover Messe with its fuel-powered drones. Sales expanded 40 times from 2016 to 40 million yuan last year and are expected to exceed 100 million yuan in 2019.

Dralong's core technology is the precise control of petro-fuelled UAVs, which have much longer flight duration and a larger load compared with electric ones, said Zhang Li, general manager of Dralong.

In Jilin, the number of high-tech enterprises soared 69.8 percent last year. A more diverse and innovative industrial structure has taken shape.