Hebei province is promoting urbanization within its borders with a plan to have some national administrative agencies, institutions and industries move there from Beijing.
The official policy statement from Hebei, released on Wednesday, calls for a synchronized joint development program with Beijing and Tianjin that uses Baoding's geographical advantages to attract some agencies and businesses now in the congested national capital.
The document was released by the Hebei provincial government to solicit feedback, according to Xinhua News Agency. The plan follows President Xi Jinping's call in late February for coordinated development of the region around Beijing.
Baoding - which will create a government service area - is halfway between Beijing and Shijiazhuang, the capital of Hebei. High-speed train travel from Beijing to Baoding takes only 40 minutes.
The service area will also include industries like high-end equipment manufacturing, new energy, environmental protection and airport logistics that are now in the capital. Some of Beijing's universities, research institutions and medical and nursing services will also move to Baoding under the plan.
Baoding's local government vowed to increase efforts to improve its urban environment to attract more private businesses from the capital.
Li Yanjun, a researcher at the Institute of Economy under the Beijing Academy of Social Sciences, said in order to limit Beijing's population from increasing, Beijing's city government should encourage administrative agencies and institutions to move to neighboring regions.
Wang Xiaoyu, director of the Baoding government office, said that although specifics of this policy have not been spelled out, the idea has been greeted enthusiastically by property developers from Baoding and neighboring cities.
Developers in Baoding have been promoting the benefits of buying houses in the city. Baoding's housing prices have been about 5,000 yuan ($805) per square meter since 2010. The latest National City Home Price Index show that Baoding's home prices fell 0.68 percent in February, while in March the figure soared 10 percent, stimulated by the new policy.
According to The Mirror newspaper in Beijing, new houses concentrated in the eastern and northern part of the city rose by 700 yuan per square meter. Soufun.com, one of China's housing portals, said shuttle buses used to pick up home buyers from Beijing and the Inner Mongolia autonomous region at Baoding train station only on Saturdays and Sundays. Now buses also run twice during the week.
But to many Baoding residents, the plans are a cause for concern.
Dai Wei, a local resident, said, "I bought a house in the southern district of the city 14 years ago when prices were about 3,000 yuan per sq m. Now it has already risen to more than 5,000 yuan. As a civil servant, I only earn about 1,000 yuan a month. I hope the housing prices won't go up too much."
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