In 2001, the Shenhe District of Shenyang City began to implement a plan titled “Outline for Improving Civic Morality,” intended to fight business tax evasion, cheating, and sales of pirated and low-quality commodities, while encouraging self-regulation by entrepreneurs. The Bureau of Industry and Commerce Administration, cooperating with other concerned departments in district government, drafted plans for the development of a centralized, regulated business district, which, after five years of work, is three-fifths complete.
This “Outline for Improving Civic Morality” is an initiative generally operating on three levels; first, the district has drastically revised and strengthened its role as a regulator of Shenhe’s enterprises. Second, the government has increased the accountability of both its businesses and its own operations to the public, establishing a series of consumer and citizen protection mechanisms. Finally, the Shenhe government has actively solicited the participation of students and community members as volunteers in local welfare initiatives to improve the general livelihood of local families in need.
The primary goal of this innovation is business regulation and urban development. With this mission in mind, the Shenhe District Government drafted a system for classifying and grading Shenhe enterprises according to a “credible enterprise” model formulated in partnership with the Shenyang branch of the Chinese People’s Bank. Local bureaucrats supplemented these business regulations with campaigns to improve the transparency of Shenhe’s government regulation framework, founding a website for government affairs and credible business districts (www.c-cbd.com
). Innovators established an office to respond to citizens’ complaints, and drew up charters for excellence in service in business. In 2004, Shenhe District spent 100 million yuan (approximately U.S. $12.91 million) to establish a stable fund to solve problems arising from consumer complaints and difficulties encountered by citizens of Shenhe.
Broadening their definition of credibility, local bureaucrats began an initiative to “Support Households in Difficulty” through a welfare system with food provisions available to families in need at the district, street, and community levels of distribution. The “Outline for Improving Civic Morality” has extended into the education system, with schools and individual volunteers encouraged to participate in social welfare programs.
The social and economic benefits of this urban renewal project have been demonstrable: the environment for investors has improved as regulations have become clearer. In targeting tax evasion, government income has increased from 200 million yuan (U.S. $25.81 million) in 2001 to 700 million (U.S. $90.34) million) in 2004. In 2003, Shenhe became one of the “Top 50 Districts With a Safe and Credible Investment Environment in China,” in part due to the active efforts the district government is making to redress citizen concerns regarding Shenhe’s economic development.