CRRC employees operate an assembly line of the company in Qingdao, Shandong province. [Photo by Zhang Jingang/For China Daily]

China's "dual circulation" economic development pattern will further release Qingdao's potential and prompt the city to play a pivotal role in China's higher-level opening-up, according to its top official.

Wang Qingxian, Party secretary of Qingdao, said the pattern will give full play to Qingdao's unique dual role of opening wider to the rest of the world and driving economic development in northern China.

The "dual circulation" pattern focuses on the domestic market as a mainstay, with the domestic and foreign markets expected to complement each other.

Wang said "domestic circulation "aims to share mutual benefits between northern and southern areas of the country, as well as eastern and western regions.

"Qingdao can play such a role, as it is a developed eastern coastal area and also an economic marine gateway to nine provinces and regions in the Yellow River Basin," he said.

"Qingdao can help drive overall economic development in northern China. Compared with the south, there is insufficient overall vitality in northern China due to a lack of reforms."

To solve this problem, Qingdao has launched a series of market-oriented reforms to prepare new growth engines, including developing the industrial internet and establishing a market allocation promotion office in 17 government departments dealing with economic affairs.

"The aim is to prompt the government to better understand the market, respect and use the laws of the market, and further improve the market operating mechanism," Wang said.

"Not all reforms can be called reforms. Only those that conform to the natural laws of the market and unleash productivity can be so-described," he added.

The way in which the government positions itself for reforms based on the market will determine whether they succeed, he said.

"Any effective market cannot be separated from a capable government and every capable government needs to respect the market rules," he said.

"If the market mechanism is not perfect, then the government should cultivate the market, instead of replacing it. More efforts are needed from the government to fill the void when the market cannot adjust itself effectively in some fields."

Qingdao has sent the first batch of 51 government cadres to carry out professional training at modern service industry enterprises and organizations in Shanghai.

"This is part of the city's reforms to actively link up with Shanghai's modern service industry to build an important northern hub to promote domestic circulation," Wang said.

In less than two months, a large number of modern service enterprises, professionals and institutions from Shanghai, including those in the fields of finance, shipping, trade, high-tech services, cultural tourism and business services, arrived in Qingdao to invest and settle in the city.

Zhao Zhongxiu, president of Shandong University of Finance and Economics, said Qingdao and Shandong province should focus on institutional innovation and find a unique method for high-quality economic growth by using their key locations and abundant resources.

"The province should use its free trade zone opportunities to become more involved in regional economic cooperation between China, Japan and South Korea, as well as the Belt and Road Initiative. It should also play a bigger role in improving exchanges of capital, technology, talent and information between eastern and western areas," Zhao said.

In August last year, Qingdao became a key part of the China (Shandong) Pilot Free Trade Zone, one of six new free trade zones set up nationwide.

Wang, the Qingdao Party secretary, said, "Shandong is the only coastal province among the nine provinces in the Yellow River Basin, while Qingdao is the bridgehead for Shandong opening up to the world.

"As a new important strategic pivot for international cooperation under the Belt and Road Initiative and the New Eurasian Land Bridge economic corridor, the city will play a key role in promoting cross-regional cooperation."