Government policies:Special Economic Zones (SEZ)

China’s Regional Policy

5-year plans

What is a Special Economic Zone?• 1980 – Shenzhen SEZ set up – 1st of many• Designed to attract investors – foreign• Special tax incentives for foreign investors• Some joint ventures – Sino-British etc• Provincial level government• Mainly export-oriented• Market-driven• Largely labour-oriented• Increasing no’s of high-tech industries

China’s first SEZ

http://news.xinhuanet.com/english/2009-05/22/content_11416541.htm

Why Shenzen?• Close to Hong Kong – attract investment from

established firms there• Experiment in “socialism with Chinese

characteristics”• City population now over 8 million• Considered a successful project – taken up

elsewhere• Focus of Pearl River Delta area – China’s

economic powerhouse• 1990s - Shenzhen "one high-rise a day and one

boulevard every three days".

Shenzen, & from Hong Kong

Rapid growth

• 1982 – 350,000

• 1990 – 1.3 mill i.e., a 245% increase

• 2000 – 2 mill, i.e., a 477% increase

• 2010 – 10.4 mill (approx 48% increase)

Which firms?Primarily manufacturing (often very high technology)

but also, increasingly, tertiary industries:• IBM• Huawei (telecommunications)• Skyworth (electronic components)• Apple - Taiwanese firm makes iPods, iPhones etc• Walmart• Ping An Insurance• Banking – China Merchants Bank

• 2010’s GDP - 95,000 yuan (US$14,615), 4th in country (same as Argentina & Malaysia, more than Lebanon & Mexico!)

What about the rest of the country?

• The core-periphery concept applied to China:

• Core – the eastern coastline & southern China to Hong Kong

• Periphery – the rest of the country• http://news.bbc.co.uk/1/hi/programmes/

impact_asia/8655134.stm

• What is the Core & Periphery concept?

Province Pop. % rural / urban

rural / urban p.a. growth % ethnic

income (RMB) minorities

Shaanxi 36m 67 / 33 1,186 / 4,891 0.71% 0.6

Gansu 25m 76 / 24 1,400 / 4,890 1.00% 8.3

Qinghai 5.8m 64 / 36 1,490 / 5,170 1.45% (2.5%)

44

Xinjiang 18m (>90% in oases)

1,618 / 5,817 1.28% 61.4

China 1,3b 64 / 36      

Beijing 12m   3,441 / 8,493 c. 2.5%3m MWs?

Shanghai 17.7m   4,138 / 8,864 <1% 0.4

(4.4mMW)

https://www.youtube.com/watch?v=y0pq1qM5rJU

• https://www.youtube.com/watch?v=a70tmppdo_I

5-year plans

• Government strategic plans first begun in 1953

• Each focuses on a particular strategic development need.

• 1st Plan – State ownership; collectivisation of farming along Soviet lines; centralised planning.

• Current (12th) 2011 – 2015.

• Current Plan includes: • secure economic growth &

economic structure,• urbanise the population – 52%• Develop HEP & nuclear energy• encourage sound, sustainable

developments• Increase length of high speed rail

line, roads, new airport for Beijing• New development inland• Coastal areas = R & D & high

end manufacturing, services.• Affordable housing• Encourage FDI – agriculture,

high-tech inds, environmental practices

• Control population @ 1.3bn.

Since the 1978 Reforms national & regional development have been the main focus of policy making.

Regional policies/strategies:

Coastal Development Strategy, Metropolitan Growth Pole Strategy, Western Development Strategy,Rejuvenating Northeast StrategyDeveloping the Middle Area Strategy

• January 2012

• 13. Examine the factors responsible for the growth of China’s economy. [25]

• Deadline: Thursday 15th January