GEOG 128
Geography of International Affairs

Special Economic Zones (SEZs) and Manufacturing


Chinese Central Television (CCTV) Series: China 30 Years

Now watch one more clip from the CCTV series on China's Special Economic Zones (SEZ):

Special Economic Zones

Click for a transcript of " 30/30: 1996 - Special Economic Zones" video.

And that's where we're going right now because by the mid 1990s China's reform and opening-up had brought a remarkable transformation to the country's economic landscape. The changes were most evident in the bustling business activities along the coastal regions, especially among the so-called special economic zones. Launched in the 1980s, the special zones were given flexible policies to conduct economic reform. In today's 30 in 30 series we look at this unstoppable trend of reform and the model of special economic zones.

In December 1996, policymakers was steadfast in the continuation and consolidation of economic reform. A national meeting was held in Shenzhen, China's first special economic zone. State Council officials said transformation in trade and business should alternate the country's development model between speed and quality optimizing trade structures and improving sustainability. 1996 was also the first year of a new five-year growth plan. Given achievements made in the past, officials said flexible policies would be granted to more cities and regions and more measures would be taken to reform the National Economics Center. On the same day, Xiamen celebrated its 15th anniversary as a special economic zone. Two ceremonies for construction projects for transportation will also help. An official from the National People's Congress said Xiamen had entered a second stage of development. As the country was set to deepen reform the city should serve just came accumulating relevant experiences as an economic testing ground.

Shenzhen and Xiamen were among China's earliest gateways to foreign investment. They were designated as special economic zones in the beginning of the 1980s. Both were chosen for geographical reasons. Shenzhen to attract investment through Hong Kong, and Xiamen to welcome businesses from Taiwan. For years the special economic zones took the lead country's economy, focusing on imports and exports as well as manufacturing. Their success encouraged the government to expand the scheme to cover almost the entire coastal regions opening more cities to foreign capital. By 1996 there were dozens of special economic zones around the country that had opened up to foreign trade and investment. Most were not officially designated, but in practice their experimenting was the same economic reforms. Their experiments were also encountering new issues and missions to maintain the growth of a newly established market economy and to explore ways to become more mature and innovative.

Optional Reading

If you are interested in learning more, you can check out the China accession protocol (pdf).

Chinese Central Television (CCTV) Series: China 30 Years

This final video clip from the CCTV series explores what is next for China, after 30 years of reform:

What’s Next?!

Click for a transcript of "What's next" video.

Well, after thirty years of reform and opening-up, China has transformed from a closed economy to a vibrant more open one. So, one of the natural questions is what's next? In the final episode of our Biz China 360 series, we look at future development trends as well as challenges and opportunities in the year to come.

Skyscrapers, high speed trains, fancy luxuries. China has not only achieved what it planned thirty years ago, but it has done so far more successfully than anyone ever thought. Looking forward, the world is curious about where China will go from here.

MELINDA LIU, BEIJING BUREAU CHIEF NEWSWEEK: We all are watching with great admiration and curiosity as to how things go from, from now on. I think we have all been extremely impressed with the past 30 years.

And the answer is clear, Chinese leaders have emphasized on various occasions that the country is committed to pursuing reforms and opening up. But as some experts say, the road ahead might be tougher than the previous several years.

BI JIYAO, DEPUTY DIRECTOR INST, FOR INT'L ECONOMIC RESEARCH, NDRC: Before the different kinds of reform, may be more difficult than before because we are facing more complex problems than 30 years ago.

Fast economic growth has certainly resulted in some side effects. An income gap, environmental issues, problems with the health care and pension system, and an aging population. These are some of the concerns voiced by the public. While admitting the top challenges ahead, premier Wen Jiabao said at the 2008 summer doubles in Tanjing, that the fundamental solution to all these problems lies in the deepening of the reforms.

WEN JIABAO, CHINESE PREMIER (ENGLISH SUBTITLES): We will continue to deeper economic reforms. We will further improve the basic economic system and market systems, deepen reforms of the fiscal, tax and banking systems; and improve the macro-economic regulatory system. Only by continuing reforms and opening up and unswervingly following the path of socialism with distinctive Chinese features can China have a bright future.

Experts also pointed out that transforming the export based economy to a consumption-based one is a also a highlight of future reforms - especially at the time when the global financial tsunami is weakening external demands.

BI JIYAO, DEPUTY DIRECTOR INST, FOR INT'L ECONOMIC RESEARCH, NDRC: If China can maintain economic growth, that will make a greater contribution to the world economy. As you know China has become a very important engine for where the economy goes and the reason is our government has formulated a series of important policy matters to stimulate the master demand.

MELINDA LIU, BEIJING BUREAU CHIEF NEWSWEEK: I think now much of the world is looking to China to actually lead the way out of this global recession, partly because it has a lot of wealth as you say a lot of money, the government has a lot of money. And partly because it's, you know economy is somewhat buffered from a certainly the American and the European recession that we see going on now. I think if there's any country that could, could afford to spend its way to you overcome the current challenges in the global economy it would be China. It's very lucky that way.

With ever-increasing integration with the world economy, China is becoming more active and important on the international stage. Thirty years of reform and opening-up have brought historic changes to China's development creating a rocketing economy that is now the fourth largest in the world. For the ordinary person on the street, the past 30 years have not only meant better clothes and food, but also China's rise on the international stage and that is what makes them proud to say, I'm Chinese.

Let's see what they're hoping for in the years to come: "I hope China is regarded not only as a large country. I hope China's technology development will enter a new stage." "I hope our country will become stronger, and our economy will develop faster and be more integrated with the world." "I am very confident in China's future. China will become better and better."

Let some people get rich first, and then help the rest to achieve a good standard living. That's one famous phrase from late China's leader Deng Xiaoping. The past thirty years has proven China to be very successful at the first part, and now the country is on its way to achieving the second part of it, and that is what the reform and opening up is all about. This is Feng Ling reporting for Biz China 360.