The Political Economy of China's Economic Zones

In 1979, China established four Special Economic Zones (SEZs) which offered financial inducements to foreign investors. 14 coastal cities were included in the mid 1980s, but by 1985, these SEZs were corrupt and problem-ridden. This text discusses what went wrong and the relevance of the SEZs.

In 1979 China launched a new international economic policy with the establishment of four Special Economic Zones (SEZs): Shenzhen, Zhuhai, and Shantou in Guangdong Province and Xiamen in Fujian Province. Modelled loosely on export processing zones and free trade zones found in other less developed countries, the SEZs offer a variety of financial inducements to foreign investors in order to harness international business for national economic advantage. Designed to be a cornerstone of China''s economic reforms, by 1985 the SEZs (in the mid-80s zone-like policies were extended to fourteen coastal cities) were scandal-ridden and fraught with serious problems. This work, the first book-length analysis in English of China''s SEZs, examines the problems and promise of this innovative approach to "structural economic reform" and the comparative significance of the SEZs.