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Tales from the Development Frontier
commitment to economic reform, the relaxation of the controls over foreign trade and investment was gradually expanded to large cities and the entire coastal area, and the establishment of economic and technical development zones picked up. Some zones contributed significantly to regional growth and local government revenues. Success encouraged other provinces to establish and promote their own zones and to overcome obstacles in the business environment by building infrastructure and improving policies in targeted areas. A development zone rush took China by storm. By the end of 1992, more than 2,700 development zones had sprung up across the country, 23 times the number in 1991. Since then, government entities at every level have built development zones. As of mid-2012, there were 5 special economic zones (Hainan, Shantou, Shenzhen, Xiamen, and Zhuhai), 90 national economic development zones, 88 national high-technology industrial development zones, 22 duty-free zones, and 15 border economic cooperation zones.1 All enjoyed special treatment by the national government. Local and provincial governments support more than a thousand other industrial development zones. In 2010, nationallevel economic development zones contributed 7 percent of gross domestic product (GDP), 11 percent of manufacturing output, and 15 percent of foreign trade. They also accounted for 29 percent of FDI (CADZ 2010). The industrial parks were established as experimentation zones to test the potential of new methods of administration by concentrating limited investment on infrastructure. The idea was to invite foreign investment, introduce elements of market allocation (for example, by allowing enterprises to select their own workers, thereby avoiding the assignees of labor bureaus), and free local officials from “established administrative and management systems” so that they could become empowered to adopt unorthodox policies (L. Li 2009, 112–13). The intent was clearly to test the proposition that China’s socialist system was “fully capable of utilizing and assimilating the material wealth and management methodology created by capitalism” (L. Li 2009, 113). These experiments amply fulfilled Chinese leader Deng Xiaoping’s hope that they would “blaze a new trail” for the entire Chinese economy (L. Li 2009, 93). The special zones and industrial parks rapidly increased