Major Policy Tools
Figure 3.1 Industrial Output in the Four Initial Special Economic Zones, China, 1989 12,000
yuan, millions
10,000 8,000 6,000 4,000 2,000
en Xi
am
u Sh
an
to
ai uh Zh
Sh
en
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special economic zone total industrial output
industrial output of firms with foreign investment
Source: CADZ 1989. Note: In 1989, $1.00 was roughly equal to Y 3.80.
(Bao’an, Buji, and Longgang in map 3.2). The Shekou industrial zone, the first to open to foreign investment, occupied some 10 square kilometers in the southwestern corner of the Shenzhen special economic zone. Run as a wholly owned subsidiary of the China Merchants’ Steam Navigation Company—a state-owned entity based in Hong Kong SAR, China—Shekou downplayed light industry in favor of shipping and navigation, ship breaking, marine engineering, and the production of steel, oxygen, acetylene, marine paint, fiberglass, cargo containers, and ships. Nine other major industrial districts, occupying 14 square kilometers, were established in the Shenzhen special economic zone. Most were in the zone’s central and western districts, and most were comprehensive industrial districts for export processing (table 3.2).7 Export processing zones also appeared in other parts of the Shenzhen municipal area. Some were run by a development corporation under the township government. These zones attracted small overseas investors in light industry production, mostly from Hong Kong SAR, China.
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