Introduction
through the development of light manufacturing, China is as much a beacon as a rival. Other Asian economies, including Japan; Korea; Malaysia; Singapore; and Taiwan, China, have taken the same path, but at a much earlier time. China’s recent success magnifies the importance of its experience for current development efforts. China also illustrates a successful transition from low- to middle-income status: another reason its recent history is relevant to today’s lowincome countries. In the past, policy recommendations aimed at low-income countries have drifted toward extremes: first, they devalued the potential of the private sector and exaggerated the contribution of state action, and, then, more recently, they have sided with the Washington Consensus, which takes the opposite perspective by suggesting that government functions be limited to the (still important) task of establishing suitable conditions for private sector dynamism. However, our case studies show that manufacturing firms in developing countries face tremendous risks. Even if the potential rewards are correspondingly high, recent developing-country experience provides numerous examples of private sector initiatives withering for lack of public sector support. In contrast, the recent history of China and other East Asian countries shows that public-private partnerships can contribute mightily to the development of bottom-up light manufacturing clusters. This leads us to suggest that the best path for lowincome economies to realize opportunities to accelerate growth through light manufacturing involves harnessing the joint efforts of the public and private actors. This book consists of three parts. Part I documents China’s experience in the development of light manufacturing since the 1970s, including an examination of how China resolved the six binding constraints on growth in this sector. It also discusses the policy tools that China has used to turn the country into a powerhouse of light manufacturing within such a short period of time. The analysis is rounded out by selected case studies on light manufacturing initiatives in China. Part II offers case studies and analysis to highlight the experience of light manufacturing elsewhere in Africa and Asia with a view to examining additional instances of success and failure in addressing the six
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