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SCMP Reporter

I SHOCK, therefore I am. This touchstone of political stardom also applies to many Chinese cadres.

  Deng Xiaoping's early fame partly rested on his heretical dictum about the white and black cats. The late party chief Hu Yaobang disturbed the Communist-Chinese universe in 1985 when he conceded that 'Marxism cannot solve [most of] the problems of today'.

  There was neither thunder or lightning in the speech on Guangdong's Ninth Five-Year Plan (1996-2000) delivered by Governor Zhu Senlin to the provincial people's congress last weekend.

  Its blandness befits an official going out of the mainstream: Mr Zhu, 65, will this week be transferred to the Guangdong legislature.

  Apart from an understated act of subversion - Mr Zhu mentioned president and Communist Party chief Jiang Zemin only once in his 28-page, 21/2-hour talk - the veteran head of the Guangdong administration dutifully toed the central line.

  Mr Zhu and his colleagues seem reconciled to the fact that the 'before-the-times province' has lost the number one status so eloquently celebrated by the likes of Harvard economics guru Ezra Vogel.

  The annual growth rate of the get-rich-quick region will be 11 per cent for the coming five years, down from 19 per cent in the 1991-1995 period and 13.5 per cent during the Seventh Five-Year Plan (1986-1990).

  The rate of increase in capital construction, mostly infrastructure and plant, is fixed at 30 per cent, or five percentage points lower than the national mean.

  A near-moratorium has been put on activities that have contributed most to the wealth of the province's tens of thousands of nouveau riche 'red capitalists': real-estate and stock-market speculation, as well as questionable deals this side of smuggling by naval vessels.

  Guangdong is apparently resigned to the fact that preferential policies particularly for cutting-edge sectors such as finance and high technology will be 'reserved' for such new Beijing favourites as Pudong, which is anticipating an annual growth rate of 20 per cent for the next decade.

  Shanghai-Pudong also seems destined to be the financial hub of the country, with the Shenzhen Stock Exchange becoming a backwater bourse.

  In his blueprint, Mr Zhu outlined ambitious plans for new industries such as vehicles, electronics and petrochemicals.

  Guangdong, however, already suffers from high land and labour costs, and its talent pool is inferior to that of Shanghai and even Tianjin.

  For the first time in memory, authorities have forecast a drop - of 6.2 per cent or US$630 million (about HK$4.86 billion) - in foreign investment this year.

  Above all, Guangzhou's legendary flexibility in retooling its industrial and enterprise structures has been dented.

  Hewing to the neo-conservative leadership's injunctions against privatisation, Guangzhou is mouthing slogans about 'grasping large-scale enterprises well', a euphemism for propping up government-owned units even if they are losing money.

  In light of the new emphasis on protecting the 'vanguard of the proletariat', Guangzhou can no longer foreclose enterprises freely.

  In fact, Guangdong units have to satisfy at least one of several criteria before they can lay off staff: continuous losses of over three years; 50 per cent below-capacity production for a year; and inability to pay workers for more than three months.

  In spite of the continuing credit squeeze, the province is told to empty its coffers on less glamorous - and less lucrative - goals such as achieving self-sufficiency in agriculture; helping the poor both locally and in other provinces; and Mr Jiang's pet project of building up 'spiritual civilisation'.

  The Guangzhou leadership has been savaged for letting the province become a disaster zone for such bourgeois-liberal ills as corruption, prostitution and triad gangs.

  The congress was told on Monday that police and procuratorate departments had last year handled 1,866 cases of corruption involving at least 10,000 yuan (about HK$9,300) each, up 28.8 per cent from 1994.

  Guangzhou officials have since vowed to devote massive human and material resources to setting up 'patriotic education centres' and quasi-Maoist campaigns.

  No less gung-ho a cadre than provincial planning chief Lin Shusen has cited the following aphorism on Guangdong's bumpy development: 'We give out fragrance for a few years, then stink for a while; foul alternates with fair as the years go by.'   At least in the eyes of Hong Kong and Western observers, is Guangdong destined to enter a cycle of deceleration, if not, decline?   Not so fast, in spite of its humbled station, Guangzhou has scored a couple of victories in its long-standing slugfest with the central authorities.

  Mr Zhu's successor is Vice-Governor Lu Ruihua, a native son who has strong support in the Pearl River estuary.

  Beijing had until late last year pressed for an outsider.

  Moreover, provincial party secretary Xie Fei, who tops Beijing's hit list of regional 'warlords', has been allowed to stay on until the 15th Party Congress in October 1997.

  AFTER more than a decade of unrivalled development, Guangdong has trump cards galore to go an extra mile.

  The province has the highest concentration of private businesses and its citizens have thick wads of cash in the banks.

  The well-entrenched entrepreneurial spirit has yet to be cowed by the cold air from up north.

  Earlier this year, Guangzhou and the Shenzhen special economic zone became the nation's first cities to extend 'national treatment' to foreign companies, meaning the latter can compete on the same footing with domestic enterprises.

  At the congress, Mr Zhu did some vigorous lobbying on two new-fangled experiments: selling shares of state enterprises to overseas companies; and inviting foreign firms to form conglomerates with Chinese enterprises.

  Equally significant, Guangdong seems poised to reap a sizeable windfall from the 1997 factor.

  During his two trips to the SEZs of Shenzhen and Shantou in the winter, Mr Jiang gave assurances to local cadres and Hong Kong entrepreneurs that Beijing would speed up the approval of labyrinthine infrastructure projects linking the Pearl River estuary and the future special administrative region.

  While the go-go province's ability to shock the world may have receded somewhat, it has hardly relinquished its claim to be number one.



Guangdong's on a roll