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Guangdong can top Taiwan but at what cost: analysts

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Guangdong Governor Huang Huahua's prediction that his province's economy will surpass that of Taiwan's in 2010 is achievable, but big questions hang over the impact of such growth on the deteriorating environment and whether the economy can increase incomes and narrow the wealth gap, analysts have said.

A bigger Guangdong economy would not diminish Taiwan's status, since its per capita gross domestic product was four times greater than Guangdong's US$3,000 and its ability to be innovative was much stronger, they said.

Economist Lin Chu-chia, of Taiwan's National Chengchi University, said: 'We don't mind if they are bigger or overtake Taiwan. We care more about per capita GDP. We are happy to hear they are developing fast but if their per capita GDP is only US$3,000, it will take them a long time to catch up.

'What we are concerned about is our own growth rate. We hope to return to a 5 per cent growth rate. If we do that and the mainland keeps growing at 10 per cent, catching up will take more time.'

David Zweig, director of the Centre on China's Transnational Relations at Hong Kong University of Science and Technology, questioned the quality of technology in Guangdong, the province's ability to be innovative and its standard of education.

'Guangzhou and Shenzhen are working to be innovative cities but Shenzhen still has a long way to go before catching up with Hsinchu [Taiwan's Silicon Valley],' he said.

Lingnan College economist Wu Yingxin said the Guangdong government was 'very optimistic' in its forecast.

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