Advertisement
China’s economic miracle has a secret ingredient hiding in plain sight: unbalanced growth
- Like the US, China’s economic dynamism rests on the imbalance between the runaway successes of its coastal provinces and the laggards along its northern rust belt. The crucial difference? Beijing redistributes the fruits of economic success
Reading Time:3 minutes
Why you can trust SCMP
The People’s Republic of China, which recently celebrated its 70th anniversary, can look forward to becoming the world’s largest economy by its 80th. The trade war with the United States may have slowed China’s ascent but it will not stop it. What has enabled China’s spectacular economic development in the past four decades? Unbalanced growth.
China’s double-digit economic growth has masked the more dramatic expansion at growth engines such as Guangdong and Zhejiang. Within Guangdong, the unbalanced growth is driven by the Pearl River Delta.
If one digs down to the municipal level, such as the case of Shenzhen, the growth rates can be staggering. In China’s remarkable success story, the true heroes are regions, cities and free enterprises.
Advertisement
Contrary to what former premier Wen Jiabao once suggested, unbalanced growth is not necessarily a problem; it can be an effective strategy. After all, Deng Xiaoping started China’s economic reforms with special economic zones.
In the late 1970s, the economic development of Greater China was highly unbalanced – Hong Kong and Taiwan being much more prosperous than the mainland. That very imbalance provided the basis for China to kick off its growth.
Leveraging on the capital, know-how and international networks of its compatriots, China’s growth naturally concentrated on its southeastern coast, with the closer clan and dialect affinities with Hong Kong and Taiwan.
Advertisement
Select Voice
Choose your listening speed
Get through articles 2x faster
1.25x
250 WPM
Slow
Average
Fast
1.25x