SEZs: Lessons from Chinese Experience

Abstract

China developed SEZs in late 1970s to encourage foreign investment, bringing much needed jobs, technical knowledge and future tax revenues. Chinese government’s objective was to bring back compatriots in Hong Kong, Macao and Taiwan. The first four SEZs (Shenzhen, Zhuhai, Xiamen and Shantou) were set up along southeastern coastline and were close to trading and financial centres of these regions. Current SEZs are located in Guangdong province, Fujian province, Hainan province, Hunchun and Pudong development zone (Shanghai). Shenzhen, Zhuhai and Shantou come under Guangdong province, Xiamen comes under fujian province while entire province of Hainan is designated as SEZ.