ABSTRACT
While the economy of Hainan stagnated during the 1990s, the Pan-Pearl River Delta in Guangdong Province emerged as China’s most dynamic economic area. Guangdong Province has for the last two decades registered growth rates higher than most other provinces. It has for 15 years been the number one province in China in terms of attracting foreign direct investment and it has consistently accounted for one-quarter of the value of China’s export to foreign countries. Guangdong benefits greatly from its proximity to Hong Kong and Macao. Most of Hong Kong’ s manufacturing capacity has shifted to the Pearl River Delta and more than 42,000 motor vehicles and 470,000 persons travel between Guangdong and Hong Kong and Macao every day. The establishment of the Closer Economic Partnership Arrangement (CEPA) in June of 2003 strengthened even more the opportunities for cooperation between Guangdong and the Hong Kong and Macao SARs.1
The aim of this cooperation, in the words of Guangdong party secretary Zhang Dejiang, was to turn Guangdong into a world manufacturing base, Hong Kong into an international financial and logistics center and Macao into a regional service platform and tourist center.2 In July 2003 the Guangdong leadership raised the idea of creating further synergies and development possibilities in the region by forming a so-called Pan-Pearl River Delta Economic Sphere. It involved closer cooperation between nine southern provinces and the Special Administrative Regions (SARs) of Hong Kong and Macau (“9+2”). The nine provinces were Sichuan, Hunan, Jiangxi, Yunnan, Guizhou, Guangxi, Fujian, Guangdong and Hainan. The objective was to turn the region into a new economic growth pole centered on Guangdong and Hong Kong.
