ABSTRACT
Greater South China was East Asia's first and most successful subregional economic zone. The impetus for its formation came primarily from the economic liberalisation of China, and secondarily from the economic liberalisation of Taiwan. Many barriers to the economic integration of the trio remain, the main ones being the remnants of central economic planning in China and Taiwan's ban on direct business links with the mainland. Greater South China comprises Hong Kong, Macau, Taiwan and the Chinese coastal provinces of Guangdong and Fujian. Private initiatives and market forces have led to intense trade and investment flows within Greater South China. Even before China initiated its open door policy, the economic ties linking China and Hong Kong were quite strong. Hong Kong's large share of investment in China conceals its important role as an intermediary. Hong Kong's investment in China is highly diversified, covering projects ranging from small-scale, labour-intensive operations to large-scale infrastructure.
