ABSTRACT

Guangdong and Fujian were given the same policy prerogatives by the central government of China to experiment with special economic zones, and an aggressive policy of economic liberalization. The policy and institutional changes brought a change in the orientation of the economic development of the local economy, and has been responsible for the economic growth miracle in the province since the mid-1980s. With the greater economic dynamism of Taiwan, a result of the greater comprehensiveness and higher technological and capital intensity of its industry, there is more room for economic cooperation and integration of Guangdong with Taiwan through a further increase in trade and investment. During 1979-85, the provincial economy of Guangdong began to realize its comparative advantage under a regime of more liberalized economic policies. The economic development or Guangdong since then may be divided into two stages, the first from 1979 to 1984, and the second from 1985 to the present.