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Strategies & Market Trends : HONG KONG -- Ignore unavailable to you. Want to Upgrade?

To: Ron Bower who wrote (2636)	1/7/1999 8:10:00 PM
From: Dayuhan	Read Replies (2) \| Respond to of 2951

Ron, This is a common criticism of SEZs, with some justification. When the first Philippine Export Processing Zone opened in Bataan, there was a lot of talk about attracting tech companies. The companies that actually came in were small/medium Korean and Taiwanese garment and shoe manufacturers. Philippine shoe and garment exporters had a few things to say about their government providing their competitors with subsidized infrastructure, rent, and utilities, not to mention the strictly enforced docility of the EPZ labor force. What percentage of the industries operating in the Chinese SEZs is in direct competition with firms outside the SEZs? Steve

To: Ron Bower who wrote (2636)	1/7/1999 8:30:00 PM
From: Tom	Read Replies (2) \| Respond to of 2951

Ron, I looked at the announcement once more. "The five special economic zones - Shenzhen, Shantou, Zhuhai, Xiamen and Hainan province - will not be affected." Of the remainder, the Singapore effort in Suzhou will receive an exceptional 4-year "winding down period." (Yes, of course, the Singaporeans will be excepted.) A couple of thoughts, that may have received some consideration, occurred to me as I read the article last night. I posted quite a while ago that I believed the Chinese would not emulate the Korean caboels, which was all-the-talk at the time, but would instead opt for a more competitive model. Large, yes. But with no, or little, preferential treatment. I thought too of China's desire to develop for the consumer a more competitive and, therefor, more dependable domestic market. Which would in turn provide for a more stable economy. Witness how the domestic consumer supports the U.S. economy. And the Chinese have about 800 million more of them than we do. Reminds me too of a news-article from several weeks ago subtitled, "You're on your own, chumps." Yes, the SEZ changes may not be received well by many foreign firms. But, as I was told rather emphatically several months ago while discussing China and U.S. foreign policy, "The U.S. will proceed with what is in its own national interest. As will China." I now consider that perspective more often. -----