Chinese Manufacturing Giant Outgrows its Cradle

Plans are afoot to transform Guangdong Province, China’s manufacturing base, into a center for high-tech industries. From AP:

It’s not just the global slowdown. In Guangdong’s Pearl River delta, where the capitalist drive was launched on the coattails of rich neighbor Hong Kong, a new realization is taking hold — raw materials cost more, labor and environmental laws have grown stricter, exporters are getting fewer tax breaks, and a string of product recalls have raised questions about Chinese quality.

So China has a sweeping plan to transform the region. Rather than bail out weak, labor-intensive factories, it wants them to move to the interior so that Guangdong can become the country’s auto maker and its Silicon Valley.

“We have a policy to empty the cage for the new birds,” said Wan Qingliang, a provincial vice governor.

The financially troubled world is watching, especially the United States, China’s biggest trading partner, something Wan possibly had in mind in meeting foreign reporters for a rare briefing.


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