Southern China, Hong Kong, and Taiwan: Evolution of a Subregional Economy, and: Hong Kong's Economic and Financial Future (review)

Reviews 181© 1997 by University ofHawai'i Press Jane Khanna, editor. Southern China, HongKong, and Taiwan: Evolution ofa Subregional Economy. CSIS Significant Issues Series, vol. 17, no. 7. Washington, D.C.: The Center for Strategic and International Studies, 1995. xvii, 91 pp. Paperback $14.95, isbn 0-89206-321-1. Y. F. Luk. Hong Kong's Economic and Financial Future. CSIS Significant Issues Series, vol. 17, no. 6. Washington, D.C.: The Center for Strategic and International Studies, 1995. xi, 80 pp. Paperback $14.95, isbn 0-89206306 -8. These two slim paperbacks deal with the economics ofa region encompassing Hong Kong, Taiwan, and the mainland provinces of Guangdong and Fujian. The books constitute a welcome and useful guide to the world's most rapidly developing economic region, and are made timely by the approach ofmidnight, June 30, 1997, when the regional economic kingpin ofHong Kong becomes part ofChina. The two volumes lay out data tiiat add up to a mildly optimistic economic outlook for Hong Kong, for the region, and, one can conclude, for China. The shoals that may wreck this prognosis, according to these volumes, seem principally to be political aspirations, economic nationalism, and military security. The subregion that is analyzed in the Khanna book is described in Robert Scalapino's foreword as the most successful ofa number ofnewly formed "natural economic territories" or NETs. These have emerged along the periphery of China spontaneously and without political framework or formal agreement and have facilitated economic development across national boundaries more rapidly and efficiendy than any international bureaucracy could have done. Scalapino describes fhe Hong Kong-Guangdong and Taiwan-Fujian NETs (which are sometimes treated in the book as one mega-NET) and also several nascent NETs: Shandong-South Korea, the Tumen River delta (sections of fhe Chinese province ofJilin, ofnorthern North Korea, and of the southern Siberian coast of Russia), and Southwest China-Myanmar-Thailand-Vietnam (the latter, in this reviewer's opinion, more noteworthy so far for narcotics production than for other forms of economic development). Shanghai, with a variety offoreign sponsors, should have been added to this list. Ofall the Chinese provinces involved, only Guangdong and Fujian have taken off economically; these have become engines of growth for all of China, and it is these that fhe book discusses. It can be argued that the NETs are the modern equivalent of old imperialist spheres ofinfluence and "concessions," as they were called in Manchu China, and of the warlord satrapies that developed in early Republican China. Insofar as there are similarities, it is ironic that the NETs, which are models of economic i82 China Review International: Vol. 4, No. 1, Spring 1997 spontaneity and governmental noninterference, are being encouraged by the remaining major regime fhat still styles itselfas revolutionary and Communist. The importance ofthese NETs goes beyond historical analogy or ideological pretensions . The critical question in the realm ofeconomics at the dawn ofthe twentyfirst century is whether and how fhe ex-Communist states (including those for the moment retaining Communist nomenclature) can overcome many decades of economic bungling to join most ofthe rest ofthe world in prosperity and progress. For China the answer that is emerging is that such development is possible and that it will be played out in a format ofregionalism, as described in the Khanna book. Khanna's book is weakened by the fact that it is a compendium ofessays of varying caliber. One ofthese is fhe text ofa short speech by a Hong Kong bureaucrat perhaps included by CSIS for political reasons. (The speech, subtided "keeping bureaucrats out ofbusiness," might as well have been delivered at the 1996 Republican National Convention.) To keep nitpicks all together: it is incumbent upon a reviewer to find errors and typos. The CSIS volumes are edited and compiled with great care, but even so, the Khanna book on page 15 gives the area of Fujian too small by an order of magnitude, and both volumes occasionally fall prey to the terrorism of the electronic spelling checker, as when the Khanna book (p. 77) refers to "island" provinces of China where perhaps "inland" was intended. The virtues ofKhanna's book include brevity and clarity. Most of the discussion...