Ripples on a Pond

Abstract

We suggested in Chapter 3 that the first spur to the Chinese economy, in the early years of reform, came from a boost in incomes and the liberation of production in the localities for domestic consumption; this, however, was not able to sustain its momentum, and the turn to exports became the main engine of further growth. Advocates of export oriented industrialisation have applauded this move into the world market as the key to economic development. Critics of export oriented policies and of the development of export processing zones in third world countries, on the other hand, argue that these would be no more than short term offshore production platforms for first world investors. High profits would be made from the super-exploitation of (mainly female) workers while the impact back into the rest of the country would be minimal. When cheaper sources of labour were offered elsewhere, the investors would move out, leaving little behind.