FOREIGN MANUFACTURING INVESTMENT AND REGIONAL INDUSTRIAL-GROWTH IN GUANGDONG-PROVINCE, CHINA

In this paper, information from four major studies of Hong Kong's manu facturing investment in China, as well as published statistics concern ing foreign investment in Guangdong, and data from a detailed investig ation of seven manufacturing firms in Hong Kong are drawn upon in orde r to detail the locational and sectoral characteristics, the productio n and linkage attributes, and the regional economic impacts of foreign manufacturing investment in Guangdong Province, China. It is found th at, geographically, foreign manufacturing investment clusters in Shenz hen and Guangzhou, with Dongguan, Huizhou, Zhuhai, and Shantou as the secondary centers of concentration. Sectorally, investment from Hong K ong is concentrated in the electronics, garment, and textiles industri es, whereas investment from other countries is centered in electronics , construction materials, transport equipment, and chemical industries . Foreign manufacturing investment in Guangdong is directed at a diver se array of activities, of which a significant amount involves work th at is technologically similar to that conducted in the source countrie s. These beneficial impacts are attributable primarily to the extensiv e production decentralization from Hong Kong, the social affinity betw een Hong Kong and the Zhujiang Delta, the ability of the state to cont rol foreign investment flows, and the entrepreneurship and ingenuity o f individual locales in the province. The impacts are especially conce ntrated in the Shenzhen region. This region, along with the Foshan and Guangzhou regions, is likely to become a major industrial district in Pacific Asia.