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The Pearl River Delta Mega Urban-Region Internal Dynamics and External Linkages The Pearl River Delta Mega Urban-region Internal Dynamics and External Linkages Yue-man Yeung Shanghai-Hong Kong Development Institute Hong Kong Institute ofAsia-Pacific Studies November 2005 Shanghai-Hong Kong Development Institute Occasional Paper No. 12 The Pearl River Delta Mega Urban-region. Internal Dynamics and External Linkages About the Author Yue-man Yeung is Research Professor; Director of the Hong Kong Institute of Asia-Pacific Studies; and Director of the Shanghai-Hong Kong Development Institute, The Chinese University ofHong Kong. After China adopted a bold policy initiative of economic reforms and openness in 1978, Guangdong and Fujian were the two provinces designated for their experimental implementation. The Pearl River Delta (PRD) region in Guangdong seized the opportunities offered by the gradual decentralization of authority and by the region's Keynote address presented at the 8th Asian Urbanization Conference, proximity to Hong Kong to launch a process of rapid economic University of Marketing and Distribution Sciences, Kobe, 21 August and social transformation. By the end of the 1980s, I was among 2005. several scholars who observed the beginnings of the establishment of a megalopolis, of which Hong Kong and Macau was to be a part (Chu et aI., 1990). By the 1990s, the rapid changes in Guangdong had consolidated across a broad spectrum of life, with the PRD paving the way. At the time of Hong Kong's handover in 1997, I highlighted the increasing integration of the territory with its natural hinterland in the PRD (Yeung, 1997). It was becoming clear that Hong Kong's integration with the PRD was being increasingly subject to the forces of globalization, and that the economic development taking Opinions expressed in the publications ofthe Shanghai-Hong Kong Development place in the Greater PRD (GPRD, i.e., the PRD plus Hong Kong and Institute and Hong Kong Institute ofAsia-Pacific Studies are the authors'. They Macau) was integrated with the global economy (Yeung, 1999; also do not necessarily reflect those of the Institutes. Yeung, 2003). As Hong Kong has celebrated the eighth anniversary of its handover in July 2005, it is opportune to revisit the issue of the evolution of the PRD into a mega urban-region. What have been the © 2005 Yue-man Yeung recent drivers of change and what prospects does the future hold for the region? ISBN 962-441-812-8 This paper attempts to approach the subject by, first, examining All rights reserved. No part ofthis book may be reproduced in any form without the internal dynamics that have furthered the integration of the written permission from the author. differentjurisdictions ofthe region. They include spatial and economic 2 The Pearl River Delta Mega Urban-region The Pearl River Delta Mega Urban-region 3 changes, urban and regional reorganization, Hong Kong and Macau Figure 1 The PRD and Its Constituent Cities as catalysts of change, and investments in infrastructure. Second, r""', ;~(_I-\ () '-­ ~~) ~~} along with the rapid internal integration, the external linkages of the ,. - \ , .f< ; // t GPRD are scrutinized. The external orientation was established with <', ,1'/ J c~/' China's accession to the World Trade Organization (WTO) in late i ~. ~~.j ~ I~' ) 2001, with vital implications for the region. In the same year, China ", ? I"'~ )0 I /' 0 (: ~~. r' .r also entered a trade pact with ASEAN, offering new economic and '"i B / J ..r") . -'f social links to the region. The formation ofthe Pan-Pearl River Delta .... I ~ )"\r J ~ ! 'J (Pan-PRD) framework in 2004 is further accentuating the internal / .J .\tr~~ < Guanszhou.:.· .. r (' .r cohesiveness and external links of the GPRD. A short concluding !("\ ! /~ ,,-/ section will assess the prognosis for the region by 2020. " • ~ - Huizhou c~. 1 Internal Dynamics --- PRO boundary ...• PrefectlK8-lII'vel The PRD, consisting of nine prefecture-level cities, namely city boundilly Guangzhou, Shenzhen, Zhuhai, Foshan, Jiangmen, Dongguan, II 20 4lI so lll)aa..rn..... Zhongshan, and part of Huizhou and Zhaoqing (Figure 1), accounts ~I.I.I for 23 per cent of Guangdong's area but 80 per cent of its gross domestic product (GDP), or one-tenth of the nation's. It has achieved a level of urbanization of 72.7 per cent (Ta Kung Pao, 18 January 2005). After 25 years of creativity and hard work, coupled with a China's 100 strong enterprises in these sectors, 24 were located in dose of luck, the PRD has helped spearhead China's modernization the PRD, with two even among the top 10. Information technology and development programme that has so caught the world's attention. is well developed in the region, with national-level IT parks having It has now become one of the richest regions in China and one of the been established in Shenzhen, Guangzhou, Zhongshan, Foshan, most competitive in the world. Huizhou, and Zhuhai; and provincial-level IT parks in Jiangmen, The luck that was on the side of the PRD in its passage to rapid Shantou and Dongguan, providing a sound base for the development growth was one of timing. Its pursuit of industrialization from a low of hi-tech in the PRD (Chen et aI., 2003:98). In 2001, the value of base, with the infusion ofcapital, market information, and management hi-tech products produced in the PRD reached RMB325.5 billion, skills from Hong Kong in the early 1980s coincided, fortuitously, with accounting for Guangdong's 93 per cent ofthe value of similar goods the onset of a phase of accelerated globalization that came with an produced and making the PRD China's top production area (Chen et enhanced demand for manufactured goods (Yeung, 2000). By 2000, aI., 2003: 116). Similarly, the PRD accounted for the lion's share of the electronics and communications industries constituted within the the IT, electronics, and electrical appliances manufactured in China, delta a cluster of the most spectacular growth, with a concentration with telephones reaching 78.8 per cent, electrical fans 88.2 per level of 32.1 per cent, ranking first in China. They also accounted cent and hi-fi equipment 80.4 per cent (Enright et aI., 2003:40; also for over 19 per cent of China's production in these industries. Of Enright et aI., 2005). Not surprisingly, therefore, the PRD has earned 4 The Pearl River Delta Mega Urban-region The Pearl River Delta Mega Urban-region 5 the sobriquet ofChina's "global factory", since approximately 40 per population of temporary residents who, not having a household cent of China's exports is traceable to the PRD. registration or hukou pi D, are not included in the official count of the population. Many migrants prefer to move to towns and smaller Spatial and Economic Changes cities first, avoiding large cities because of stringent government Anyone travelling by trainbetween Hong Kong and Guangzhou during regulations and high living costs. Almost invariably, the population the past two decades would have noted the drastic transformation of large cities is heavily underreported, as even up to one-quarter or of the physical landscape. Fish ponds, farms, and agricultural land more of their population consisting of temporary residents without a have given way to industrial and residential developments, to such hukou registration are left out ofofficial statistics. an extent that new towns, industrial parks, and urban landmarks have With the nine cities within the PRD accounting for the bulk of completely changed the character of this most travelled corridor of the provincial economy, the relationship among them has' changed the PRD. Indeed, the countryside has been urbanized and globalized, markedly over the past two decades. Despite its traditional and with capital largely flowing, at least initially, from Hong Kong, which historical role as the dominant city in the province, Guangzhou's has long been a focal point ofglobal capitalism in Asia (Meyer, 2000). relative importance in the delta has declined. Table 1 shows the rise of The delta has been known for its ability to be innovative and for being Shenzhen and Zhuhai as new cities because of their ability to attract ahead of the rest of China in its ability to attract foreign investment, non-local or foreign investment. Since 1980, the proportion of non­ largely from small firms. Many Hong Kong firms have invested in local capital going to these two cities has exceeded that to Guangzhou, infrastructure and property (Wu, 1997). although Guangzhou has recently narrowed the gap. In terms of the Recent studies have shown that capital investment in the delta relative share of GDP in the PRD, Shenzhen started off in 1980 by from Hong Kong has been characterized by a preference for the accounting for only 1.82 per cent versus Guangzhou's 42.80 per cent. hometowns of the investors. The bamboo network is very much at By 1998, Shenzhen had fully caught up: Guangzhou accounted for work, underlining locality as being of critical importance in linking 22.20 per cent as opposed to Shenzhen's 22.04 per cent (Wong and the identity of a place and the mobility of capital. This explains why, for instance, Dongguan has developed so rapidly since the 1980s. Many Hong Kong investors have originated from that city and it is Table 1 Share ofNon-local Capital in Total Investment in the geographically close to Hong Kong (Lin, 1997, 2002a). PRD Region 1980-1998 (%) With the urbanization of the countryside and the simultaneous growth of new towns and cities, the delta has witnessed a dual-track Area 1980 1985 1990 1991 1993 1994 1998 process of urbanization. On the one hand, the number of designated towns mushroomed from 32 to 392 during the period 1978-1994. Guangzhou 3.04 5.97 8.69 12.97 13.61 23.69 25.28 On the other hand, invisible rural urbanization has been fueled by Shenzhen 16.05 13.78 23.67 22.40 25.19 34.63 30.83 the presence of countless town and village enterprises (TVEs), often Zhuhai 24.88 14.53 23.09 28.66 27.29 34.43 49.95* known as sanlai yibu - *-:fflj firms.
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