building engines for growth.pdf

CHAPTER 1How Do Special Economic Zonesand Industrial Clusters DriveChina’s Rapid Development?Douglas Zhihua ZengChina’s meteoric economic rise over the past three decades is an unprecedented“growth miracle” in human history. Since the Open Door policyand reforms that began in 1978, China’s gross domestic product (GDP)has been growing at an average annual rate of more than 9 percent, withits global share increasing from 1 percent in 1980 to almost 6.5 percent in2008 (see figure 1.1) and its per capita GDP increasing from US$193 toUS$3,263 (see figure 1.2). Total exports have been growing at an averageannual rate of 13 percent (21.5 percent from 1998 to 2007), with China’sshare of total exports increasing from 1.7 percent in 1980 to 9.5 percentThe author is a senior economist at the World Bank and has worked on countries inthe regions of Africa, East Asia and Pacific, Latin America and the Caribbean, andEurope and Central Asia. He has written intensively on innovation, clusters, privatesector development, competitiveness, skills, and the knowledge economy. Recentpublications (including those co-authored) include Knowledge, Technology, andCluster-Based Growth in Africa; Promoting Enterprise-Led Innovation in China;Innovation for Development and the Role of Government; and Enhancing China’sCompetitiveness through Lifelong Learning, among others. He can be reached atZzeng@worldbank.org.1