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CONFIDENTIAL
Current Hong Kong China Economic Development: Monthly Notes: May 1981
Developments in Shenzhen
1.
NCNA reported on 25th May that up to the end of March this year 600. projects involving foreign participation had been set up or were under construction in Shenzhen Special Economic Zone (the number of such projects had been put at 490 by NCNA at the end of December). Overseas businesses have to date invested a total of HK$2,200 million in the Zone and NCNA said that foreign investment there in 1980 was nearly seven times the 1979 figure (i.e. before the zone was formally established). 408 of the projects are in the industrial sector, 144 in agriculture, 16 in tourism, 14 in commerce and service trades and 18 in transport and real estate. These projects and related construction works have provided employment for 11,000 local people,
said NCNA.
"Free-flow" zone plan
2.
A number of press reports during May referred to plans by the Cuang dong authorities to make Shenzhen a "free-flow' area, pushing the Lowu border checkpoint narta some three miles to Buji. A development of the previously mooted move towards simplified immigration procedures it was suggested that
the present scheme envisages easier access to Shenzhen itself with more thorough controls at Buji for visitors heading beyond the special economic zone. It seems that the main currency to be circulated in Shenzhen will be the Hong Kong.dollar and it has been proposed that one third of the wages of Chinese workers in the area should be paid in that currency.
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. Although the press reports referred to the plans being discussed by a national conference in Peking sometime in June, it is difficult to assess the accuracy or reliability of the details. Certainly, officials in Shenzhen have discussed methods of defining more clearly the zone's boundaries but there is evidence to suggest that this would lead to closer control of access. For example, the Deputy Mayor of Shenzhen, Huang Ximing, said in the course of a conversation with the Political Adviser in January, that there would be carefully controlled entry points along Shenzhen's northern boundary, the busiest being at Buji. He said that the zone would become a "closed area" and that control over the issue of access permits would be "more stringent than in Hong Kong's frontier closed area."
Registration of foreign companies in Guangdong
4.
In an apparent move to keep a closer administrative watch on foreign companies in Guangdong the provincial government has ordered that offices cet up by foreign and overseas Chinese companies (including those from Hong Kong and Macau) must register with the authorities by 11th June.
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