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firmly controlled after 1997. I think they were more worried about capitalism infecting socialism than the other way round.
(c) Although their attitude was a trifle discouraging, we were given some usefui information in these meetings. The Open Door' policy will continue, and China's transport infrastructure will continue to be upgraded. The new Beijing-Kowloon and Kunming-Nanning-Beihai railways were mentioned as examples of such upgrading. We were also, interestingly, told that the central government would be concentrating on improving the infrastructure in a clutch of cities in central and north China (Shanghai, Tianjin, Chongqing, Wuhan, Harbin, and Shenyang). The south, we were told, was rich enough to fund its own further development, but I think we are also seeing further efforts to balance the immoderate success of Guangdong in the south with developments, like Pudong in Shanghai, further north.
(d) Our reception by the municipal governments of Beijing and Tianjin was rather more cordial. As elsewhere in China, Hong Kong was the largest overseas investor in both cities. Hong Kong has US$ 1 billion (mostly in hotels) invested in Beijing in 462 ventures, (45% of the total number of overseas investments), and US$ 294 million in Tianjin in 301 ventures (45% by value of total overseas investment and 47% of the total number of overseas investments). Municipal officials in both cities were obviously keen for further investment from Hong Kong, and were anxious that Hong Kong remained prosperous after 1997. Both cities claimed to have cheaper land and labour than eisewhere in China (true when compared with Guangdong, not when compared with Shanghai or elsewhere), a plentiful supply of skilled labour (true), and good R&D backup in their universities and other tertiary institutions (true in the case of Beijing, less so for Tianjin). Beijing also pointed out that, from a foreigner's point of view, it was the best city in China to live in (probably true, though Shanghai would run it a close second).
(e) Tianjin in particular did its best to convince us of the advantages it offers overseas investors. The municipal authorities made great play with Tianjin's strategic location as the starting point of the shortest and quickest of the three overland routes from the Pacific to the developing markets of Eastern Europe. If Hong Kong manufacturers were interested in exporting to Eastern Europe, they might consider the overland route instead of shipping their goods the long way round. It was an interesting idea, but we doubted whether the prospect of committing their goods to two of the most inefficient communist infrastructures in the world (Mongolia's and the USSR's, not China's), would appeal to many Hong Kong manufacturers, unless the price was extremely attractive.
(f) Tianjin is obviously determined to compete fiercely with other areas of China for overseas investment, and we were impressed by its Technological and Economic Development Area. Its manager spoke fluent English and told us not only of the area's achievements but also of the site formation problems which had been overcome in its development. The area is run intelligently. The local management office has the power to form, develop, and lease land itself, but may also lease packages to foreign developers for a period or 70 years. A package has recently been sold to an American developer, MGM (not the film company), which will now form, manage, and sell the land to other investors. Such a policy would never have got past the hardliners two years ago, but we were told that it had also been adopted recently in the Hainan and Xiamen SEZs.
(g) Tianjin port, to the east of Tianjin, was also impressive, unlike Ningbo port, which we visited a few months ago. While Ningbo had been developed in the hope that its infrastructure would attract trade ('building the nest to attract the bird'), and was practically deserted, Tianjin was heavily-used and seemed well-managed. It will shortly
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