quickly. The provincial and municipal authorities however appear to be doing little to redress this problem at the moment. This is likely to be a severe constraint on the growth of high-tech industries.
2.79 English and other foreign language skills are particularly poor. This is likely to be a restraint on the growth of some service industries.
2.80 The trader mentality, which is common in Guangdong (and part of their cultural history), also restricts the type of risks people are prepared to take. They tend to think short term, prefering quick profits from property developments and being less keen on the long term prospects of, say, new high-tech industries. The unpredictability of Chinese Government policy, of course, accentuates this short term way of thinking.
Rural Industrialisation
2.81 The Consultants would advise that the problems associated with rural industrialisation should also not be underestimated. The province does not have the institutional framework necessary to tackle this problem. Much can be learned from other regions (if only not how to do it). The "southern growth triangle" around Singapore, Johor and Riau is facing similar problems (see Appendix F) - there is a great danger that anarchic developments will lead to social and environmental degradation that cannot easily be reversed and that this will eventually hinder the development process.
Institutional Problems
2.82 Institutional problems are wide-ranging. They include the small nature of many businesses, the retention of most heavy industry in large, unwieldy and inefficient state owned enterprises, the generally lower centrally fixed prices at which state owned industries can still purchase raw materials, the continued restrictions on labour mobility, an uncertain hierarchy of Government authority and unnecessary bureaucratic controls.
2.83 They also include the practical difficulties that Central Government is facing as it tries to enforce a coherent macro-economic policy. Control over the provincial governments is weak and there is now the danger that credit controls to dampen the overheating economy and inflation will lead to a short term reduction in the growth rate.
2.84 Although there is clear recognition that many ofthese problems need tackling, there may be political obstacles to be overcome first.
Lack of a Systematic Legal Framework for Holding Property
2.85 The lack of a systematic legal framework for property deals, the variation in rules between areas, the very large amounts of land held by state organisations, the continued allocation of much land on "Marxist" principles and the fact that most housing is still provided by employers who have
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Ribbon development along major highway - dust from construction sites causing pollution
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