Geography Reference
In-Depth Information
time, the places with lower labor costs and the right mix of
laws attractive to businesses (often weak enviro
place of capitalism came under Chinese communist con-
trol. But the Chinese can ill afford to undercut Hong
Kong's economic dynamism. Hence, Hong Kong has the
status of a Special Administrative District in China, which
gives it a high degree of autonomy from the mainland.
The industrial growth of Singapore also was infl u-
enced by its geographical setting and the changing global
economic division of labor. Strategically located at the
tip of the Malay Peninsula, Singapore is a small island
inhabited by a little over 4 million people, mostly ethnic
Chinese but with Malay and Indian minorities. Fifty years
ago, Singapore was mainly an entrepôt (transshipment
point) for such products as rubber, timber, and oil; today,
the bulk of its foreign revenues come from exports of
manufactured goods and, increasingly, high-technology
products. Singapore is also a center for quaternary indus-
tries, selling services and expertise to a global market.
Rapid economic growth entails risks, and in 1997
risky lending practices and government investment deci-
sions caused Thailand's currency to collapse, followed
by its stock market; banks closed and bankruptcies
abounded. Soon Malaysia and Indonesia were affected,
and by early 1998 one of the Four Tigers, South Korea,
required a massive infusion of dollars (provided by
the International Monetary Fund, a Washington-based
bank) to prevent economic chaos. But the reforms that
allowed the region to overcome these economic troubles
served to strengthen East and Southeast Asia's econo-
mies, and the Four Tigers continue to exert a powerful
regional—and international—economic role.
nmental
laws and pro-free trade laws) have become newly industrial
regions. The new industrial regions emerge as shifts in
politics, laws, capital fl ow, and labor availability o
ccur.
East Asia has become a particularly important new
region of industrialization. Some of the economic policies
we discussed in Chapter 10, such as structural adjustments
and import quotas, help encourage foreign direct invest-
ment, and many draw industrial developers seeking to
take advantage of economic breaks and inexpensive labor.
From Taiwan to Guangdong and from South Korea to
Singapore, the islands, countries, provinces, and cities
fronting the Pacifi c Ocean are caught up in a frenzy of
industrialization that has made the geographic term
Pacifi c
Rim
synonymous with manufacturing.
The Rise of East Asia
Throughout the better part of the twentieth century,
Japan was the only global economic power in East Asia,
and its regional dominance seemed beyond doubt. Other
nodes of manufacturing existed, but these were no threat,
and certainly no match, for Japan's industrial might. The
picture began to change with the rise of the so-called Four
Tigers of East and Southeast Asia: South Korea, Taiwan,
Hong Kong, and Singapore in the 1960s and 1970s.
Benefi ting from the shift of labor-intensive industries to
areas with lower labor costs, government efforts to pro-
tect developing industry, and government investment in
education and training, the tigers emerged as the fi rst
newly industrializing countries (NICs)
. South Korea
developed signifi cant manufacturing districts exporting
products ranging from automobiles and grand pianos to
calculators and computers. One of these districts is cen-
tered on the capital, Seoul (with 10 million inhabitants),
and the two others lie at the southern end of the penin-
sula, anchored by Pusan and Kwangju, respectively.
Taiwan's economic planners promoted high-technology
industries, including personal computers, telecommuni-
cations equipment, precision electronic instruments, and
other high-tech products. More recently the South
Koreans have moved in a similar direction.
Just a trading colony fi ve decades ago, Hong Kong
exploded onto the world economic scene during the 1950s
with textiles and light manufactures. The success of these
industries, based on plentiful, cheap labor, was followed
by growing production of electrical equipment, appli-
ances, and other household products. Hong Kong's situa-
tional advantages contributed enormously to its economic
fortunes. The colony became mainland China's gateway
to the world, a bustling port, fi nancial center, and
break-
of-bulk point
,
where goods are transferred from one
mode of transport to another. In 1997 China took over the
government of Hong Kong from the British, and a show-
The Chinese Juggernaut
Although some industrial growth occurred in China dur-
ing the period of European colonial infl uence, and later
during the Japanese occupation, China's major industrial
expansion occurred during the communist period. When
communist planners took over in 1949, one of their lead-
ing priorities was to develop China's resources and indus-
tries as rapidly as possible.
China is a vast country and has a substantial resource
base. The quality of its coal is good, the quantity enor-
mous, and many of the deposits are near the surface and
easily extracted. China's iron ores are not as productive
and are generally of rather low grade, but new fi nds are
regularly being made.
Until the early 1960s, Soviet planners helped pro-
mote China's industrial development. China was spatially
constrained by the location of raw materials, the develop-
ment that had taken place before the 1949 communist
takeover, the pattern of long-term urbanization in the
country, the existing transport network, and the location
of the population, which was clustered mostly in the east
of the country. Like their Soviet allies, China's rulers
were determined to speed up the industrialization of the
