Qianhai: How China's 'Build It and They Will Come' Model Failed to Create the Next Hong Kong
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Qianhai, a special economic zone in Shenzhen, has failed to live up to its promises of becoming a global tech and finance hub like Hong Kong. Its office vacancy rate is nearly 30% despite massive investment.
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The area was intended to pilot market reforms and opening up China's economy, but those plans were scrapped as the country has tightened state control under Xi Jinping.
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Without promised reforms, Qianhai relies on low taxes and subsidies to attract businesses, but it struggles to differentiate itself from thousands of other Chinese special zones offering similar incentives.
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Analysts say relying on special zones for growth is no longer viable for China's mature economy. More comprehensive reforms and shift to domestic consumption are needed.
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Qianhai exemplifies the failure of China's "build it and they will come" economic model. Despite huge infrastructure investment, businesses and workers avoid the area due to lack of reforms.