Drink †Coffee Essay

A. Overview of the Industry The beverage industry in the Philippines has increased its market volume in the recent years as the fruit of gaining popularity and support from majority of the Philippine population. According to Euromonitor. com, after reporting a total volume drop of 2% in the previous year, juice recovered to be among the most vibrant soft drinks categories in 2013. Total juice volume ballooned by 8% supported by the products’ popularity among schoolchildren and the increasing health-consciousness in the country. Manufacturers continue to cash in on the local perception that juice is healthier than other popular soft drinks products like carbonates. It should be noted that, in 2013, the Department of Education banned the selling of carbonated drinks in school premises. Juice benefits from this development as it is among the beverages geared at children. B. Market Profile The target market of Zest-O in general are the kids and moms. These consumers can afford consumption for such beverages and therefore, better chances of high sales volume. Simultaneously, they also have the tendency to be more aware of health and wellness needs basically due to unlimited access to the diverse forms of media for advertising and promotions as carriers of information. As mentioned earlier, the Philippines, having a warm climate, is not such a comfortable place to be in especially during the peak of heat waves. For the local consumer, it’s all natural to look for a thirst-quenching treat in compensation for the discomforts of the heat. In line with this, demand for refreshing beverages significantly boosts during the months of March, April and May, while the rest of the year, the demand lessens partially yet remains constant. C. Market Size Based on the preliminary results of the 2012 Census of Philippine and Industry (CPBI) conducted nationwide, the Philippines had a total of 173,900 Value of Production of Key Manufacturing Enterprises by Beverage Industry for the year 2012. Table 1 shows that Beverage Industry for the year 2009 garnered the lowest number of value of production of key manufacturing enterprises at 123,300 (71.9%) followed by the year 2010 with 141,700 value of production of key manufacturing enterprises. Table 1 Link: http://www. nscb. gov. ph/secstat/d_estab. asp Industry cost structure A value chain is a model used to disaggregate a firm into its strategically relevant value generating activities, in order to evaluate each activity’s contribution to the firm’s performance (Terms V 2006). Through the analysis of this model we can gain insight as to how a firm creates their competitive advantage and shareholder value. The value chain of the nonalcoholic beverage industry contains five main activities. These include inbound logistics (suppliers), operations, outbound logistics (buyers/ customers), marketing and sales, and service. Inbound Logistics (Suppliers) Zest-O’s suppliers provide them with materials such as ingredients, packaging and machinery. In order to ensure that these materials are in satisfactory condition, Zest-O has put certain standards in place which these suppliers must adhere to (The Supplier Guiding Principles). These include: compliance with laws and standards, laws and regulations, freedom of association and collective bargaining, forced and child labor, abuse of labor, discrimination, wages and benefits, work hours and overtime, health and safety, environment, and demonstration of compliance (Zest-O 2006). From time to time, Zest-O uses third parties to assess their suppliers by having interviews with employers and contract workers. If a supplier has issues about the supplier guiding principles, they are usually given a certain amount of time to take corrective measures; if not, Zest-O has the right to terminate their contract with these suppliers. Operations Zest-O’s core operations consist of Company-owned concentrate and syrup production. According to their website, some of the main environmental impacts of their business occur further along the value chain through system’s bottling operations, distribution networks, and sales and marketing activities. Management of these operations across the business value chain tends to be more challenging outside of the core operations. According to Zest-O, they continue to address this by working with their partners to reduce the effects at every level of the manufacturing process by enlarging their comprehension of the complete environmental impact of their business through the entire lifecycle of their products from ingredient procurement to production, delivery, sales and marketing, and post-consumer recycling. Outbound Logistics (Buyers/ Customers). The activities required to get finished products to customers include warehousing, order fulfillment, transportation, and distribution management. Zesto products are sometimes transported by four-legged power. Across much of provinces, bottlers deliver to thousands of family-run kiosks and home-based stores. Marketing and Sales The Company pioneered the first-ready-to-drink juice drink in flexible foil pouch (Doy Pack System). With its flair for innovation, Zest-O juice drinks won the consumers’ patronage and wide acceptance. Over the past 25 years, Zest-O has earned itself a place in the Filipino culture. Zest-O Corporation has posted enormous growth over the years. With total assets of only Php 10M when it started, it continued to grow reaching annual gross sales of 280M in 1987 after 6 ? years of operation. As the company continued to venture into different products, sales continued to MULTIPLY reaching a total annual gross sales of Php 2. 6 B for the year 2004 with a total asset of 450 M. Service Activities that maintain and enhance a product’s value include customer support, repair services, installation and training. Zest-o’s customers range from large international retailers to smaller independent businesses and vendors. As a result, they provide services tailored to meet their customer’s needs. Market Trends Zest-O’s target markets are increasingly growing towards recognizing the difference between poor quality brews and those of high quality. This development is an important trend for the company as it represent its target market. Zest-O now are having an increasing number of people who appreciate the traditional brews whilst living in the urban areas. With this in mind Zest-O intend to ensure that our packaging is respectable and attractive. Today’s extremely stressful work environment dictates that individuals consume healthy drinks especially in the summer season, this presents an opportunity that Zest-O may exploit, marketing the health aspect of its beverages. Market Growth Juice will continue to capitalize on its health positioning to sustain growth in the forecast period. The total volume CAGR from 2013 to 2018 in this category is 2% while constant value sales will reach Ps45. 6 billion in 2018. The demand for juice is supported by the health-consciousness of consumers in the Philippines, and will be stimulated further by the expected influx of new product developments by manufacturers in 2013-2018. Recognizing consumers’ increasing demand for products, which are positioned to improve the wellbeing of patrons, industry players will largely invest in the development of health and wellness juice products. Fortification will remain a key strategy employed by companies to differentiate themselves from competition and target specific consumers. Source: http://www. euromonitor. com/juice-in-the-philippines/report Market Needs Drinks in the Philippines are not only a necessary complement to meals, but also help beat the tropical heat. As with their food, Filipinos often incorporate local produce into beverages to create tasty and refreshing concoctions. A few examples include blended mango shakes, coconut juice and pandan leaf iced tea. Filipinos also enjoy the coconut-infused hard liquor known as lambing and gin cocktails mixed with pineapple juice or citrus fruit juice. Zest-o will set out to provide good quality products that will help instill a jovial environment. Zest-o intends to provide the customer with more than a drink to quench one’s thirst. The company intend to provide a quality beverage that not only quenches one’s thirst but enables one to enjoy themselves and be proud of it. The quality of raw materials and assembly technology evident in their products will serve to enhance the appearance of the customers, in turn adding to their status.

Introducing government in america Essay

A. Defining Democracy 1. Democracy is a means of selecting policymakers and of organizing government so that policy reflects citizens’ preferences. B. Traditional Democratic Theory 1. Equality in voting 2. Effective participation 3. Enlightened understanding 4. Citizen control of the agenda 5. Inclusion 6. Democracies must practice majority rule and preserve minority rights. 7. The relationship between the few leaders and the many followers is one of representation. C. Three Contemporary Theories of American Democracy 1. Pluralist theory states that groups with shared interests influence public policy by pressing their concerns through organized efforts. 2. Elite and class theory contends that societies are divided along class lines, and that an upper-class elite pulls the strings of government. 3. Hyperpluralism contends that many groups are so strong that government is unable to act. D. Challenges to Democracy 1. Increased Technical Expertise 2. Limited Participation in Government 3. Escalating Campaign Costs 4. Diverse Political Interests (policy gridlock) E. American Political Culture and Democracy 1. Political culture consists of the overall set of values widely shared within a society. 2. Liberty 3. Egalitarianism 4. Individualism 5. Laissez-faire 6. Populism F. A Culture War? (Is America polarized into rival political camps with different political cultures?) G. Preview Questions about Democracy VI. The Scope of Government in America (pp. 23–26) A. How Active Is American Government? B. Preview Questions about the Scope of Government VII. Summary (p. 26) LEARNING OBJECTIVES After studying Chapter 1, you should be able to: 1. Describe what government is and what governments do. 2. Understand how politics is the struggle over â€Å"who gets what, when, and how.† 3. Identify the important features of the policymaking system and explain how public policies are the choices that government makes—and declines to make—in response to political issues. 4. Understand the nature of democratic government and traditional democratic theory, and the key questions concerning democracy. 5. Distinguish among the three contemporary theories of American democracy and politics (pluralist, elite and class, and hyperpluralist) and identify some of their strengths and weaknesses. 6. Understand the nature of American political culture and identify the elements of the American creed. 7. Understand the nature of the scope of government in America and the key questions concerning the scope of government. The following exercises will help you meet these objectives: Objective 1: Describe what government is and what governments do. 1. Define the term â€Å"government.† The institutions that make authoritative decisions for any given society. 2. What are the two fundamental questions about governing that serve as themes throughout the textbook? 1. How should we govern? 2. What should government do? 3. List the five functions that all national governments perform. 1. Maintain a national defense 2. Provide public services 3. Preserve order 4. Socialize the young 5. Collect taxes Objective 2: Understand that politics is the struggle over â€Å"who gets what, when, and how.† 1. Define the term â€Å"politics.† Determines whom we select as our governmental leaders and what policies these leaders pursue. 2. Give examples of the â€Å"who,† â€Å"what,† â€Å"when,† and â€Å"how† of politics. 1. Who: Voters, candidates, groups, and parties 2. What: New taxes, medical care for the elderly 3. When: When people speak up 4. How: Voting, supporting, compromising, lobbying Objective 3: Identify the important features of the policy system and explain how public policies are the choices that government makes, and declines to make, in response to political issues. 1. Draw a diagram of how a policy system works. Political issues get on policy agenda Policymakers make policy Policies affect people People Linkage institutions Policy Agenda Policymaking institutions Policy People 2. List four key linkage institutions in a democratic society. 1. Parties 2. Interest groups 3. Media 4. Elections 3. Define the term â€Å"policy agenda.† The issues that attract the serious attention of public officials and other people actually involved in politics at in given point in time. 4. How does a government’s policy agenda change? Responds more to societal failures than successes. For example, when jobs are scarce and business productivity is falling, economic problems occupy a high position in the agenda. 5. List the four major policymaking institutions in the United States. 1. Congress 2. The Presidency 3. The Courts 4. Bureaucracies 6. Define the term â€Å"policy impacts.† The effects a policy has on people and problems. Impacts are analyzed to see how well a policy has met its goal and at what cost. Objective 4: Understand the nature of democratic government, traditional democratic theory, and the key questions concerning democracy. 1. Define the term â€Å"democracy† as used in this text. A system of selecting policymakers and of organizing government so that policy represents and responds to the public’s preferences. 2. List the five cornerstones of an ideal democracy. 1. Equality in voting 2. Effective participation 3. Enlightened understanding 4. Citizen control of the agenda 5. Inclusion 3. Explain the principles of majority rule and minority rights. When choosing among alternatives, the will of over half the voters should be followed, but restraints protecting the minority’s rights. Objective 5: Distinguish among the three contemporary theories of American democracy and politics (pluralist, elite and class, and hyperpluralist) and identify some of their strengths and weaknesses. 1. Complete the following table comparing pluralist, elite and class, and hyperpluralist theories according to who holds the power and how policy is made. Theory| Who Holds Power| How Policy is Made| Pluralist| Groups with shared interests| Pressing their concernsthrough organized efforts| Elite and Class| Upper -class| They can afford to finance election campaigns and control key institutions| Hyperpluralist| Groups| Groups are so strong that government is weakened| 2. List the major challenges facing American democracy. 1. Increased Technical Expertise 2. Limited Participation in Government 3. Escalating Campaign Costs 4. Diverse Political Interests Objective 6: Understand the nature of American political culture and identify the elements of the American creed. 1. What is ‘political culture’ and why is it crucial to understanding American government? An overall set of values widely shared within a society. It is crucial to understanding American government because Americans are so diverse in terms of ancestries, religions, and heritages. A set of shared beliefs and values unites Americans. 2. List and give an example of the five elements of the American creed according to Seymour Martin Lipset. 1. Liberty 2. Egalitarianism 3. Individualism 4. Laissez – faire 5. Populism 3. List three ways in which America might be experiencing a crisis of cultural values. 1. A loss over time of traditional values, such as the importance of religion and family life 2. An unfavorable comparison with the citizens of other countries in terms of values such as patriotism or support for moral principles 3. The division of society into opposed groups with irreconcilable moral differences Objective 7: Understand the nature of the scope of government in America and the key questions concerning the scope of government. 1. Make a list of items that illustrate the scope of American government. Owns 1/3 of the land I the U.S., owns and operates over 400,000 nonmilitary vehicles, employs over 2.2 million people, etc 2. What is gross domestic product and how does the term illustrate the scope of American government? The sum total of the value of all the goods and services produced in a nation. Gross domestic product illustrates the scope of American government because it not only spends large sums of money but also employs large numbers of people. About 18 million Americans work for our government. KEY TERMS Identify and describe: Government – The institutions that make authoritative decisions for any given society public goods – Services the government provides that can be shared by everyone and cannot be denied to anyone politics – Determines whom we select as our governmental leaders and what policies these leaders pursue political participation – The ways in which people get involved in politics single-issue groups – Groups so concerned with one issue that members cast their votes on the basis of that issue only, ignoring the politicians stand on everything else policymaking system – Reveals the way our government responds to the priorities of its people linkage institutions – The political channels through which people’s concerns become political issues on the policy agenda. In the US, linkage institutions include elections, political parties, interest groups, and the media. policy agenda – The issues that attract the serious attention of publ ic officials and other people actively involved in politics at any given time political issue – The result of people disagreeing about a problem or about the public policy needed to fix it policymaking institutions – Congress, the presidency, and the courts public policy – Every decision the government makes policy impacts – The effects that a policy has on people and on society’s problems democracy – A means of selecting policymakers and organizing government so that policy reflects citizen’s preferences majority rule – In choosing among alternatives, the will of over half the voters should be followed minority rights – Rights the majority cannot infringe on representation – The relationship between the few leaders and the many citizens pluralist theory – States that groups with shared interests influence public policy by pressing their concerns through organized efforts elite and class theory – Contends that our society, like all societies, is divided along class lines and that an upper-class elite pulls the strings of government hyperpluralism – Groups are so strong that government is weakened, as influence of many groups cripples government’s ability to make policy policy gridlock – Each policy coalition finds its way blocked by others political culture – The overall set of values widely shared within American society Gross domestic product – The total value of all goods and services produced annually by the United States Name that term: 1. Something in which any member of society can share without diminishing the supply to any other member of society. ____Public Goods__________ 2. It consists of subjects and problems getting the attention of government officials and their associates. _________________________ 3. This is a choice that government makes in response to an issue on its agenda. ____Policy Agenda_________ 4. This arises when people disagree about a problem or about public policy choices made to combat a problem. _____Political Issue________ 5. Political parties, elections, and interest groups are the main ones in the United States. _____Linkage Institutions___ 6. The effects a policy has on people and on society’s problems. _____Policy Impacts_______ 7. The most fundamental aspect of democratic theory. _____Majority Rule_______ 8. According to this theory of American government, many groups are so strong and numerous that the government is unable to act. _____Hyperpluralism______ 9. This problem is magnified when voters choose a president from one party and congressional majorities from the other party. ____Policy Gridlock_______ 10. A key factor that holds American democracy together. ____Political Culture________ 11. The total value of all goods and services produced annually by the United States. __Gross Domestic Product____ MULTIPLE CHOICE QUESTIONS Circle the correct answer: 1. Which of the following statements is TRUE? a. There is no relationship between political knowledge and age. b. In the mid-1960s, there was virtually no relationship between political knowledge and age; now, in the early twenty-first century, political knowledge increases with age. c. In the mid-1960s, there was virtually no relationship between political knowledge and age; now, in the early twenty-first century, political knowledge decreases with age. d. Today, in the early twenty-first century, there is virtually no relationship between political knowledge and age; in the mid-1960s, political knowledge increased with age. e. Today, in the early twenty-first century, there is virtually no relationship between political knowledge and age; in the mid-1960s, political knowledge decreased with age. 2. Political scientists argue that higher levels of political knowledge a. foster tolerance. b. foster intolerance. c. promote partisanship. d. promote bipartisanship. e. increase wealth. 3. Despite their differences, all governments a. provide public services. b. maintain a national defense. c. collect taxes. d. All of the above e. C only 4. Which of the following is an example of a public good? a. Libraries b. Parks c. College education d. All of the above e. Both a and b 5. Single-issue groups a. aid effective policymaking for the public interest. b. are concerned with a wide range of problems. c. have very little influence on voters or politicians. d. tend to have a narrow interest and to dislike compromise. e. view politics as a vocation, rather than as an avocation. 6. Which of the following is NOT a component of the policymaking system? a. People b. Linkage institutions c. Policy agenda d. Criminal justice institutions e. Policymaking institutions 7. Which of the following is TRUE of the policymaking system? a. Linkage institutions transmit people’s interests to government. b. Media investigate social problems and inform people about them. c. Elections enable Americans to make their opinions heard by choosing their public officials. d. People, linkage institutions, media, and elections all help to shape the policy agenda? e. All of the above 8. In a democratic society, parties, elections, interest groups, and the media are all examples of ____ between the preferences of citizens and the government’s policy agenda. a. cross-pollination b. inputs and outputs c. ideological bridges d. obstacles e. linkage institutions 9. Karl Marx and Freidrich Engels published a. The Communist Manifesto b. A Theory of Democracy c. The Federalist Papers d. Poor Richard’s Almanac e. War and Peace 10. Which of the following is NOT a type of public policy? a. Congressional statute b. Regulation c. Court decision d. Budgetary choices e. Mandate 11. The principle of â€Å"one person, one vote,† is an expression of the principle of a. equality in voting. b. effective participation. c. enlightened understanding. d. inclusion. e. citizen control of the agenda. 12. The principle of traditional democracy theory guaranteeing rights to those who do not belong to majorities and allows that they might join majorities through persuasion and reasoned argument is called the principle of a. majority rule. b. minority rights. c. representation. d. pluralism. e. enlightened understanding. 13. Pluralists a. believe that the public interest will prevail through bargaining and compromise. b. depend on fragmented, decentralized, and dispersed power in the policy process. c. oppose the principle of majority rule. d. compete through a system of â€Å"minority rule† for influence. e. All of the above 14. Who referred to the U.S. as a â€Å"nation of joiners†? a. Thomas Jefferson b. Alexis de Tocqueville c. Robert Putnam d. Ronald Reagan e. George H. W. Bush 15. Increased technical expertise poses a potential challenge to democracy because a. it is difficult to have an informed â€Å"nontechnical† public debate on technical issues. b. it goes against the tenets of pluralist political theory. c. it violates the notion of one man, one vote. d. elected officials find it hard to understand technical experts. e. interest groups have a difficult time securing technical expertise. 16. A condition that occurs when no coalition is strong enough to form a majority and establish policy is a. PAC. b. policy gridlock. c. policy failure. d. policy impact. e. hyperpluralist policy. 17. The overall set of values widely shared within a society is called the society’s a. political culture. b. public opinion. c. media influence. d. linkage institutions. e. popular culture. 18. America’s bountiful frontier provides a partial explanation for which element of the American creed? a. Egalitarianism b. Populism c. Individualism d. Opportunism e. Liberty 19. Which of the following is NOT a possible way that Americans may be experiencing a crisis of culture values, according to Wayne Baker? a. A loss of traditional values, such as religion and family life b. An unfavorable comparison with citizens of other countries in terms of patriotism and/or support for moral principles c. The division of society into opposed groups with irreconcilable moral differences d. A decline in citizens’ commitment to equal opportunity e. None of the above 20. Which of the following statements is TRUE? a. When expenditures grow, tax revenues must grow to pay the additional costs. b. When taxes do not grow as fast as spending, a budget deficit results. c. In 2009, the federal deficit was more than $400 billion. d. The national debt is more than $9 trillion. e. All of the above TRUE FALSE QUESTIONS Circle the correct answer: 1. The voter turnout rate among young Americans is consistently higher than among older Americans. T / F 2. Emergent communication technologies and the proliferation of television channels make it easier to avoid information about politics. T / F 3. All governments protect national sovereignty, frequently by maintaining a national defense and armed forces. T / F 4. The daily recitation of the Pledge of Allegiance in public schools is a tool of political socialization used to instill national values among the young. T / F 5. The courts are an example of a linkage institution. T / F 6. The policy agenda responds more to societal failures than it responds to societal successes. T / F 7. Most people around the world believe that democracy is the best form of government. T / F 8. Over one-third of the nation’s wealth is held by just 1 percent of the population. T / F 9. The tax burden on Americans is small compared to other democratic nations. T / F 10. Lincoln’s famous phrase, â€Å"government of the people, for the people, and by the people,† is a classic expression of laissez-faire. T / F

Sez in China

Especial economic zone: A  Special Economic Zone  (SEZ) is a geographical region that has economic and other laws that are more free-market-oriented than a country's typical or national laws. â€Å"Nationwide† laws may be suspended inside a special economic zone. The category SEZ covers, including  free trade zones  (FTZ), export processing Zones (EPZ), free Zones (FZ),  industrial parks  or industrial estates (IE),  free ports,  free economic zones,  urban enterprise zones  and others.Usually the goal of a structure is to increase  foreign direct investment  by foreign investors, typically an  international business  or a  multinational corporation  (MNC), development of  infrastructureand to increase the employment. Currently, the most prominent SEZs in the country are  Shenzhen,  Xiamen,  Shantou, and  Zhuhai. It is notable that Shenzhen, Shantou, and Zhuhai are all in  Guangdong province, and all are on the southern coast of Chin a where sea is very accessible for transportation of goods.An analysis of the performance of these SEZs in China versus those in India in liberalizing the Chinese and Indian economies and their impact on economic growth was conducted by  Leong (2012). This paper investigates the role of special economic zones (SEZs) . The policy change to a more liberalized economy is identified using SEZ variables as instrumental variables. The results indicate that export and FDI growth have positive and statistically significant effects on economic growth in these countries. The presence of SEZs increases regional growth but increasing the number of SEZs has negligible effect on growth.The key to faster economic growth appears to be a greater pace of liberalization. Special economic zones of the people’s republic of china Special Economic Zones of the People's Republic of China  (SEZs) are  special economic zones  located in  mainland China. The  government of the People's Repu blic of China  gives SEZs special (more  free market-oriented) economic policies and flexible governmental measures. This allows SEZs to utilize an economic management system that is especially conducive to doing business that does not exist in the rest of mainland China.History Since the late 1970s, and especially since the 3rd Plenary Session of the 11th CPC Central Committee in 1978, the PRC government has decided toreform the national economic setup. The basic state policy has focused on the formulation and implementation of overall reform and opening to the outside world. During the 1980s, the PRC passed several stages, ranging from the establishment of special economic zones and open coastal cities and areas, and designating open inland and coastal economic and technology development zones.Since 1980, the PRC has established special economic zones in  Shenzhen,  Zhuhai  and  Shantou  in  Guangdong Province  and  Xiamen  in  Fujian Province, and designat ed the entire province ofHainan  a special economic zone. In August 1980, the  National People's Congress  (NPC) passed â€Å"Regulations for The Special Economy Zone of  Guangdong  Province† and officially designated a portion of  Shenzhen  as the Shenzhen Special Economy Zone (SSEZ).In 1984, the PRC further opened 14 coastal cities to overseas investment:  Dalian,  Qinhuangdao,  Tianjin,  Yantai,  Qingdao,  Lianyungang,  Nantong,  Shanghai,  Ningbo,  Wenzhou,  Fuzhou,Guangzhou,  Zhanjiang  and  Beihai. Since 1988, mainland China's opening to the outside world has been extended to its border areas, areas along the Yangtze River and inland areas. First, the state decided to turn Hainan Island into mainland China's biggest special economic zone (approved by the 1st session of the 7th NPC in 1988) and to enlarge the other four special economic zones.Shortly afterwards, the  State Council  expanded the open coastal areas, extending i nto an open coastal belt the open economic zones of the  Yangtze River Delta,  Pearl River Delta, Xiamen-Zhangzhou-Quanzhou  Triangle in south Fujian,  Shandong Peninsula,  Liaodong Peninsula  (Liaoning  Province),  Hebei  and  Guangxi. In June 1990 the PRC government opened the  Pudong  New Area in Shanghai to overseas investment, and additional cities along the Yangtze River valley, with Shanghai's Pudong New Area as its â€Å"dragon head. Since 1992, the  State Council  has opened a number of border cities, and in addition, opened all the capital cities of inland provinces and autonomous regions. In addition, 15 free trade zones, 32 state-level economic and technological development zones, and 53 new and  high-tech  industrial development zones have been established in large and medium-sized cities. As these open areas adopt different preferential policies, they play the dual roles of â€Å"windows† in developing the foreign-oriented econom y, generating foreign exchanges through exporting products and importing advanced echnologies and of â€Å"radiators† in accelerating inland economic development. Primarily geared to exporting processed goods, the five special economic zones are foreign-oriented areas which integrate science and industry with trade, and benefit from preferential policies and special managerial systems. In 1999, Shenzhen's new-and high-tech industry became one with best prospects, and the output value of new-and high-tech products reached 81. 98 billion yuan, making up 40. 5% of the city's total industrial output value.Since its founding in 1992, the Shanghai Pudong New Zone has made great progress in both absorbing foreign capital and accelerating the economic development of the Yangtze River valley. The state has extended special preferential policies to the Pudong New Zone that are not yet enjoyed by the special economic zones. For instance, in addition to the preferential policies of reduc ing or eliminating Customs duties and income tax common to the economic and technological development zones, the state also permits the zone to allow foreign business people to open financial institutions and run tertiary industries.In addition, the state has given Shanghai permission to set up a  stock exchange, expand its examination and approval authority over investments and allow foreign-funded banks to engage in  RMB  business. In 1999, the  GDP  of the Pudong New Zone came to 80 billion yuan, and the total industrial output value, 145 billion yuan. In May 2010, the PRC designated the city of  Kashgar  in  Xinjiang  a SEZ. Kashgar's annual growth rate was 17. 4 percent from 2009, and Kashgar's designation has since increased  tourism  andreal estate prices  in the city.Kashgar is close to China's border with the independent states of former  Soviet Central Asia  and the SEZ seeks to capitalize on international trade links between China and those sta tes. List of SEZs As part of its economic reforms and policy of opening to the world, between 1980 and 1984 China established  special economic zones  (SEZs) in  Shantou,  Shenzhen, and  Zhuhai  in  Guangdong  Province and  Xiamen  in  Fujian  Province and designated the entire island province of  Hainan  a special economic zone.In 1984 China opened 14 other coastal cities to overseas investment (listed north to south):  Dalian,  Qinhuangdao,  Tianjin,  Yantai,Qingdao,  Lianyungang,  Nantong,  S hanghai,  Ningbo,  Wenzhou,  Fuzhou,  Guangzhou,  Zhanjiang, and  Beihai. Then, beginning in 1985, the central government expanded the coastal area by establishing the following open economic zones (listed north to south):  Liaodong Peninsula,  Hebei  Province (which surrounds  Beijing  and  Tianjin),  Shandong  Peninsula,  Yangtze River Delta,Xiamen-Zhangzhou-Quanzhou  Triangle in southern Fujian Province,  Pearl Ri ver Delta, and  Guangxi.In 1990 the Chinese government decided to open the  Pudong  New Zone in  Shanghai  to overseas investment, as well as more cities in the Yangzi River Valley. Since 1992 the  State Council  has opened a number of border cities and all the capital cities of inland provinces and autonomous regions. In addition, 15 free-trade zones, 32 state-level economic and technological development zones, and 53 new and high-tech industrial development zones have been established in large and medium-sized cities. As a result, a multilevel diversified pattern of opening and integrating coastal areas with river, border, and inland areas has been formed in China.Type| City| Province| Special Economic Zone, City| Shenzhen| Guangdong| | Zhuhai| Guangdong| | Shantou| Guangdong| | Xiamen| Fujian| | Kashgar| Xinjiang| Special Economic Zone, Province| No city| Hainan| Coastal Development Areas| Dalian| Liaoning| | Qinhuangdao| Hebei| | Tianjin| Tianjin| | Yantai| Shandon g| | Qingdao| Shandong| | Lianyungang| Jiangsu| | Nantong| Jiangsu| | Shanghai| Shanghai| | Ningbo| Zhejiang| | Wenzhou| Zhejiang| | Fuzhou| Fujian| | Guangzhou| Guangdong| | Zhanjiang| Guangdong| | Beihai| Guangxi| ————————————————- Hainan Special Economic ZoneHainan became a special economic zone in 1988 after the other 4 zones had already established themselves as being successful and scalable. For current foreign investment regulations for the Hainan zone please see  Hainan Special Economic Zone, Foreign Investment Regulations ————————————————- Economic policies of SEZs 1. Special tax incentives for foreign investments in the SEZs. 2. Greater independence on international trade activities. 3. Economic characteristics are represented as â€Å"4 principlesâ € : 1. Construction primarily relies on attracting and utilizing foreign capital 2.Primary economic forms are Sino-foreign  joint ventures  and partnerships as well as wholly foreign-owned enterprises 3. Products are primarily export-oriented 4. Economic activities are primarily driven by market forces SEZs are listed separately in the national planning (including financial planning) and have province-level authority on economic administration. SEZs local congress and government have legislation authority. Leong (2012) investigates the role of special economic zones (SEZs) in liberalizing the Chinese and Indian economies and their impact on economic growth.The policy change to a more liberalized economy is identified using SEZ variables as instrumental variables. The results indicate that export and FDI growth have positive and statistically significant effects on economic growth in these countries. The presence of SEZs increases regional growth but increasing the number of S EZs has negligible effect on growth. The key to faster economic growth appears to be a greater pace of liberalization. China's Special Economic Zones Xu Dixin The Chinese Government has set up four special economic zones.They are located in the cities of Shenzhen, Zhuhai and Shantou of Guangdong Province and the city of Xiamen of Fujian Province . Politically, the special economic zones are based on assurance of China's state sovereignty and governing authority is entirely in China's hands. Economically, they are essentially based on state capitalism. APPROXIMATELY 300 special economic zones have been established in about 75 countries and regions in the world today (some are called free trading zones, some processing-exporting zones and some tax-free trading zones).Practices vary between countries. Special economic zones are set up when a country delimits a special area where, through exemption of customs duty, it formulates various preferential conditions and provides public facili ties so as to attract foreign investors to set up factories whose finished products are mainly for export. Insofar as capitalist social systems are concerned, few problems arise for those countries which set up special economic zones because the characteristics of such zones are essentially compatible with the development of capitalism.Some people wonder why China, a socialist country, has set up special zones which permit the manoeuvre of foreign capital. They ask: Concessions were eliminated a long time ago, why are a few areas with foreign investment being operated in the manner of concessions? They also want to know whether the four special economic zones represent a revival of the former concessions. Although important, such concerns are oversimplified and superficial. The situation can be best understood within context of the past and the nation's present state of development.At the end of the 19th century, foreign capital poured into China. This was a result of invasion by im perialist powers which used â€Å"gunboat diplomacy† to impose unequal treaties on China and infringed upon its state sovereignty. The foreign capital presently being invested in China is not based on â€Å"unequal treaties,† but on the assurance of China's state sovereignty. The special economic zones do not represent the revival of former concessions because authority over them is entirely in China's hands.Be they joint ventures with Chinese and foreign investments set up in the special zones or enterprises run exclusively by foreign or overseas Chinese capital, they must observe the Chinese Government's decrees and regulations, pay business and income taxes according to provisions and abide by China's labour laws. Although they represent a minor change in state economic policy, the special economic zones are not in basic conflict with China's socialist economic system. The economy in the special zones encompasses the socialist state economy, the collective economy a nd the individual economy, but state capitalism has the lion's share.Processing materials for foreign countries, compensatory trade, co-operative enterprises and joint ventures are all state capitalist economic activities. Strictly speaking, the enterprises run by foreign or overseas Chinese capital constitute a kind of capitalist economy, but the activities of such enterprises are subject to control and regulation by the governments of the special zones. As a result, they are special kinds of capitalist enterprises. Lenin clearly said: â€Å"State capitalism is capitalism which we shall be able to restrict, the limits of which we shall be able to fix. This provides us with a theoretical explanation of the nature of the enterprises financed individually in the special zones. Some people worry that the capitalists will exploit the surplus value of the labourers. It should be admitted that some exploitation does exist in the joint ventures or individually financed enterprises in the special zones. According to China's regulations, joint ventures or enterprises individually financed by foreign capital or overseas Chinese capital can remit their share of profits abroad after they have paid their income tax according to relevant provisions and with the approval of the authorities concerned.The profits remitted abroad and the profits retained for reinvestment in the special zones obviously represent the surplus value of the labourers. But allowing foreign or overseas Chinese capital to gain profits is, in a sense, a policy of redemption (that is, a policy of gradually nationalizing the means of production of the exploiting classes at a certain price). Shortly after the founding of the People's Republic, the government adopted a redemption policy towards the national bourgeoisie in order to win its co-operation.Now we are employing a redemption policy to win the co-operation of foreign and overseas Chinese capital. This is necessary for the development of the econom ies of the special zones. One of the characteristics of special zone economies is the fact that they open the door to foreign countries. Take Shenzhen and Zhuhai for example, their economic ties with Xianggang (Hongkong) and Aomen (Macao) are much closer than with the interior. This situation may result in the close relationship and mutual-effect between the role of regulating production according to market demands and the market fluctuations of Xianggang and Aomen.Within the special zones, it cannot be said that the regulation of production by state planning does not exist or does not function. However, if regulation of production by planning is made to cover too large an area, if it becomes the main body of the economy of the special zones, then it will be disadvantageous to absorbing foreign capital and developing the economies of the special zones. Newly built harbour in the Shekou industrial area managed by a Xianggang (Hongkong) company. Special Zones' FunctionsBecause the spe cial economic zones in Guangdong and Fujian Provinces have only been established for a short period of time, their role has not been brought into full play. The following points address the concerns most frequently expressed regarding their operation: They serve as bridges for introducing foreign capital, advanced technology and equipment and as classrooms for training personnel capable of mastering advanced technology. Both in the process of production and circulation, and in the joint ventures with Chinese and foreign investments in the special zones, we can learn the latest techniques and scientific methods of management.To develop the national economy and expedite China's enterprise production and management, it is imperative to promote competition between regions, between trades and with-in a certain trade. In the development of the economies of the special zones -and during their competition with Xianggang and Aomen – it is possible to win in the competition by learning how to make comparisons regarding the regulation of production according to market demands. improve the quality of goods, develop new products and reduce production costs. It is possible to absorb considerable amounts. of foreign exchange.It is also possible to transfer part of the foreign capital, technology and equipment through the special zones to other regions concerned and set up new enterprises there. The country's special zones can serve as experimental units in economic structural reform and as schools for learning the law of value and the regulation of production according to market demands. By developing the economies of the special zones, it is possible to employ many young people waiting for jobs. Some people wonder why it is necessary, more than 30 years since the founding of the People's Republic, to set up special economic zones.They also wonder whether the special zones signify that China is seeking help from capitalist countries. Such concerns are understandable, but unwarranted. Since its establishment, New China has scored brilliant achievements in many fields of work, including economic construction. But it has also traversed a tortuous path. Compared with the world's most advanced nations. China's level of production is still rather low. Its funds and technology are incompatible with the requirements of the modernization drive.Furthermore,† while implementing its policy of self-reliance in economic construction, China does not exclude co-operation with capitalism. Facts will prove that through developing the economies of the special zones, we will be able to make use of foreign and overseas Chinese capital, as well as state capitalism, to develop China's socialist economy. Economic construction in the special zones will possibly become a special form of supplement to the development of China's socialist economy. The total economies of the special zones will only constitute a very small portion of the national economy.Although the s ocialist economy will continue to dominate, the role of the special zones must not be overlooked. Japanese technician passing on technical know-how to a Chinese worker at a joint Sino-Japanese TV company. Policies and Measures 1. The development of the special economic zones requires emphasis on the word â€Å"special. † For instance, in opening the door to foreign countries, it is necessary to simplify procedures for entry and exit and make things easy for visitors. In tax rate, it is essential to give preferential treatment to imported goods in customs duties. Tax exemptions for some goods are needed.A portion of the profits gained by foreign financed enterprises is allowed to be remitted abroad. 2. The essence of developing the special economic zones lies in the import of foreign capital; making foreign capital serve China's socialist modernization drive. Given this, the lives of the people residing in the special zones are bound to change. Capitalist ideology is bound to increase. This will require us to devote special attention to the ideological education of people in the special zones. Of course, education and training in science and technology should not be neglected, either. 3.The currency used in the special economic zones is mainly Renminbi (people's currency), the use of foreign currencies is limited to designated areas. Renminbi represents the currency of the People's Republic of China, but in view of the characteristics of special economic zones, it may prove necessary to issue different currency for them. This is a very complicated problem which calls for further study. 4. It would be impossible for the special zones to develop without the support of China's interior regions. Only when they operate in cooperation with the interior can the special zones gain necessary materials.Of course, such cooperation is based on mutual benefit. And it can be successful only when the special zones produce commodities needed by the interior. This co-ope ration must be carried out in a planned way. China’s capital controls The more special economic zone The landscape of capital-account liberalisation Jul 7th 2012 |  QIANHAI  | from the print edition * Where there’s muck ELSEWHERE in the developing world, towns grow before the infrastructure is quite ready to support them. Things are different in Shenzhen, China’s original Special Economic Zone (SEZ), a stone’s throw from Hong Kong.The subway station at Qianhai bay, on the city’s west coast, is spick and span, with a full complement of signs, announcements and billboards, including one for a performance by the BBC National Orchestra of Wales, sponsored by Classy Kiss milk. But only one exit is open. And it surfaces in the middle of a wasteland of dirt, scrub and puddles. It is, surely, the best connected nowhere anywhere. In this section * Powering down *  »The more special economic zone * Rollercoaster * Duncan dough notes * The Oracle of Bos ton * Move over Reprints Related topics * Hong Kong * China This empty spot is, however, full of big ambitions.It is one corner of a 15-square-kilometre zone earmarked for experimentation by China’s cabinet. The zone has licence to try policies that are â€Å"more special† than those prevailing even in an SEZ. It aims to attract â€Å"modern service industries† rather than big-box manufacturers. It will charge only 15% corporate-profit tax and levy no income taxes on the finance professionals, lawyers, accountants and creative people it hopes eventually to attract. These cosmopolitan folk will live in a â€Å"waterfront city†, says James Corner, whose firm won a competition two years ago to design the bay’s future landscape.Over the next couple of years, he explains, the city will build a system of â€Å"water fingers†, large parks that collect, retain and purify the streams that flow from the hinterland, allowing water to enter the bay clea n and clear. Water is not the only flow Qianhai aims to collect and retain. It also wants to attract some of the offshore yuan that have pooled outside mainland China’s borders. Over 550 billion yuan ($87 billion) now sits in Hong Kong deposit accounts; another 60 billion yuan sits in Singapore, and 35 billion more resides in customer deposits in London, according to an April study by Bourse Consult.These yuan cannot flow freely back into mainland China, however. Banks can invest a limited amount in the mainland’s inter-bank bond market. Companies that raise yuan outside China can seek permission to invest the money in their operations inside the country. But the money can easily become bogged down in China’s exchange controls, especially when the authorities are trying to tighten credit. Qianhai, however, will be permitted to broaden these channels. Its firms will be given help in raising yuan offshore. Hong Kong banks will be allowed to enter the zone more eas ily. The ground will also be laid for greater cross-border lending. Since the mainland is targeting the gradual achievement of full yuan convertibility, Qianhai should be a pioneer for progress,† said Zhang Xiaoqiang of the National Development and Reform Commission, China’s planning body. The plan poses some puzzles. If offshore yuan were to be lent freely to Qianhai firms, what would stop them lending the money on to the rest of the country? An easing of capital controls between Hong Kong and Qianhai would seem to require a tightening of controls between Qianhai and the rest of the mainland. Otherwise the stream of yuan inflows could become a flood.The answer to the puzzle may lie in the timing. The Qianhai zone is not scheduled for completion until 2020, by when China’s capital controls may already be far looser nationwide. It is therefore unlikely that Qianhai’s opening up will get too far ahead of the rest of the country’s. In finance, as well as infrastructure, China likes to lay down the tracks, platforms and ticket barriers before the throngs arrive. Definition of ‘Special Economic Zone – SEZ' Designated areas in countries that possess special economic regulations that are different from other areas in the same country.Moreover, these regulations tend to contain measures that are conducive to foreign direct investment. Conducting business in a SEZ usually means that a company will receive tax incentives and the opportunity to pay lower tariffs. Investopedia explains ‘Special Economic Zone – SEZ' While many countries have set up special economic zones, China  has been the most successful  in  using  SEZ to attract foreign capital. In fact, China has even declared an entire province (Hainan) to be an SEZ, which is quite distinct, as most SEZs are cities. Read more:  http://www. investopedia. com/terms/s/sez. sp#ixzz29RnLw992 China's Special Economic Zones Keep Importance| China's speci al economic zones will still be â€Å"special† after the country's entry to the World Trade Organization (WTO) and can continue to boom because they are better prepared for its rules, officials and economists said on Wednesday. | | | PRINT|   DISCUSSION|   CHINESE|   SEND TO FRIEND| | | | Special zones better prepared for WTO rulesChina's special economic zones will still be â€Å"special† after the country's entry to the  World Trade Organization  (WTO) and can continue to boom because they are better prepared for its rules, officials and economists said on Wednesday.While thousands of Chinese businesses have yet to familiarize themselves with the WTO principles and practices, China's technological and economic areas are already ahead of the game, said Pi Qiansheng, chief official who oversees the  Tianjin  Economic Development Area (TEDA). Special Economic Zones| President Jiang on Special Economic ZonesChina will develop special economic zones (SEZs) a ll through the process of the country's reform, opening up and modernization drive, Chinese President  Jiang Zemin  said November 14 in Shenzhen, China's first SEZ.Feature : Economic Zones| Chief special economic zonesChina's chief special economic zones are Shenzhen, Zhuhai, Shantou, Xiamen cities and  Hainan  Province. But they encompass more than 100 national economic and technological development zones, 15 national bonded areas and 14 border trade and co-operation regions in the broadest sense, said Hu Ping, former director of the Special Economic Zone Office under the State Council.Years before China joined the global trade club, the special economic areas had begun operating in line with international practices, said Pi, director of the administrative commission of TEDA, the largest development zone in North China. â€Å"By implementing international practices – like simplified approval procedures and transparency – TEDA has actually been operating accor ding to WTO rules,† he said. Keep going wellBoth Pi and Hu denied allegations that the national treatment and non-discrimination principles of the WTO will undermine the development of the special economic and technological reas, which used to receive – and give – preferential policies. â€Å"The special zones in various sizes and forms in China have grown from their initial state when they needed policy support before they were able to rely on themselves for expansion,† Hu said. â€Å"I don't see much of a negative impact of WTO entry on their recruitment of experts and the overall investment environment. † The special zones can instead maintain their â€Å"special† status by maximizing their accumulated expertise and their advantages in geographic locations and export-orientated industrial structures.They can gain a head start in absorbing foreign funds, technology and developing modern logistic systems, Hu said. The bonded zones, export pr oduct processing quarters and high-tech parks in those special areas will open still wider, Pi said. â€Å"It is my understanding that the WTO rules obligate the government to shift its functions to serving businesses in a more efficient fashion,† Pi said. â€Å"In TEDA, for example, the authorities have already modified or removed all the regulations and operations that go against the WTO rules. â€Å"Within the framework of national treatment requirements of the WTO, TEDA will give more favourable policies to overseas investment to attract more transnationals, he said. | SEZs: Go the Chinese way S. Majumder SPECIAL Economic Zones (SEZs), first proposed in the Exim Policy 2000-01 by the erstwhile Commerce Minister, Mr Murasoli Maran, are now a reality. With Export Processing Zones (EPZs) failing to help achieve the export targets, sights are on SEZs to deliver the goods. Eight SEZs are already operational — seven EPZs were converted for this purpose — and ano ther nine have been approved and are to be located strategically.The Commerce Minister, Mr Arun Jaitley, overwhelmed by the success of China's SEZ experiments has reposed much faith in them not only for export growth but also to boost FDI, which has become imperative especially as domestic investments are sagging. It is heartening that Mr Jaitley seems to be aware of the fact that the objectives of SEZs are much wider than merely boosting exports. Can India replicate China's immensely successful SEZ model? The incentives offered in Indian SEZs are in no less than those in China.From duty-free imports and tax holidays to freedom from cumbersome Custom procedures, the SEZs' facilities match those in China. Hence, theoretically at least, India's SEZs should be no less attractive to foreign investors as the Chinese versions. But reality paints a different picture. The key to SEZ success lies not just handing out incentives. Conceptually, EPZs and SEZs are different — while the fo rmer is an industrial estate, the latter is an industrial township. Boosting incentives to SEZs does not necessarily mean greater investment flows. The scope of SEZs are much wider and their linkages with the domestic economy stronger.SEZs provide supportive infrastructure such as housing, ports, roads and telecommunication and, as a result, have a wider industrial base. Compared to EPZs, SEZs give more in terms of exports, industrial growth, investments, both domestic and foreign, and employment generation. Hence, merely switching from EPZs to SEZs, without undertaking the required structural changes, does not guarantee success. The China story There are five SEZs in China. Of these, four — Shenzhen, Xiamen, Shantou and Zhuhai — were founded 20 years back and the fifth, Hainan, was set up in 1988.There are eight distinguishing features which have contributed to the success of SEZs in China: Unique location, large size, investment friendly attitudes towards non-residen t Chinese, attractive incentive packages, liberal Custom procedures, flexible labour laws, a strong domestic market and decentralisation of power in favour of provinces and local authorities for administering the zones. Of the five SEZs, Shenzhen, Shantou and Zhuhai are in the Guangdong province, adjacent to Hong Kong — the gateway to China. The other SEZ, Xiamen, in the Fujian province, is nearer Taiwan. Setting up hese zones close to internationally reputed commercial destinations was basically for easier access to foreign investments, modern technology and managerial expertise. This move paid off. FDI spurted in China — with Hong Kong accounting for about 60 per cent of the total inflows — with foreign investors making a beeline for the SEZs. Initially, the majority of foreign investors were non-resident Chinese from Hong Kong who were engaged in trading. Later, MNCs started investing in technology-oriented sectors even as China liberalised its foreign invest ment policy further to attract modern technology.The Guangdong province, which has the largest number of SEZs, became the most attractive foreign investment destination. In 2001, over 25 per cent of China's FDI flowed into Guangdong. Size is another important factor for SEZ success in China. Each SEZ is well over 1,000 hectares, the minimum recommended area. In India, the EPZs converted into SEZs are not even a third of this. Among the converted SEZs, the one in Noida is the largest but extends only 310 hectares. The SEEPZ, the first SEZ in India, is only 93 hectares.In such small areas, the requisite infrastructure and services required of an SEZ cannot be created nor multiple economic activities undertaken. Strong domestic market is another important aspect for SEZ success. In China, about 50 per cent of SEZ sales are to the domestic market. Though India has a large domestic market, it has failed to project this to lure SEZ investors. The reason: Policy impediments to sales in the domestic market. While in China the thrust of SEZs has been to attract foreign investments and modern technology, in India the emphasis has been on exports.The policymakers seem to think that export success in the zones is difficult unless accompanied by a liberal FDI regime. In China, the contribution of SEZs to the total exports is not substantial even after 20 years of their existence. In 2001, the share of the five SEZs in the country's total exports was 10. 4 per cent. In contrast, the contribution of Indian SEZs in 2001-02 was a little over 4 per cent of the total exports. Decentralisation of power was also a major reason for SEZ success in China. Provincial and local authorities were made partners and stakeholders, by delegating to them powers to approve foreign investment.The SEZ authorities in China can approve foreign investment proposals up to $30 million. In India, only State governments are allowed to set up SEZs and the powers for foreign investment approvals are vest ed with the Development Commissioners, who are the representatives of the Central Government. The hire-and-fire policy in SEZs has been one of the biggest attractions for foreign investors in China. The new labour law consists of 107 articles, but none of these is more than one paragraph. All jobs are on labour contract basis, which stand terminated upon the expiry of the terms, which can be fixed/flexible or for a specific job.In contrast, the labour policy in India is worker, rather than investment, oriented. Merely declaring SEZs as public utilities under the Industrial Disputes Act may not suffice to quell the image of labour unrest in the country. In sum, the fundamental objectives for setting up SEZs and their role in the national economy are different in the two countries. In such a situation, multiple doses of incentives and unravelling the procedural hassles in India may not in themselves aid SEZs. The impending need is buoyancy in foreign investments, which would automatic ally catapult exports.For this, the primary need is to foster SEZs as investment-friendly areas. This job is not of the Commerce Ministry alone, which is empowered to tinker with the Exim Policy only. The Foreign Investment Promotion Board (FIPB) and the Foreign Investment Implementation Authority (FIIA) also have an equally important role to make SEZs a success. SPECIAL ECONOMIC ZONES (SEZS) ? Special economic zones (SEZs) 1 aim to overcome barriers that hinder investment in the wider economy, including restrictive policies, poor governance, inadequate infrastructure, and problematic access to land.SEZs tend to offer export-oriented investors three main advantages relative to the domestic investment environment: 1) they offer a special customs environment including efficient customs administration and (usually) access to imported inputs free of tariffs and duties; 2) they have historically offered a range of fiscal incentives including corporate tax holidays and reductions, along w ith an improved administrative environment; and 3) they provide infrastructure (including land, factory shells, and utilities) that are more accessible and reliable than would normally be available outside the zones. SEZs have a long-established role in international trade. Prior to the 1970s, most zones were clustered in industrialized countries; but since the 1980s, there has been massive growth in SEZs in developing countries, led at first by East Asia and Latin America and more recently by the development of new programs in Central and Eastern Europe, Central Asia, the Middle East, and North Africa. Recent estimates indicate that there currently are more than 3,000 SEZs established in some 135 countries.Overall SEZs are estimated to account for more than US$200 billion in global exports and employ directly at least 40 million workers. ? Most zones set up in the 1970s through the 1990s were designed to attract investment in labor-intensive assembly and manufacturing from multinat ionals. These export processing zones (EPZs) were a cornerstone of trade and investment policy in countries shifting away from import-substitution and in favour of integrating into global markets.Among the multiple objectives normally being sought as part of these policies were: job creation, growth in exports and foreign exchange earnings, facilitating economic diversification (often as a step in processes of industrialization and industrial upgrading) and access to foreign manufacturing technology and know-how. KEY ISSUES AND CHALLENGES ? In some countries, SEZs have been a powerful instrument for economic growth and structural transformation. For many of the initial zones in East Asia, zones proved played a critical role in facilitating the industrial development and upgrading the ‘tiger’ economies.Similarly, the later adoption of the model by China provided a platform for attracting FDI and not only supported the development of its export-oriented manufacturing sect or, but served as a catalyst for sweeping economic reforms that were extended throughout the country. In Latin America, countries like Dominican Republic, Honduras, and El Salvador used free zones to take advantage of preferential access to US markets, and have generated large-scale manufacturing sectors in economies that were previously reliant on agricultural commodities.Finally, in Africa, SEZs are credited with enabling Mauritius to move from dependence on sugar to become a manufacturing hub and eventually an innovative, middle income country. ? However, there are also many examples of failures of SEZs, where investments in zone infrastructure resulted in ‘white elephants’ or where zones have largely resulted in industry taking advantage of tax breaks without producing any substantial employment or export earnings.Moreover, many zones that appear to have been successful in the short term, have failed to remain sustainable once labor costs have risen or when preferen tial 1 The term â€Å"SEZ† is being used here in a generic sense to cover any one of a variety of similar regimes including „industrial free zones? , „special economic zones? , „maquiladoras? , „export processing zones? , „investment promotion zones? , „foreign trade zones? and „free zones? What are Special Economic Zones (SEZs)? What are the Key Issues and Challenges for SEZs?What is the World Bank Group doing on SEZs? TRADE ISSUES BRIEF: Special Economic ZonesWorld Bank Group – Poverty Reduction and Economic Management Network – International Trade Department trade access is no longer an advantage (e. g. following the end of the Multi-fiber Agreement). Zone failures can be attributed to a variety of causes. Too often, zones are plagued with the same problems – unstable electricity, lack of water, heavy bureaucracy, inefficient and corrupt customs – that hinder investment in the wider economy.In addition, broader competitiveness challenges, including policy instability, poor national governance, and low productivity often undermine the potential of zones. ? The traditional manufacturing-oriented processing zone (EPZ) is becoming increasingly anachronistic, despite the continued importance of global production networks. This is for three main reasons. First, by limiting activities to manufacturing only, EPZs restrict opportunities for investment and growth in the services sector, one of the most important opportunities for growth in middle income and even many low income countries.Second, the traditional EPZ tends to create an enclave that is separated from the national market, undermining its potential to create effective domestic linkages. Finally, the traditional EPZ model relies on unsustainable fiscal incentives to attract investment. As a result, there has been a gradual shift from traditional EPZs to special economic zones (SEZs), which normally cover larger land areas, offer g reater flexibility for services and other non-manufacturing activities (including residential and tourism development), and include a greater mix of export and domestic-market focused activities.THE WORLD BANK GROUP AND SEZS ? The World Bank Group has worked with client governments on export processing zones, free trade zones, and SEZs for decades. More than 40 SEZ related projects have been undertaken in the past ten years. This work has included Bank lending for on-site and off-site infrastructure, IFC investment, and technical assistance and knowledge products from various Bank units and the Investment Climate Department on SEZ-related policies, legal and regulatory frameworks, institutional design, and feasibility studies.OUR WORK ON SEZS ? During 2009 and 2010, the World Bank’s International Trade Department (PRMTR) has been leading a major global research study on SEZs – supported by a BNPP trust fund and in partnership with the SEZ team in the World Bank Groupâ €™s Investment Climate Department – with a primary emphasis on the experience SEZ programs in Sub-Saharan Africa. The main question addressed in this study is: why have SEZs worked well as engines of growth in some countries but not in many Sub-Saharan African ones? Based on knowledge developed as part of this research, PRMTR is also supporting the World Bank Group’s program looking at the potential role and impact of China’s investment in African industrial zones on the development prospects for the region. Our portfolio of SEZ knowledge products in 2010 includes: I. A book summarizing the results of PRMTR’s major research project: Special Economic Zones in Africa – assessing performance and learning from global experience (forthcoming); II.A set of case studies of SEZ programs in ten countries (Bangladesh, Dominican Republic, Ghana, Honduras, Kenya, Lesotho, Nigeria, Senegal, Tanzania, Vietnam); III. Results from surveys of investors in SEZs in the same ten countries as above; IV. A series of notes covering topical issues in SEZs, including: regional trade agreements and SEZs; WTO rules and SEZ fiscal incentives; gender aspects of SEZs; using SEZs as catalysts for economic reform; training and skills development in SEZs; etc. and V. Notes related to China’s investment in African industrial zones, including an overview of progress and challenges and a proposed framework for effective collaboration, as well as a note drawing lessons from China’s experience in establishing a knowledge-sharing partnership for SEZs with Singapore in China’s Suzhou Industrial Park. An investigation into the importance of special economic zones in developing economies by Raphael Monye on September 18, 2010Over the past decade, there has been a sea change in economic policies in  developing countries which are attempting to become more export- orientated,  they   have started setting   up free trade zones. These zon es are called â€Å"Special Economic Zones†(SEZ’s) and feature various   designed to encourage foreign investment. What is the significance of these zones? Have they really played an important role in the development of the economy of the developing countries? In this paper I first describe the background to the establishment of these zones, then I describe some of the aims and characteristics of the SEZ’s.Lastly, I attempt to assess the significance of the SEZ’s in the development of the wider   economy Historically, China for instance  has adopted an inward-looking strategy to its economic development. Successive Chinese governments thought that the economy could grow  purlythrough self-reliance. However, there are always limitations to what a country can do by itself, for example limitations in raw-materials, natural resources, technology, etc. These can hold back the growth of an economy and certainly China’s economic growth  lagged f ar behind much of the rest of the world up to the 1970? . The aims of the establishment of the sez’s were to earn foreign exchange, to  enhance  employment, to attract foreign investment and to accelerate the introduction of technology and managementexpertise The favourable impact of the SEZ’s on  an economy of   is fivefold: They attract foreign investment, they help the growth of the export industry, they earn foreign exchange, they provide employment opportunities and lastly they help the  indigenous  economy improve its level of technology.I would now like to look at some of these points in more detail Since the beginning of the open-door policy, small-scale private businesses have been allowed to coexist with state enterprises. This has increased employment opportunities for local people and raised the level of economic activities in most developing countries. Also, many state workers sense that going into business on their own may provide greater inco me potential. Many prefer to work for joint-venture firms for higher wages.So the average income in SEZ’s   ranks as the highest in most of these economies. In theory advanced technology and know-how will also flow into the country as a result of foreign investment. In turn, with increasing exports the force of international competition may bring greater pressure on   firms to adopt more efficient work practices. It is perhaps questionable how much benefit the wider developing  economies has  reaped  from these investments. The technology, patents and know-how remain firmly the property of, and are controlled by the parent companies.It may however be the case that in the long run the work culture and practices adopted by foreign companies could have some washback effect over wider economic practices in the country In conclusion, the establishment of the SEZ’s has helped to increase the export trade which in turn has helped to improve the  developing economy . Preferential treaties  are been made in  SEZ’s to attract foreign investment. A large amount of foreign investment has occurred not only in the export trade, but also in infrastructure construction, commerce and tourism.Foreign companies have been encouraged to set up factories in the territories and the export industry has grown. Jobs opportunities have been provided for locals as factories need labour and the average income of the people has increased. In addition, advanced foreign technology has been brought in with the inflow of foreign investment. All these factors have contributed to the growth of the  developing economy. It remains to be seen if these  quantitative  advances, in which the SEZ’s have played an important role, are matched by  commensurate  advances in the quality of life for the majority of   people in theses countries.Special Economic Zones and tax exemption in China The key tax incentive for investing in China lies in the vario us options available for claiming tax concessions. The three main avenues are tax exemption, location-based concessions, and activity-based concessions. In theory, foreign-invested companies in China are subject to 30% corporation tax plus an additional 3% local corporation tax. In practice, however, foreign-invested companies rarely have to pay the full corporate tax rate. Tax exemption and 50% tax reductionManufacturing companies operating in China for at least ten years are granted a tax exemption period from the date of entering the profit zone. In the first two years they are fully exempt from corporation tax, and in the following three years they are granted a 50% reduction in the tax burden. The fiveyear period begins in the year in which an accumulated profit, after taking into account loss carryforwards, is recorded for the first time. However, the tax exemption period is not interrupted if at any time after commencement of the period a company once more records losses.Furt hermore, only taxable losses within a maximum carryforward period of five years are taken into account when determining the date on which an accumulated profit is recorded. Companies in the following sectors and areas are regarded as manufacturing companies and hence eligible for preferential taxation treatment: – Engineering and electronics industry; – Energy industry (excluding oil and natural gas extraction); – Metal industry, chemical industry, manufacture of construction materials; – Light industry, textile industry, manufacture of packaging materials; Medical and pharmaceutical industries; – Agriculture and forestry; – Construction industry; – Communications and transport industries (excluding passenger transport); – Scientific and technical development, geological studies, consulting services aimed at production improvements, maintenance services for production equipment and precision instruments. The above list is not e xhaustive and may be extended to other areas. In principle, exemption followed by a reduction in the tax burden is only granted if the company’s activities in China extend over at least ten years.If operations in China are discontinued before this ten-year horizon, Chinese tax law requires that the concessions be reimbursed. Special Economic Zones and Economic and Technological Development Zones After China opened up back in 1980, government-promoted Special Economic Zones (SEZs) were set up to attract foreign investors to the country. The main purpose of these Special Economic Zones with their many investment incentives was to strengthen China’s embattled economy with foreign capital and to modernise the country through foreign technology.Manufacturing companies are generally granted a reduced tax rate of 15% in these zones, with full tax exemption in the first two years and a 50% reduction in tax during the three following years. Foreigninvested service companies and banks can also benefit from tax concessions but are subject to special regulations in these zones. The Special Economic Zones are in: – Shenzen, Guangdong Province; – Zhuhai, Guangdong Province; – Shantou, Guangdong Province; – Xiamen, Fujian Province; – Hainan Island, Hainan Province. Moreover, Economic and Technological Development Zones ETDZs) were set up in 14 coastal cities of the People’s Republic of China in 1984. To date this number has been extended to more than 50. The aim of these development zones was the targeted opening of investment zones for foreign investors, as well as research and development in specific areas through the application of modern foreign technologies. In particular, foreign investors in these zones are offered a complete infrastructure that meets international standards. Economic and Technological Development Zones are to be found not only in booming metropolises such as Shanghai, Beijing nd Shenzen, but als o in all-important Chinese industrial cities as well as in cities of local economic importance in the interior. The Chinese accord these development zones the highest priority, which is why in recent years China’s booming major cities in particular have evolved to become the favourite locations for foreign investors, due to the many concessions and well-developed infrastructure on offer. Nevertheless, when deciding on a location it is important to take into account the cost of labour, which is significantly cheaper in the more rural development zones in the interior.Tax-wise, there is no difference between the Special Economic Zones and the other Economic and Technological Development Zones. Here, too, a reduced tax rate of 15% is generally applicable, with full tax exemption in the first two years and a 50% reduction in the following three years. Unlike the Special Economic Zones, however, the Economic and Technological Development Zones do not differentiate between manufact uring and service companies. Open coastal towns and old cities The 14 eastern ports of Dalian, Qinhuangdao, Tianjin, Yantai, Qingdao, Lianyungang, Nantong, Shanghai, Ningbo, Wenzhou,Fuzhou, Guangzhou, Zhanjiang and Beihai were also opened to foreign investors in 1984. Now there are more than 300 open coastal cities and old towns in China, offering similar concessions to the Special Economic Zones. If these cities also contain a Special Economic Zone or an Economic and Technological Development Zone, companies are also granted a reduced tax rate of 24% outside these zones. If necessary a tax rate of 15% can also be granted subject to the approval of the Chinese authorities, provided the company’s business falls into one of the following categories: Technological projects or projects requiring expertise; – Projects with a foreign investment volume of at least USD 300 million and a long repayment period; – Projects in the field of energy generation, communication o r port operations; – State-promoted projects. High-Tech Industrial Development Zones Only in recent years has the Chinese government created newer types of development zones called High-Tech Industrial Development Zones (HTIDZ) primarily aimed at promoting and further developing the scientific and economic potential inherent in China through foreign capital investment and the import of know-how.Currently there are more than 50 HighTech Industrial Development Zones where foreign high-tech companies are granted a reduced tax rate of 15%. Joint ventures with a foreign partner scheduled to operate for over ten years may also be granted tax exemption or a 50% reduction in tax, similar to the above-mentioned concessions, subject to approval by the Chinese authorities. Currently the best-known High-Tech Industrial Development Zone is the Zhongguancun Science and Technology Park in Beijing. Shanghai Pudong New Area By contrast, foreign companies operating in the financial, ndustrial and trade sectors have been enjoying numerous tax concessions in the Pudong district since 1992. Financial services providers in particular are becoming increasingly important in this context. While foreign financial institutes are prohibited from setting up offices in all other investment zones, this zone – which is also home to a stock exchange – is to be established as a financial centre. The applicable tax rate in this area is 15%. Moreover, in a bid to promote the infrastructure, the Shanghai Pudong New Area offers special tax incentives to foreign companies engaged in the construction of roads, railways, orts and airports as well as companies engaged in energy and transport projects. These companies are also offered a generally lower tax rate of 15%. If scheduled to operate for at least 15 years, these companies enjoy full exemption from taxes for the first five years and a 50% tax reduction for the following five years. Other regions In addition to the above-men tioned areas, a wide range of other regions grant foreign companies tax concessions with a view to attracting such businesses and promoting economic expansion in China’s structurally weak regions.These currently include 13 open border cities, remote and underdeveloped regions as well as numerous central and western regions of China. Particularly in the remote and underdeveloped areas of China, companies enjoy full tax exemption for the first two years and tax concessions for up to 15 years. In all, 19 central and western provinces offer companies in defined industrial sectors a wide range of additional concessions which are listed in a catalogue specially drawn up for this purpose. Concessions for special sectors and activitiesNevertheless, eligibility for tax concessions is dependent not only on the choice of location but also on the company’s business activities. For instance, special concessions are granted to export-oriented companies with an export ratio of more t han 70% which are scheduled to operate for more than ten years. Companies which qualify as  «technologically advanced » enterprises may request a three-year extension beyond the statutory five-year tax concession period. The requirements for eligibility in this respect are described in a special catalogue of criteria.Qualification for such additional concessions is subject to an on-site examination by the authorities of the information provided in the application. Special concessions may also be requested by companies in the software industry, with the aim of turning China into a world leader in the field of software products. These primarily concern VAT and customs duties, but additional concessions may be granted in the form of a reduction in corporation tax to 15%, shorter depreciation periods or higher expense deductions provided the defined criteria are met. Furthermore, in order to make China’s economic expansion nd infrastructure more attractive to foreign companie s, longterm projects relating to port construction as well as in the Special Economic Zones of Hainan and Pudong and in the field of airport and rail construction enjoy substantial concessions up to and including full tax exemption for the first five years as well as a tax reduction of 50% for the following five years if, as above, they meet the relevant criteria. Similar conditions also apply to agricultural projects. Research and Development (R&D) Centres can also enjoy tax concessions provided they meet a number of defined requirements.Specifically, these govern employee qualifications, investment volume, the quality of equipment used, exclusive use of invested capital for R&D purposes, etc. The concessions granted are related to the transfer of technology developed in-house and associated consulting and other services, the import of business equipment including the associated technologies, accessories and spare parts, and increased deductions on R&D expenditure. On t he other hand, companies in heavy industry and plant construction or companies engaged in the extraction of raw materials are expressly excluded from the statutory five-year tax concession

Why does Shilling describe the body as unfinished Essay

Why does Shilling describe the body as unfinished - Essay Example The self that we come to recognise is an embodied self, and we use the power that is in that body to interact with the world around us. We have to exercise control on that body, but and in so doing we build up an ordered view of our own identity which we then present for others to see and interact with. This explains how and why our view of the world is necessarily bodily centered. The work of Shilling (1999; Shilling and Mellor, 2007) builds on this groundwork and explores the tensions than can exist between the self and the body. Every human being exists in a physical form, that is to say a body, and yet also at the same time is able to conceive of this body as something separate from, but still related to, the actual self. This ability to distinguish mental and physical attributes creates a number of problems for sociologists, because it is not understood and applied in exactly the same way across different cultures and in different historical times. This paper discusses two paper s in which Shilling discusses the body in relation to society, and theorizes that the body is in a fundamental way unfinished. The main points of the two articles are summarized and the reasons which led to the formulation of the â€Å"unfinished body† hypothesis are explored. Finally this paper outlines some of the implications of this important way of understanding the relationship between body, identity and society. In the past the vocabulary of religion would have been used to portray this kind of issue as a contrast between the body and the spirit or even the soul. In modern times different sociologists such as Parsons (1988) and Lockwood (1964) have debated interrelationships between humans and society and there have been many different ways of theorising the body in a social sense. In Shilling’s view, too much attention has been paid to the mind, and not enough to the body, resulting in a view of the individual and of society which is flawed. Concepts such as ag ency and interaction have been too often defined as if they were somehow â€Å"disembodied.† (Shilling, 1999, p. 544) In 1999 and again in 2007, Shilling addresses these problems, and brings out a series of arguments to show that the individual human body is unfinished, because it requires interaction with others before it can achieve integrity and cohesion. This paper considers the arguments of each paper in turn in the light of other scholars who have examined similar issues and explores what Shillings means by the body being â€Å"unfinished† and why, along with implications of this insight for sociology in the twenty first century. In the earlier paper Shilling turns to the work of Goffman (1983) on the individual’s need for a social self, through which interactions with others are lived: â€Å"People are confronted with the necessity of establishing interpersonal relations with others, in order to construct a social self, and remain vulnerable within this domain: interaction occurs within arenas which expose people, physically and mentally, to others (Shilling, 1999, p. 546). According to Shilling, Goffman improves on earlier work on the self and society by taking more account of corporeal and emotional aspects, and this puts the mental, or cognitive, aspect back into its place alongside these other ones, rather above them in a position of pre-eminence. Goffman’s work on embarrassment (Goffman, 1983) clearly describes some of the physical signals that occur when people engage in particular activities, and this causes Shilling to reflect on the supposed interconnection between thoughts, emotions, and bodily experiences. He

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