China's economic growth during 1984-93: a case of regional dualism.

This article presents an in-depth study of the regional dualistic growth pattern of the Chinese economy from 1984 to 1993. After opening up its economy to the rest of the world in 1979, China has been able to double its gross domestic product (GDP) twice by 1994, with an average annual real growth rate of 10.5%. However, Chinese economic growth has been uneven as is evident from disparate growth rates especially between the Eastern (coastal) and the Western (far inland) regions of the country. The imbalance in economic growth between the two regions has been exacerbated since China further opened the coastal region in 1984. For instance, the economic growth rate of the Eastern region was 11.4% on average from 1984 to 1993, while it was 8.9% for the Western region. This led to an increased economic gap between the two regions. In 1993 the GDP per capita of the Eastern region was 2.3 times as much as that of the Western region. The economic disparity between the two regions can be attributed to many factors, such as economic reforms and an open-door policy in favour of the Eastern region, differences in economic structures and resource conditions, a coast-orientated regional policy, and consequently differential impacts of foreign trade and foreign investment. The uneven growth and resulting increased interregional economic disparity in China have become a new focus for development economists and policy makers. Several studies have examined the influence of economic reforms and regional policy on regional economic development in China. Another group of scholars has studied regional impacts of foreign trade and foreign direct investment (FDI) in particular. These scholars have found that the impact of foreign trade and FDI on the economic development of China are different between the Eastern and Western regions.