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Hong Kong accountant Laurence Lipsher remembers Shenzhen when the special economic zone was little more than a Chinese fishing village with 350,000 residents. The commute from the outskirts of town used to take him four hours on rainy days. Today the same trip takes 10 minutes on a modern subway, which came with other developments as the region’s population swelled to 13 million people in less than 25 years.
“The descriptions you might have read about Shenzhen do not truly express what it feels like to be there and witness and participate in double-digit sustained economic growth for a quarter century,” Lipsher told an audience of about 125 Thunderbird alumni gathered Nov. 6 at a global reunion in Macau.
Lipsher, a 1965 Thunderbird graduate, says the growth will continue until Shenzhen blends into Hong Kong, and the two regions amalgamate into the first super megalopolis of the 21st century.
Lipsher says China will need to repeat the miracle of Shenzhen again and again as the nation’s rural poor leave the countryside and move to big cities looking for new opportunities. Currently, China has about 700 million rural poor but can only support about 300 million of them.
“People will do anything to get out of the countryside and go to the city, which can’t support them,” Lipsher said. “We discovered Shenzhen, which grew from nothing to 13 million people in a quarter of a century. China has to develop a half dozen cities like this over the next 50 years, plus take 100 million more people and put them into the current existing cities.”
For now, Lipsher says, China is betting on four new special economic zones. Two of these zones already have been announced, and Lipsher expects two more announcements in the near future.
The Binhai economic development zone, announced in 2008, falls within the jurisdiction of Tianjin. Lipsher says the trip from Beijing to Tianjin used to take more than four hours, but a high-speed rail system has cut the commute dramatically.
“It now takes a half hour with a train system that is up and functioning and going very smoothly,” Lipsher says. “That makes Tianjin a suburb.”
The second economic development zone, announced in 2009, is Haixi west of the Taiwan Straits. Lipsher says China has set up the zone to take advantage of Taiwan’s economic problems in the global recession.
“Economically, Taiwan is so intertwined with China, that within a decade you’re going to find some form of loose amalgamation,” he said.
Even if these zones and others all go according to plan, Lipsher says the accommodation of China’s rural poor remains the country’s biggest challenge of the 21st century. But he remains optimistic about China’s future.
“How they’re going to do this, I don’t know,” he said. “But if anybody can do it, China can.”
Lipsher, author of The Tax Analects of Li Fei Lao, is a 1965 Thunderbird graduate. Learn more in the Thunderbird Knowledge Network video below:
Podcast: Laurence Lipsher on China’s vision for the 21st century (15:50)
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