The Financial Times recently reported a tremendous sea-change in the investment policy as well as the popular sentiment of Guangdong province:

“China has taken the unusual step of moving a $5bn refinery and petrochemical plant, one of the country’s biggest foreign investment projects, after a public outcry, a senior Communist party official said on Thursday.”

This reflects how Guangdong values environmental protection, the ecology and the opinions of our citizens,” said Mr Wang, who sits on the party’s 25-member Politburo, in a rare interview with foreign reporters.”"

Really, this is revolutionary. Consider it was Guangdong province that first (re-)opened up to foreign direct investment in the early Eighties with Guangzhou and then Shenzhen leading the way to China’s future as an export-driven country. The “Hong Kong model” became the dominant model of foreign direct investment (FDI) in the region as Hong Kong companies just over the border moved their noxious toy and appliances factories off their territory and onto the Mainland. The Hong Kong Model became synonymous with terrible working conditions for staff in factories that paid extraordinarily low wages (“oh, but their pay is higher than what the Mainlanders would get back on the farms,” big bosses would croak); low or non-existent profit margins because the big bosses would skim surpluses off the top of the companies to spend on KTV parlors and second families; and a complete disregard for the environment. The ever-innovative Taiwanese took the Hong Kong model further by scaling it up to companies the size of Foxconn with its tens of thousands of drones, while maintaining the same skin-flint, anti-environment approach to doing business. The Hong Kongese with Taiwanese and wanna-be tycoons from the Mainland also helped create Guangdong’s vibrant KTV and spa industries.

With the mass closure the past eighteen months of thousands of these low-margin, labor-intensive factories in the region, hostesses throughout Guangdong must be agonizing the loss of their sugar daddies. Add to that the Guangdong provincial government’s efforts the last couple years to actually slow industrial investment in the region because of an over-stretched infrastructure and choking pollution. The government has been actively working to attract high-value, service- and IT- industries to its cities to literally clean up its act and lift its GDP growth rates to the next level.  So, Guangdong entertainment venues as well will find themselves re-tooling for a nerd-future.

But get this. A provincial level official actually says:

“We only have one planet to live on and whatever we do at this end affects people at the other end,” he said.

The plant was to be built in southern Guangzhou, the provincial capital, 60km upwind of Hong Kong, where the project has also come under criticism.

I didn’t think anyone in China was aware of “people at the other end” when it came claiming economic preeminence, leave alone cared about what happened to “them foreigners” [sic] in their mad scramble for world acclamation. Unless what they mean by “the other end” is Hong Kong itself – which, I suppose, can be considered widening their perspective. What’s also impressive to me is there is a quasi-democratic process at work here that may one day become a model in itself and spread to other provincial-level governments:

“Last year, 14 delegates to the provincial people’s congress filed a motion opposing the refinery on the grounds that it could worsen regional air pollution. That opposition emboldened environmental officials, who also began to question the project’s suitability pending the completion of an environmental impact report.”

Still, eminent domain reigned, and the locals had gotten the short end of the stick long before:

“The project was to have been sited in a new heavy industrial zone in the geographical centre of the Pearl river estuary, not far from a bird and wetland sanctuary. The site was marked out last year and villagers were relocated to new housing closer to the centre of Guangzhou.”

Residents may have lost their homes, but may have helped save their land.