Is China’s Model of SEZ-Led Development Viable? A Call for Smart Replication

Abstract

While China’s experience of using special economic zones (SEZs) for advancing economic development is a model increasingly adopted in other developing countries, the processes involved in replicating this model elsewhere and the outcomes of such replication remain little understood. This review article’s nested examination of three relevant strands of literature and two case studies of India and Ethiopia indicates that successful replication of China’s SEZ-led development would involve deliberate processes of adaptation from the original model. Replication must be “smart,” by taking into account the temporal, systemic, and other discrepancies between the Chinese model and the replicating country; replicating the benefits of China’s approach whilst avoiding the drawbacks; and maximising the positive effects of direct Chinese involvement and investments while reducing negative repercussions.