| The emergence of subregional growth zones, also known as growth triangles, in Asia Pacific, involving the relocation of labour intensive industries from Hong Kong and Singapore, reflects changing comparative advantage conditions, the rise of transnational production networks amongst participants, and key political decisions encouraging the relocation of selected manufacturing from the metropolitan cores to their neighbouring hinterlands. Subregional growth zones are geographically contiguous areas separated by political boundaries but possessing different factor endowments due to varying stages of development.; The empirical evidence shows increased FDI, exports, imports, and reexports between growth zone participants during the period under study. Production profiles in participating economies changed during 1985-1997. Initial investments from core hubs into their hinterlands were for production relocation, then later for product and market integration. There is also mixed evidence regarding whether MNC subsidiaries located in both zones are part of buyer or producer driven global commodity chains in transnational credit, knowledge and production structures. Political decisions were crucial to the establishment of these subregional economic zones. Without the requisite political cooperation to support cross border trade and investment, closer economic ties between participants would not have taken place.; Growth zone development embodies aspects of the neoclassical, keynesian demand stimulus, and mercantilist policy options, more so than the protectionist option. MNC production, relocation, and investment decisions reflect their relational and indirect structural powers over governments. Their choice of production and investment locations reveal, implicitly, their preferred types of host investment regimes. |
