- The first example is the Greater Bay Area (GBA). The Government planned to amalgamate 11 cities such as Hong Kong, Shenzhen and Macau to form a megapolis.
China is a central planning economy. The government takes a top down approach to decide which industries to be developed.
The U.S. is more ground up where entrepreneurs figure out the opportunities and eventually drive the direction of the economy.
In other words, investors should follow the entrepreneurs’ vision in the U.S. but watch for clues in the Chinese government’s plans when investing in China.
The good thing about a centrally planned economy is that the Chinese Government often publicly announce which industries are going to be developed. Investors should keep abreast with such plans.