By Jieying Ding
China (Shanghai) Free Trade Zone, launched on September 29, 2013 with the
support of the Chinese Premier, Li Keqiang, is the first free trade zone in
China. It comprises four areas under the special administration of customs, and
is located on a 29-square-kilometer patch of land on the outskirts of Shanghai.
At its launch, it was thought to mark a major milestone in China’s commitment
to economic reforms and continuous wide opening to world markets. It was
supposed to attract foreign investment and introduce interest rate
liberalization and easy cross border capital flow.
However, political power struggles shadowed over the free trade zone
even before its launch. South China Morning Post, a Hong Kong newspaper
that is believed to have close connections with Beijing, cited three sources
with first-hand knowledge of high-level government meetings saying that Li
Keqiang slammed his fist on the table in frustration when he was told about continuing
opposition to the Shanghai free trade zone. Shortly before its launch, there
was speculation that China would lift its ban on Facebook within the
free trade zone, which was quickly denied by the state-run People’s Daily. Moreover,
Li Keqiang and his deputy’s absence at the opening ceremony surprised a lot of
people who had high expectations for the free trade zone.
