Jan 1, 1991
This report summarizes RAND research and recommendations for the strategic development planning of Hainan Island in the People's Republic of China. The recommendations are intended to assist the Hainan government in developing the economy along market-oriented lines. The emphasis is on the broad outlines of macroeconomic policies — in setting the fundamentals of fiscal, monetary, privatization, pricing, foreign exchange, and trade policies in a sound and mutually supporting direction and in drawing on the experience of the newly industrializing economies (NIEs) for relevant lessons. The authors discuss their analytic framework, which views economic reform as a systems problem; consider lessons drawn from other NIEs; review various major policy reforms, including currency, foreign exchange, and trade, and labor and capital market reforms; discuss fiscal reform, including both revenue and expenditure organizations and processes; and examine implementation issues, including feasibility, timing, and balance.