THE YELLOW LAND

(Beijing, Tianjin, Shandong, Hebei, Henan, Shanxi, Shaanxi)

Territory: 906,243 km2 (9% of total)

Population: 359 million (27% of total)

Per Capital GDP: $3,855

Exports as % of GDP: 16%



China was born on the banks of the Yellow River, where the silt-laden water, rich alluvial soil, and the harvested wheat all share the same yellow hue. This is China’s breadbasket where buns, dumplings, and noodles, rather than rice, are standard fare. But the fertile Yellow Land is vulnerable to droughts and floods, as well as jealous invaders. Since ancient times, its inhabitants have turned to a strong central government to keep them safe behind high walls and embankments. In ancient times, the emperor’s yellow robes symbolized his absolute command over the natural forces—earth, water, grain—that ensure life.



Ruling the Yellow Land is a delicate balancing act. On its own, the Yellow Land would rank as the second most populous nation on earth, with more people than the United States packed into less than one tenth the territory. Its resources, while plentiful, are stretched to the limit. The Yellow Land produces huge quantities of basic staples like wheat, cotton, and peanuts, but is rapidly running short of water. It has rich energy reserves, but over-dependence on coal accounts for some of the world’s worst air pollution.

One resource this “nation” never lacks is clout. For most of China’s history, the Yellow Land has been the center of political power. It can attract talent on a massive scale, giving it immense influence. China’s leaders hope these advantages can turn Beijing into a high-tech research hub and transform a select handful of state-sponsored companies like Lenovo and Haier into “national champions” that can dominate global markets. But the heavy hand of the government can be stifling here. Can the Yellow Land leverage its power to open up new opportunities? Or will a region that fears innovation inevitably fall behind?

THE BACK DOOR

(Hong Kong, Macau, Guangdong, Hainan)

Territory: 231,963 km2 (2% of total)

Population: 112 million (8% of total)

Per Capita GDP: $6,910

Exports as % of GDP: 82%



In Chinese, the “back door” refers to a way of doing business outside the normal, approved channels. The South Sea coast is China’s Back Door, far enough from the centers of power that nobody will notice if you bend a few rules. As locals put it, “The sky is broad and the emperor is far away.” Officials who were exiled to Yueh, as this land was once known, found it a fearful place whose inhabitants spoke strange dialects—Cantonese, mainly—and feasted on snakes, cats, and monkeys. But its clan-based villages, lush jungles, and rocky inlets offered ideal shelter for smugglers and secret societies to flourish. Unlike their staid northern cousins, these freebooters learned to take risks and profit from them. Other Chinese regard southerners as clever, sharp, and a bit slippery. But as rebels and renegades, emigrants and entrepreneurs, they infuse much needed flexibility and creativity into an otherwise rigid system.



The Back Door might be troublesome to China’s rulers, but it has also been useful. When China was closed to the outside world, enclaves like Canton, Macau, and Hong Kong offered safely removed points of contact and exchange. So when Deng Xiaoping wanted to open China’s economy to trade and investment, the Back Door offered an ideal laboratory. If reforms failed, they could be disowned and contained without contaminating the rest of China. In fact, they succeeded beyond anyone’s wildest expectations, transforming the region into an export juggernaut and a model for the rest of China.