Collaborative Public Spaces and Manufacturing Cluster Formation: The Case of Dongguan, China

In this paper, we discuss the development, boom, reform, upgrading and long-term sustainability of the electronics and information technology hardware industry cluster in Dongguan, China. Development and economic upgrading in Dongguan has been reliant upon the resilience of a collaborative public space (CPS). The CPS is a social space imbued with mutual trust enabling economic and political actors to interact, share concerns and plans, share knowledge and mutually upgrade capabilities. While industrialization in Dongguan began with Hong Kong-invested manufacturing firms, it was only with the arrival of Taiwanese IT hardware firms and their production system made of hundreds of small and medium sized enterprises engaging in sustained exchange relations that the CPS formed. By providing a social space in which firms – including local Chinese firms – can interact and learn from one another, as well as liaise with the local government, the CPS has enabled economic upgrading in Dongguan. The CPS has enabled Taiwanese firms, and local Chinese firms connected through the CPS, to sustain their activities and profitability. In contrast, Hong Kong firms, despite having strong and enduring ties to local governments, have increasingly failed or left the region seeking lower labor costs. The Dongguan story thus offers a very different picture of how local industrialization through foreign direct investment can be organized and sustained.