China’s spectacular economic development record has largely been concentrated in two areas – the so-called Pearl River Delta just north of Hong Kong and the immediate hinterland of Shanghai.

That process is starting to change, however. Over the past few years, labour costs have started to rise sharply in these coastal areas, threatening the competitiveness of lower-margin operators. Meanwhile, as these regions have prospered, they have become less tolerant of the pollution rapid industrialisation has created.