Shannon – a tiny Irish town inspires China’s economic boom

Shannon – a tiny Irish town inspires China’s economic boom
Shannon airport, site of the world’s first duty free shop, in 1959

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Shannon – a tiny irish town inspires china’s economic boom
Shannon airport, site of the world’s first duty free shop, in 1959

Created in 1959 to lure foreign investors with tax breaks, the Shannon Free Zone proved revolutionary across the world. But in today’s world of looser trade and tax havens, Ireland’s innovators face an uphill battle to stay relevant

When Wen Jiabao visited the small Irish town of Shannon in 2005, it was like a religious pilgrimage for the then Chinese premier and arguably the world’s second most powerful man. He was the latest in a long line of high-level Chinese dignitaries to come and pay their respects to the site on the west coast of Ireland where they believe China’s rise to superpower status really began.

In the buildup to the visit, the Chinese ambassador had told his Irish hosts that they wanted time to allow Wen to pause for reflection on the “plateau” – a spot on Tullyglass Hill that overlooks a grey, windswept, industrial estate. “To us it was just this nondescript place on the top of a hill, but for the Chinese, they wanted to see where it all started,” said Kevin Thompson, president of the Shannon Chamber of Commerce, pausing at the memory of this incongruous spectacle. “This was the leader of China, a country with a population of 1.3 billion!”

Shannon is a tiny town with a population of just 9,673 in the middle of rural County Clare. But it is famous in the history of economic development, widely considered the site of the first modern “special economic zone” (SEZ). The industrial estate that Wen would have gazed upon that day is the Shannon Free Zone — a 2.5 sq km stretch of land that was carved out and given to foreign investors in the late 1950s, an audacious attempt to attract investment in exchange for tax holidays, tariff reductions and other incentives.

Today there are thousands of these zones around the world, the best-known of which are in China where they are credited with helping fuel the country’s dramatic economic boom over the past quarter century. The zones have attracted millions of people from around China looking for work and in the process created hundreds of new cities. […]


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