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China and the United States are both using Special Economic Zones (SEZs) as a tool to advance their foreign policy objectives. SEZs are enclaves that have been granted exemptions to the normal business rules governing their home countries. They are created by governments to stimulate economic development, often through a combination of tax breaks, regulatory streamlining, and exemptions from the most costly rules for businesses. Most are industrial parks, although they come in many shapes and sizes ranging from airports to full fledged cities.
As tensions between China and the US grow, both countries have begun using SEZs as tools of economic warfare to advance their own respective geopolitical objectives.
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