Over the past two years, whenever I get together with old classmates, our conversations revolve around the Yangtze River Delta, centered on Shanghai. We sigh when we think of that city's blazing night skyline as seen from the Oriental Pearl Tower. We are impressed by the new Formula One racetrack. Shanghai fever continues. Someone even quipped that someday we will have to set up an alumni association branch there.

The Pearl River Delta, where most Taiwanese businesses first settled, seems to have lost its luster in recent years. When many people think of Guangzhou, they recall that it was the starting point of the Nationalist revolution, avian flu, and SARS.

But the relative media invisibility of the Pearl River Delta is misleading. Guangzhou's per-capita disposable income in 2003 year remained the highest of any Chinese city, at over RMB15,000-surpassing Shanghai's RMB14,867 and Beijing's RMB13,883. Shunde District in Guangdong Province's Foshan City is mainland China's wealthiest area. Known from ancient times as one of China's four great cities, Foshan is still a beacon for the rest of China.

Taiwanese businesspeople are one of the keys to Guangdong's affluence. Twenty years ago they began crossing the Taiwan Strait to set up factories in the Pearl River Delta. To this day, Guangdong remains the area in China most populated by Taiwanese businessmen, and by 2002 their cumulative investment there had reached US$8.4 billion. At least 400,000 Taiwanese are believed to reside permanently in Guangdong.

As the cradle of the PRC's economic reforms, the success of the "Guangdong experience" became the template for China's coastal cities. Shenzhen was transformed in less than a generation from a dusty fishing village into a thriving metropolis bristling with highrises, in much the same way that neighboring Hong Kong was changed a century ago. Over the past decade, however, other coastal cities have begun to thrive, following in Shenzhen's wake. They include Jiaxing and Ningbo on Zhejiang's Hangzhou Gulf, Shanghai and Suzhou in the Yangtze Delta, Beijing and Tianjin along the Bohai Sea, and Dalian and Shenyang in the northeast. The Pearl River Delta, situated in China's southern recesses, it is now not as attractive for foreign investment.

To learn more about the Pearl River Delta's roller-coaster ride and the changes Taiwanese businesses have seen, Sinorama senior editor Vito Lee and photographic director Jimmy Lin visited the region during the China Export Commodities Fair. They talked with Taiwanese entrepreneurs who spoke positively of the fruits of past efforts, but also bemoaned recent changes.

Their current situation is similar to that in Taiwan when they left in the 1980s: shortages of labor, water, and electricity. What's more, immense upward pressure on the Renminbi has attracted large speculative inflows of foreign currency, pushing up prices and whittling away at the already narrow profit margins of the export industries.

The IT industry, with its superior financial and technological clout, has been flooding into the Yangtze Delta over the past few years. In contrast, Taiwanese businesses in Guangdong are mainly traditional-industry SMEs that might not make it into the new high-tech industrial parks in Shanghai and Suzhou, but by their sheer numbers, flexibility and adaptability, shouldn't find it difficult to remain movers and shakers in the Guangdong region over the next five years.

Worthy of note are PRC government ambitions. Not long ago, the Guangdong government launched plans for a "pan-Pearl-River economic circle," with the slogan "9+2" (nine provinces, plus Hong Kong and Macao, that are linked by the Pearl River), by which it hopes to further integrate South China's economic resources. Shanghai, the undisputed leader of the Yangtze Delta, has not been resting on its laurels either. It has set up the "Golden Waterway League," stretching the frontline of the battle between these two deltas all the way to Xinjiang at the Yangtze's upper reaches. The battle has just begun, but will Taiwanese firms find themselves pushed to the sidelines and unnoticed? Or will they find new life? We'll have to wait and see.

Located next to Guangdong, Jiangxi Province has also been busy lately, calling on Taiwanese firms to "gradually relocate." Many businesspeople have been invited to inspect Jiangxi's capital city, Nanchang. It will be worth watching whether Nanchang will become a second Dongguan, attracting its own wave of Taiwanese investment.

With a relative dearth in Taiwan of news about the lives of the hundreds of thousands of Taiwanese businesspeople who have left to toil abroad, Lee has brought back reports from those in Guangdong, including the status of the Dongguan Taiwanese School, both to encourage them in their endeavors and to remind them to return home once they've made their mark.