The second such period followed Deng Xiaoping’s southern tour in 1992, during which he emphasized the need to shift to a market-based – albeit state-controlled – system by opening China’s economy to foreign direct investment and establishing special economic zones to help develop export-oriented industries. This time, TFP growth soared to 5-6%, partly owing to the “catching up” process facilitated by China’s adoption of foreign technology and know-how.