Zhongshan Mayor Li Qihong believes environmentally-friendly companies are crucial for development.

"New energy is the future focus. We've put 300 million yuan aside to develop new energy projects," she said.

Zhongshan municipality is not only encouraging the development of green companies, but is also encouraging the central government's policy of forming clusters. By creating economic industrial clusters, small startup companies are able to cut costs without cutting innovation. Zhongshan's Torch Development Zone, a special region in which enterprises focus on strengthening technological design, is starting to reap the benefits of the stimulus package.

"Almost all industries have almost completely stopped slowing down," said Feng Shusheng, secretary of the Torch Development Zone Committee.

In fact, some businesses have found themselves suddenly ahead of the game. Unihero, an incubator company that lies in a special economic zone in Huizhou, pays only one yuan in rent. It creates lighting equipment displays and provides lighting engineering solutions. By receiving real estate and tax benefits, it has been able to invest the extra cash in new ways. The result is that 30 percent of its appliance sales and R&D employment are now being funneled into the LED market. Frankie Yi, the marketing director of the company, says that by upgrading its investment strategies, infrastructure has boomed and the domestic market is now replacing the loss of exports.

But that's not to say Chinese businesses are not treading any waves in the global economic turmoil. Zhongshan Executive Vice Mayor Xie Zhongfan, notes that while the central government has successfully created policies to boost domestic production, it's hard to shift reliance on exports to domestic sales. Yu agrees. Despite the record sales Galanz has achieved by tapping into the domestic and emerging markets, consumption levels remain highest in Europe and North America.

"We have taken some active measures, entering 139 new markets around the world. Most are new, emerging markets…but they can't replace the European and North American markets," Yu said.

Furthermore, the factories that did shut down at the beginning of the crisis are still creating ripples in the local economies. As employment levels dropped as much as 20 percent in some areas, many of the workers who lost their jobs were forced to move and find jobs elsewhere.

"The government has taken measures to help cut risks for businesses… [but] there's still a long way to go," said Xie.

While Xie is smart to point out that the crisis is not over, the region seems to have found a calm spot in the storm. And while the rest of the world continues to struggle to stay afloat in the current bearish market, the dragon, at least for now, is proving that it runs the lair.

(China.org.cn by Susan Tart August 25, 2009)