China's strict protected area policy promotes industrial restructuring and ecological efficiency improvement.

Policy Tightening Drives Industrial Restructuring

Since 2013, China has strengthened its network of protected areas and ecological conservation redlines, linking ecological performance with official promotion through central environmental inspections. This policy shift has not only eliminated high-pollution enterprises but also triggered deep adjustments in the industrial structure of surrounding areas. According to a recent study published in *Communications Sustainability*, an analysis of over 50 million enterprise records from 6,638 protected areas and their surrounding regions between 2000 and 2020 shows a significant positive correlation between policy stringency and the intensity of industrial entry and exit.

Industrial Relocation Pathways and Resource Endowments

The study finds that the direction of enterprise relocation around protected areas is highly dependent on local resource endowments. Regions with tourism resources are more likely to attract green industries such as ecotourism and specialty agriculture, creating a "gateway community" effect. These newly entering enterprises typically bring higher ecosystem service values (ESV), particularly in water conservation and biodiversity maintenance. However, the exit of certain industries (such as high-water-consumption or high-pollution sectors) may lead to a decline in soil conservation capacity, even if it improves the local environment, resulting in local trade-offs.

Implications for Manufacturing in a Global Context

China's practices provide an important reference for developing countries. Environmental regulations do not simply "drive away" industries; rather, they promote a restructuring of industries toward greater sustainability. This "advancing by retreating" transformation model aligns with the global manufacturing trend of "green supply chains." Enterprises are forced to reassess location choices, shifting from a sole focus on cost minimization to balancing environmental compliance and brand value. In this process, the key to policy design lies in providing alternative livelihood support, such as subsidies and tax incentives for eco-friendly enterprises, to avoid industrial hollowing out.

Dynamic Balance Between Ecological Benefits and Economy

The study confirms that strict protection policies coexist with improvements in ecosystem service value, but the relationship is not linear. Both enterprise entry and exit are components of structural adjustment: entering enterprises typically generate higher ecological benefits, while exiting enterprises, though freeing up environmental capacity, may impact local employment and tax revenue. Therefore, policies should focus on the "quality" rather than the sheer "quantity" of industrial transformation. For example, directing financial resources toward green, technology-intensive industries while providing retraining for affected workers.

Long-Term Trend Assessment

Over a longer timeframe, China's protected area policies are reshaping the regional industrial geography. With the advancement of the "dual carbon" goals, similar environmental regulations will spread across more countries. Manufacturing enterprises need to position themselves in advance: on one hand, transitioning toward service-oriented and greener models becomes inevitable; on the other hand, the regional reorganization of supply chains (e.g., relocating to areas with lower environmental standards) may face increasing policy resistance. In the future, the core of industrial competition will no longer be solely cost, but the ability to coexist with nature.