To a Westerner the pace of change throughout China is astonishing. New expressways and high-speed railways snake across the country; towering apartment blocks rise in clusters; rivers are diverted and man-made waterways created. And virtually all of this frenzied activity is the product of the last few years.
Perhaps most impressive is the creation of completely new cities and towns. As an example Shanyin County, located in the north of China’s Shanxi Province, has been undertaking this type of exercise, but rather than creating a completely new town Shanyin County is in the process of transplanting an old town.
Downtown Shanyin looks very tired and grotty but its emerging replacement, Sanggan River New District, reflects what can be achieved when town planners are able to work with a blank canvas, a greenfields site. This enables a comprehensive and logical approach to urban regeneration. The process of developing a new town is not compromised by having to build around existing buildings or carrying out construction work while the normal chaos of urban activity goes on.
What Shanyin County has been able to do is create a model town or district where wide avenues and expansive squares separate the new headquarters of the County government, elegant commercial buildings, five-star hotel accommodation and lofty apartment towers. The timing of construction was extremely fortunate because in July the Central Government introduced a five-year ban on the construction of new government buildings throughout China as part of a national frugality campaign. This means that other counties will not be able to emulate Shanyin County’s initiative in urban renewal.
In August the Government of Shanyin County announced a five part strategy to accelerate “the key projects of urban construction represented by Sanggan River New District”:
- 1. Carry out follow-up projects relating to the New District including the building of new roads, bridges and squares.
- 2. Accelerate the renewal and upgrading of the old town.
- 3. Speed up the expansion of “ecological greening projects” such as mass tree planting along County roads and the development of extensive wetlands designed to encourage and protect local fauna.
- 4. Speed up the construction of indemnificatory or low cost, subsidised housing. “The Government is going to further promote the construction of low-rent housing, economically affordable housing, low-cost commercial residential housing, public rental housing, as well as the renewal of dilapidated houses in rural areas embodying seismic resistant construction technology.”
- 5. Accelerate small town construction. “Bringing the surrounding towns and villages into the general plan of the whole County, the Government is going to further enhance the infrastructure construction and stimulate the impetus of the urban neighbouring areas.”
Implications for Australian companies
The construction of Sanggan River New District is very much in accord with the Central Government’s policy of promoting increasing urbanisation. However, massive expenditure on physical improvements – on infrastructure, commercial buildings and new housing – could cause more harm than benefit to the national economy unless it is accompanied by increased employment opportunities and incomes.
One major problem is that many rural residents are not really productively employed and exist on incomes that are barely at subsistence level. In 2012 urban incomes in Shanxi Province were 3.2 times that of rural incomes. Merely shifting people into modern urban accommodation doesn’t begin to bridge that gap. What is needed are increased opportunities for truly productive employment. Chinese counties have a great need for Australian technology and expertise, and in general they are prepared to offer very attractive incentives to our companies to establish operations there.
Shanyin County has a population of around 230,000, but its province Shanxi has 35 million inhabitants. Together with the immediately adjacent Tier 3 provinces of Inner Mongolia, Shaanxi and Henan there are about 200 million people who are potential consumers for the products or services that the companies provide.
Bruce Ross Consulting can offer introductions, support and guidance for companies wishing to take advantage of the abundant opportunities in Shanyin County or other counties or cities in Shanxi Province.
See also on Shanyin County: