What Will Become Of China's Ghost Cities?
Little did we know that most of that iron ore being shipped to Guangzhou from Rio de Janeiro and Port Hedland, Australia was going to build Chinese cities; cities that would remain vacant for years. China single-handedly topped the phrase “bridge to nowhere” and made ghost cities a euphemism for lousy development planning in the world’s No. 2 economy. Anyone can build a useless overpass, but it takes China to build a city for a million people with no buyers in sight.
The naysayers loved the Western media’s discovery of China’s ghost cities. It was evidence that China’s growth of the last 20 years was based on building things nobody needed or wanted. This was planned obsolescence on a grand scale. And now that the economy is slowing, what will become of those cities? Many of them are debt burdens carried by the developers who haven’t sold a single unit.
From shopping malls to soccer stadiums, hundreds of new cities in China are largely empty. And yet more cities are still being built deep in the heart of the country. All in hopes that its rural population will one day move to a flat in a city without a mayor. It’s plausible, of course. That’s because over the next 15 years, the country’s urban population will be 1 billion; three times that of the United States.
Kangbashi New Area, the Mongolian area city that put China ghost cities on the map. (Photo by Wade Shepard)
What will become of these cities going forward? Here’s a quick answer: a handful might be shuttered. Most will be filled. New ones will undoubtedly be built.
China’s developing its urban architecture three ways: new cities (xinshi), new districts (xinqu) and the so-called townification (chengzhenhua). Townification is quite a departure from the way Chinese cities have developed to date. This is the transformation of small rural centers and even tribal villages and building a small urban center around them. The Communist Party planners in Beijing want to urbanize over 100 million rural Chinese over the next five years alone. That would require the construction of 50 Bostons, or six Shanghais, by 2020. Townification is lower intensity than that. These are small cities rather than sky scraper zones designed to house suits and high heels. It’s more widespread than traditional urbanization, and will define the way China develops socio-economically over the coming years.
Roughly 40% of the 300 million Chinese expected to move into a city by 2030 will mostly be moving to smaller cities in the “chengzhenhua” system. Rather than migrating to cities, the cities will be built around them instead.
Tattoed hipster and Silk Road traveling journalist Wade Shepard calls this the largest social experiment that has played out in human history. Shepard is the author of
a readable explanation of what’s going down in China’s new downtowns.
China’s continued urbanization push can be viewed as a full-on effort to develop an insulated economy that’s based on domestic production delivering goods and services to domestic consumers. Past crises in Europe and the U.S. have taken their toll on the Chinese economy. During the U.S. Great Recession, China had to bail out the economy to the tune of nearly a trillion dollars. Its GDP fell below 7%. It was, alas, the hard landing the popular pundits had been waiting for. To curb the impact that foreign financial meltdowns can have, China has performed a U-turn and is now looking inward. In 2013, the service economy topped manufacturing for the first time. City building goes along with this.
Not every new city or urban expansion project will succeed. Some will fail and become true ghost towns, the kind that remind us Westerners of cowboy lore, complete with Gobi desert tumbleweeds. But to measure the vitality of this ambitious project, one needs to counterbalance failures with successes, Shepard reminds us. By focusing on the extreme and often confusing aspects of China’s urbanization movement, the real China story gets lost in the noise. Although the past is not indicative of the future, let us not forget that this country pulled more people out of dollar-a-day poverty than any other country. Many of those riches came from building new cities. In the last two decades, China has built an entirely new country, one that matters to Apple as much as the U.S.; a country whose businesses own American brands like AMC Theaters, and are building high rises in Los Angeles.
It's a pretty long article, that's why I didn't quote all of it word for word.
