Build it, and they will come. Except, probably not when ‘it’ is a giant development that will cost an estimated 22 billion yuan to build and involve flattening 700 mountains.
The Lanzhou New Area, a 500 square mile zone 50 miles from the provincial capital of Gansu province, will increase the region’s GDP to 270 billion yuan by 2030 according to developers and state media. The project is intended to be China’s fifth “state level development zone”, alongside Pudong and Tianjin’s Binhai. However, unlike those cities, which were already major trading ports and industrial hotspots, Lanzhou is a comparatively tiny city by Chinese standards, home to a mere 3.6 million people.
Lanzhou, situated alongside the Yellow River, already has major environmental concerns. The World Health Organisation named it the city with the worst air pollution in China in 2011, which, as residents of Shanghai or Beijing can tell you, is a pretty competitive field. Lanzhou’s main industries are textiles, fertiliser production and metallurgy.
Liu Fuyuan, previously a top official at the Chinese National Development and Reform Commission, told the China Economic Weekly that the project was unsustainable in one of China’s most chronically water-scarce areas. Other critics, including economic professor Tao Ran of Renmin University, said that the financial risks of building the city were very high. “All this investment needs to be paid back with residential land revenue, and I don’t see much on returns in these kinds of cities,” said Tao. “If you have a booming real estate market it might work, but it seems to me that real estate in China is very, very risky.”
China is spotted with ambitious developments which never went anywhere, motivated by officials’ desire for prestige more than any actual demand. Chenggong, built as a satellite for Kunming, the capital of Yunnan Province, failed to attract residents or industry. Holly Krambeck of the World Bank said in 2011 that the city had “over 100,000” empty apartments. The New South China Mall is perhaps the premier example of impressive sounding projects that completely fell on their faces commercially. The Mall, one of the world’s biggest, opened in 2005 on the outskirts of Dongguan in Guangdong Province, but the majority of its 1,500 stores remain empty.