-----Original Message-----
From: David Sadoway [mailto:[email protected]] 
Sent: Thursday, March 29, 2012 12:22 AM
To: michael gurstein
Subject: follow-up on 'ghost cities' in PRC

The right mix

Helena Fu believes the ghost towns spawned by China's property bubble can be
brought to life but government officials need to focus on jobs, transport
links, the environment and community spirit

Mar 29, 2012


China's massive property construction boom has caught the attention of the
world. Ghost towns of empty houses point to over investment on a massive
scale. Nationwide, there are 2.9 billion square metres of residential
property under construction, enough to satisfy demand for the next three
years without a single extra flat being built. That's a scary number.
Pessimists point to the overhang of unsold property as evidence of a coming
collapse in the country's property sector. The reality, though, is that many
of the cities that currently stand empty can still succeed if the government
puts the right policies in place

What separates thriving new urban centres from the desolate concrete
wastelands is success or failure in four key policy areas: jobs, transport,
environment and community.

Most important: jobs. Simply put, does the town generate the employment
opportunities necessary to attract new residents? Take Ordos , home of
China's most notorious ghost town, which has sprung up in the Inner
Mongolian desert. The local coal mining industry has made the city rich -
with one of the highest gross domestic products per capita anywhere on the
mainland. But mining does not create employment opportunities for a middle
class that could buy Ordos' empty flats.

For evidence, look no further than the population numbers. Despite the
growing wealth generated by digging up coal, Ordos' population has changed
little in the past five years. That stands in stark contrast to Shanghai's
Pudong district, where a job-creating services sector has attracted millions
of new residents, helping turn a ghost town 20 years ago into a thriving
financial centre today.

Location, location, location is the watchword for house-hunters, and its
equally important for new towns. There's a reason global cities like London,
Hong Kong and New York thrived - a location on a natural port that provides
easy transport links to other markets.

Location and transport links also matter for China's ghost towns. Chenggong
- a district in Kunming , in south central China - is currently an empty
suburb. But plans to connect it to central Kunming through a light rail
network this year, and to Shanghai by high-speed rail by 2015 will provide
the transport links to turn that situation around.

Underpinning the success of cities is environmental sustainability. In
China, one of the main constraints is water. At least 75 golf courses built
on the arid plains around Beijing are banking on attracting the capital's
new rich to their lush green slopes. But with water in China scarcer than in
Israel, such a water-intensive development strategy cannot succeed in the
long term.

More successful will be places like Nanhai district in Foshan , Guangdong
province. Nanhai doesn't suffer from lack of water, indeed it is in a region
prone to floods. But, a design that guards against that risk means the city
is working with, rather than against, the local environmental constraints.

Community also matters. No one will bring their family to a town with no
schools or hospitals. Cohesive neighbourhoods, street life, green spaces and
bustling restaurants are important. Mega blocks, eight-lane intersections
and monumental architecture make many of China's ghost towns look good on
the drawing board. But, they lack the warmth and community life to attract -
and retain - residents.

Ningbo in Zhejiang province is an example of how to do it better. Ningbo is
upgrading urban infrastructure while also conserving and revitalising
cultural heritage - the historic sites and neighbourhoods that draw people
together and give a sense of place. At the city's new waterfront the typical
high-rise luxury flats are there, but so too are restored historic sites and
public amenities that draw people to the water.

Jobs, transport, environment and community - these are the building blocks
of successful cities. The bad news is that, as they are, many of China's
ghost towns are missing all of them. The good news is that the experience of
Pudong, Chenggong, Nanhai and Ningbo shows that some local governments get
what is required, and some cities have the potential for change.

Policies that bring job-creating businesses to town, put transport links in
place and encourage people to use them, and build the soft infrastructure of
community life are all tough to realise. But they are doable. Building the
houses was the easy part. If China wants to turn its ghost towns into
thriving centres, officials need to put the other building blocks in place.

Helena Fu is a director at AECOM's China Sustainability Centre, which
provides innovative policy, strategy and planning solutions to China's
development challenges=


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