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Ghost towns arise from rash urbanization

China’s urbanization is at such an impasse that even People’s Daily weighed in on where it went wrong.

In an editorial published on August 28, the Party newspaper opined that it is unsettling to see many Chinese cities building or planning to build satellite cities.

The newspaper cited a recent survey by the National Development and Reform Commission, the top economic planning body, which found that of all the 12 provinces polled, 144 county-level cities plan to build more than 200 new towns in the future, averaging 1.5 new towns per city. And for the provincial capitals, the ambitions can only be bolder. Each of them is considering producing 4.6 new towns on average.

Add to those figures the existing blueprints of capital cities aspiring to  “global metropolis status,” as well as recurrent media coverage of “ghost towns,” and people are naturally wondering where is this new town frenzy leading us?

It is a concern real, profound and familiar. Recent history is strewn with failures of bad urban planning. One such failure is Erdos, the city that is spread out on the Inner Mongolian Autonomous Region steppe and boasts a large coal reserve.

Despite the sheer number and scale of its immense squares, residential building blocks, and other urban amenities, it lacks the crucial component of city life: people. There are so few residents and Erdos is eerily silent at night.

Media reports blamed the birth of Erdos and a few other ghost towns on real estate speculators looking to cash in on a housing boom. When that boom turned to bust, due to a slew of credit tightening measures, it was almost like Armageddon.

In early 2012, property developers went bankrupt one after another in Erdos. Millionaires pawned their limousines for some urgently needed liquidity. Erdos ended up as a monument to the fatal mix of poor planning and misinformed investments.

Lessons forgotten

It was then hoped that future planners will learn from past mistakes. But the reality is that warnings against reckless urban sprawl are already behind us and whatever lessons learned the hard way are quickly forgotten.

As a result of this amnesia, city authorities appear to be hitting the gas, not the brakes, in a movement to churn out satellite towns.

According to a report by China National Radio, Changzhou, a city in Jiangsu Province, has become a new victim to this movement. As a traditional “hometown of fish and rice,” a supposed attraction, Changzhou’s new town has received few immigrants.

A big reason is that many of the 1.7 million migrants in Changzhou cannot afford a home. So rows upon rows of apartment buildings erected in its new town languish unsold — and will likely remain so for some time.

When market demand is far outstripped by supply, the results are obvious: a crash in home prices, an anemic property market, and wanton waste of resources.

But in their fetish about the value of anything larger, grander and more GDP-friendly, many local authorities have cast aside basic economic rules and fundamental concern about wasteful construction. According to Wu Jiang, vice president of Tongji University of Shanghai, urban development must accord with market principles, such as where there is demand, there arises a need to fill it with new building, a home, a square or an industrial park.

However, right now some officials are hell-bent on promising cheap land — or indeed, free land — in return for investments to drive local growth. What’s happened as a result is often that “culture-themed industry parks” crop up, only to be vacated and abandoned after a few years. Some “parks,” as we know now, are actually a ploy to hog land in anticipation of future appreciation in land value.

Wu, who is also the president of UNEP-Tongji Institute of Environment for Sustainable Development, told Shanghai Daily on Wednesday that new towns must offer all the amenities available in city centers, like companies, schools, shopping malls, hospitals and recreational facilities. Otherwise, there will be a lot of unnecessary commutings between home and work.

The far-flung residential quarters new town dwellers call home risk becoming just the same sort of bedroom communities that Western countries once had, Wu said.

It is reported recently that a few exotic foreign copycat towns in Shanghai’s suburbs are favored by couples taking wedding photos but are devoid of human activity at night. Wu noted that these new towns were attractive at the beginning because of cheaper homes, but soon all kinds of problems arose that diminished their appeal: lack of public transport, recreation, shopping destinations, and other necessities.

So for many ghost towns to shake off their unpleasant reputation, the focus is now on making them multi-functional, by establishing an industry or multiple industries within them, where people can be employed close by, argued Wu.

The danger of erecting ghost towns also lies in the reckless and risky borrowing by local governments, who could be left holding the bag if loans turn sour, Yin Zhi, professor of architecture at Tsinghua University, was quoted as saying on Wednesday.

Some officials thus should sober up to the financial complications should their pet project go awry. Besides, what’s the point of building homes that are left vacant and white elephants that only remind us of the Erdos fiasco?

Cheng zhen hua

China’s central leadership has reiterated that urbanization of people is central to the new type of urbanization called cheng zhen hua. That means bestowing on the new arrivals their coveted hukou, or household residency, entitling them to basic benefits.

While there are deep concerns among some urbanites about the impact on their social benefits of an influx of immigrant, vice president Wu Jiang of Tongji University called for an open mind. “Of course a huge influx (of migrants) will stretch the city’s welfare system. But we need to open our arms to those who contribute to their adopted cities,” he told Shanghai Daily. “That said, there is a need for policy makers to mandate a certain threshold, not diplomas or certificates necessarily, but contributions.”

Wu cited the example of Hong Kong, where people must stay for at least seven consecutive years to be granted citizenship. The seven-year requirement is an indication that the particular person has continuously paid taxes and felt attached to Hong Kong. This is grounds for his or her entitlement to local pension or other social welfare schemes. Shanghai and Beijing need something likewise, he said.

Like it or not, the ongoing debate on easing the rigid hukou is a sign that urbanization is on the right track, for officials have to mull constructing more hospitals, schools, kindergartens and nursing homes, which everyone needs, rather than the many fancy monstrosities that do little more than flatter their vanity — and increasingly only theirs.

 


 

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