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Is China's Latest Major Construction Project Destined to Be a Ghost Town?

The Xiongan New Area has been positioned as the cure for Beijing’s rising sprawl and congestion. But will it really be a workable solution, or just a new host to existing problems?

A man wearing a respirator walks toward an office building amid smog in Beijing.
A man wearing a respirator walks toward an office building amid smog in Beijing. (Jason Lee/Reuters)

For the 22 million residents of Beijing, the Chinese government’s latest announcement may come as a literal breath of fresh air. In April, the Communist party’s top leaders unveiled plans to create a new city just south of the country’s capital. The Xiongan New Area, a designated special economic zone, is being hailed by state media as a model for urbanization and a potential cure for Beijing’s urban sprawl. According to China’s official news agency, Xinhua, the city is reflective of “a new chapter” in the country, and will relieve the capital’s rising pollution level and car-choked traffic.

A joint statement released by the country’s two most powerful political bodies, the state council and the central committee, sees the new city as “a strategy crucial for a millennium to come.” The proposed city will stretch across three counties. Though details are scarce, early plans suggest it will be three times the size of New York City.

There’s not yet a concrete design plan, but according to an estimate from Morgan Stanley, investment in infrastructure and relocation will run about $290 billion (2 trillion yuan) over the first 15 years, and possibly lure around 6.7 million people to the area. While the potential to gain from a venture of this size is huge, it’s also reasonable to question whether Xiongan will be a workable solution, or if it will just be a new host to existing problems.

This is not a first-time venture for China: thriving areas like Shenzen and Shanghai Pudong were born out of similar strategies in the 1980s and ‘90s. Prime location was one of the reasons for their success, says David Dollar, a senior fellow at the China Center at the Brookings Institution. Shenzen is on the border of Hong Kong, while Pudong is right across the river from downtown Shanghai. Most successful cities, Dollar says, have geographic advantages, such as being located on the coast. For that reason, he’s a little skeptical about Xiongan. “The new city is completely land-locked, with no obvious geographic reason to put a city there,” he says. “It’s an odd choice.”

Many efforts to construct new cities have left behind a trail of ghost towns in China. For example, the city of Kangbashi currently houses a 100,000 residents, when it was meant to attract more than 500,000. In 2013, when the city of Yujiapu was being developed, it evoked images of a Manhattan-like skyline. A year later, investors started to pull out. Construction came to a halt and left Yujiapu with a few half-finished skyscrapers.

How likely is Xiongan to meet the same fate? “This plan has got too much public backing for that to happen here—it won’t be a new Beijing, but think of it like its stepchild,” says Thomas J. Campanella, who authored a book on China’s urban revolution and is a professor at Cornell University’s department of regional and city planning. But Dollar disagrees, saying that “the heavy government backing doesn’t necessarily make it immune from becoming a ghost town if it doesn’t address other inherent urban planning challenges.”

One of those challenges is whether the new city will be able to become an innovation hub, as local authorities predict. “We’ll have to see if Xiongan will [be] equipped with services like schools and universities, or if those services will be relocated from Beijing—neither is easy, so I’m unsure about how it will be a practical success,” Dollar says.

It’s also unclear whether the new city will truly alleviate the pollution problem. Dollar points out that some of Beijing’s air pollution isn’t from the city itself, but from heavily industrial regions nearby—including the Hebei province, where part of the new city will be located. “If part of the plan is to encourage those plants to shut down and relocate, that could improve air quality in Beijing,” he says. “Otherwise, it could just carry on the problem.”

Importantly, Beijing’s car problem will most likely continue to persist, according to Campanella. “If Beijing itself doesn’t act aggressively to control its automobile numbers, they will still have problems in the city center,” he says. Around the capital city, sprawl has outstripped the building of public transit—“it has forced a lot [of residents] to buy cars and adopt a motor-dependent lifestyle,” Campanella says. The rate of car purchases in Beijing has only increased—there are currently 5 million automobiles in the city—despite policies that aim to restrict driving on certain roads or when pollution is especially pronounced.

Dollar thinks the heavy investment in the new area should be redirected inward, to work to fix the larger problems of car-dependency and heavy industry. “Most of the big cities in China could use better design, focusing on more public transport. If you took money away from expressways used by cars and put more into the bus service and subway system, that would be a good use of investment,” he says. Campanella agrees, saying more can be done in Beijing to accommodate residents in a smart and sustainable way. “I don’t know why the government has decided to build from scratch,” he says.

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