New Geography

Tag: China

  • Rise of the Hans

    When Chinese President Hu Jintao comes to Washington this week, there aren’t likely to be many surprises: Hu and Barack Obama will probably keep their conversation to a fairly regulated script, focusing on trade and North Korea and offering the expected viewpoints on both. But seen from a different angle, everything in that conversation could be predicted, not from current events but from longstanding tribal patterns.

    With China’s new prominence in global affairs, the Han race, which constitutes 90 percent of the Chinese population, is suddenly the most dominant cohesive ethnic group in the world — and it is seeking to remain that way through strategic alliances, aggressive trade policy, and attacks on racial minorities within the country’s boundaries. The less tribally cohesive, more fragmented West is, meanwhile, losing out.

    Almost 20 years ago, I wrote a book called Tribes that sought to trace the role of ethnicity, race, and religion in economic and geopolitical affairs. At the time, there was some skepticism about the continuing influence of ethnicity; some considered the work, frankly, regressive and racist. Now, however, my thesis from 1992 has really come to fruition. We are living in the age of tribes — and China is just the start.

    Such primitive racial instincts were supposed to be long ago passé: We’re supposed to be living in Thomas Friedman’s “flat” world or Kenichi Ohmae’s “borderless world.” By now, supposedly, everyone is increasingly interconnected and undifferentiated. Affairs should be managed neatly by deracinated professionals, working on their iPads from Brussels, Washington, or any of the other “global” capitals.

    But most people do not really see themselves as members of a large multinational unit, global citizens, or “mass consumers.” Instead the drivers of history remain the essentials: the desire to feed one’s family, support the health of the tribe, and shape the immediate community. The particularistic continues to trump the universalistic.

    This has only become more evident as our world becomes more multipolar. During the 19th and much of the 20th century, the world was dominated by a European capitalist mindset that glossed over many of the ethnic and racial differences simmering under the surface in the regions under its rule. Particular groups, including Chinese, Muslims, or Hindu Indians, might have harbored a sense of unique identity but, for the most part, either melded into the Euro-American mold, or, after the Russian Revolution of 1917, into the alternative Soviet one.

    Today this has changed dramatically, as once suppressed racial and ethnic groups express their power on a global level. The rise of Chinese national identity, increasingly stripped of its socialist clothing, must be seen as the driving force behind the new tribalism. The country’s re-emergence as a great world power expresses the cultural ascendency not so much of Marxism or Maoism but of the Han race, which in only a few decades could control the world’s largest economy.

    This represents a major shift in the identity of the Chinese tribe, a combination of political and economic power with a very homogeneous worldview. The best way to explain China’s economic and foreign policy is most accurately seen as a tribal expression of what Friedrich Nietzsche called a “will to power.” Essentially, the Han has become a tribal superpower that treats other groups — from China’s non-Han minority to much of the rest of the world — as a vast semi-colonial periphery. And with its growing economic and military might, Han China may soon be able to impose its will on some of these “lesser” cultures, should it desire.

    China may be setting the underlying tone of our new world, but many other groups have responded in similarly tribal fashion. Like China, Russia has abandoned internationalist communism for a kind of Leninist state-capitalism with racial overtones, as evident both in the increasingly rough treatments of darker-skinned ethnic minorities such as Chechens and an aggressive ethnic Russian retro-imperialism — once disguised in socialist trappings — toward “near abroad” countries like Georgia, Armenia, Ukraine, and Belarus.

    The state-sponsored restoration of everything from the Orthodox Church to Stalin — as well as the consolidation of state ownership over the lucrative energy sector — reflects the deeply nationalist core of the modern Russian state, which, for historical, geographical, and cultural reasons, has, with few exceptions, always bent toward authoritarianism. The end of the Soviet Union, it turns out, did not usher in a wider embrace of universal capitalism so much as engender various forms of ethnicity-based irredentism and, in Russia itself, a renewed Slavic nationalism.

    As they have modernized and globalized, other races — Persians, Arabs, Brazilians, for just a few examples — have turned out to be far less cosmopolitan and more tribal. These nationalisms, or tribalisms vary widely. Some, like China and Russia, are specifically racial in character. Others, such as Brazil, are remarkably multi-racial. In some cases historic resentments are at the base. But all are less interested in adopting globalized norms of free markets or capitalism than using state power (through sovereign wealth funds and state-controlled corporations) to increase their influence and wealth.

    The new tribalism is also increasingly evident in Europe. Just a few years ago Europhiles like French eminence grise Jacques Attali or left-wing author Jeremy Rifkin could project a utopian future European Union that would stand both as a global role model and one of the world’s great powers. Today, Rifkin’s ideal of a universalistic “European dream” is collapsing — a process accelerated by the financial crisis — as the continent is torn apart by deep-seated historical and cultural rifts.

    Europe today can best be seen as divided between three cultural tribes: Nordic-Germanic, Latin, and Slavonic. In the north, there is a vast region of prosperity, a zone of Nordic dynamism. Characterized by economies based on specialized exports, a still powerful Protestant ethic, and a culture that embraces authority, these countries — including Scandinavia, the Netherlands, Germany, and, arguably, the Baltic states — are becoming ever more aware of the cultural, fiscal, and attitudinal gulf between them and the southern countries.

    At the same time, the attempt to build a new European identity fused with immigrants appears to be failing. As Chancellor Angela Merkel noted, Germany has failed at “multi-culturalism.” Such sentiments may be reviled by the media, academics, and even business leaders in Northern Europe, but they are clearly popular at the grassroots. Once considered paragons of liberalism, countries such as Denmark and the Netherlands have incubated potent anti-immigration movements.

    In a world dominated increasingly by Asia, northern Europe cannot be anything more than a peripheral global power, which may explain its new introversion. Instead these resilient cultures more accurately represent a revival of the old Hanseatic League, a network of opportunistic and prosperous trading states that ringed the North and Baltic seas during the 13th century. This new league increasingly battles over issues of trade and fiscal policy, often with ill-disguised contempt, with the southern European countries I call “the Olive Republics”: a region typified by dire straits, with rapidly aging populations, enormous budget deficits, and declining industrial might. Southern Europe now constitutes a zone of lassitude that extends from Portugal and Spain through the south of France, Italy, the former Yugoslavia, Greece, and Bulgaria.

    The last European tribe includes the Slavic countries, centered by Russia but extending to parts of the Balkans as well, places like Ukraine, Belarus, Serbia, and Moldova that historically have looked east as well as west and are currently defined by shrinking populations and weak democratic institutions. A historic pattern of Russian domination is evident here, based in large part on a revived Slavic identity that embraces similarities in religion, culture, history, and language with countries living under Russia’s shield. In this sense the czars are back, not a great development for the rest of the world or for the fading chimera of a “common European home.”

    What does this resurgence of tribalism mean to the foreign policy community? Clearly more attention needs to be played to such issues as cultural vibrancy, birthrates, and economic “animal spirits.” In some sense, we need to return to the perspectives of ancient writers like Herodotus and Ibn Khaldun, who attributed the rise and fall of nations to the vitality of what the latter called “group feeling.”

    Tribalism will also threaten the efficacy of international organizations, which tend to assume common interests between groups. Instead we have to think of future international cooperation in more traditional terms, balancing distinct sets of tribal interest. As tribes continue to pursue their own interests ever more zealously, the idealistic rhetoric of multinational organizations will become ever more risible. The way China and other developing countries snarled up the Copenhagen climate conference reflects this shift.

    Similarly, the problems with controlling trade to Iran have to do with long-standing economic relationships that are closely linked to cultural ties. Sanctions imposed from the West cannot compete with far more long-standing trade relations between Iran and places like Dubai. In the future, the best hope may lie in more temporary, ad hoc alliances based on the self-interest of individual tribes, such as how the U.S. and Russia may cooperate in space exploration as a means to preserve their hegemony in that field against newcomers such as China.

    In essence, we need to shift from seeking labored, politically correct commonalities among cultures and work more on learning to reconcile and co-exist with people who always, inevitably, will remain strangers. This means, for example, throwing out the idea that any international model — say, the Anglo-American version — can be imposed or grafted onto other cultures.

    “What about us?” Anglo-Americans may ask. In a globalized world that speaks and writes in English, the Anglosphere retains some natural advantages. This is where the most elite colleges and universities are located, and where the top financial firms are concentrated. Equally important, the Anglosphere also controls much of what the developing countries will most need in the future — food — through the unsurpassed fecundity of the United States, Canada, Australia, and New Zealand.

    Demographics and a unique ability to absorb a wide range of immigrants make the Anglosphere economically and demographically vibrant — a point often missed by political scientists like the late Samuel Huntington and some elements on the political right. By 2050, the Anglosphere will be home to upwards of 550 million people, the largest population grouping outside China and India. English-speakers may not straddle the world like the 19th century empire-makers, but they are likely to remain first among equals well into the current century.

    Ultimately, this will depend on how the English-speaking world evolves and learns to embrace its multiracial population without losing its sense of a common identity. Ideally, the Anglosphere can offer an alternative that embraces not merely a language but a set of historically achieved values such as democracy and freedom of speech, religion, and markets. Already many of the English-speaking world’s exemplary writers, artists, industrialists, and entrepreneurs hail from a vast and ever expanding array of backgrounds. It is in the melding of many into one dynamic culture that the Anglosphere may retain a powerful influence over our emerging world of tribes.

    This piece originally appeared in Foreign Policy.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University, and an adjunct fellow of the Legatum Institute in London. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

    Photo Peter Fuchs

  • The Dispersing of Urbanism

    For more than a century, people have been moving by the millions to larger urban areas from smaller urban areas and rural areas. Within the last five years, the share of the world population living in rural areas has dropped below one-half for the first time. The migration to the larger urban areas has spread to lower income nations as the countryside seemingly empties into places like Chongqing, Jakarta and Delhi. In the United States, the rural population has declined from slightly more than 60% in 1900 to approximately 18% in 2010. In Australia, the rural population is expected to decline to below 10% later in this decade.

    Of course, the driving factor in this urban migration is the quest for opportunity. People have flocked to urban areas because opportunities are greater.

    Yet if the opportunities are in metropolitan areas, indications are that this is taking place over a wider area than in the past. A review of income growth between 2001 and 2006 in four nations shows that incomes rose more in some surrounding regions than within the metropolitan areas, at least during the first half of the decade. It will be interesting to see if these patterns have changed in the second half of the decade, something we will be able to discern once the 2010/2011 round of census data is available.

    Australia

    This dispersion of opportunity is particularly evident in Australia, where data from the last two national censuses indicates that incomes overall have risen more quickly outside some major metropolitan areas. In three of five cases (the three largest) incomes rose higher outside rather than inside the major metropolitan areas (Figure 1).

    • In Sydney, the largest metropolitan area in Australia, median household incomes declined 6.6% relative to those of the state of New South Wales.
    • Melbourne median household incomes declined 3.5% relative to those of the state of Victoria.
    • Brisbane median household incomes declined 4.4% relative to those of the state of Queensland.
    • Median household incomes in Perth rose marginally more than those in the state of Western Australia (0.2%), while Adelaide incomes rose the strongest against state (South Australia) incomes at 4.4%.

    New Zealand

    Mimicking the largest metropolitan areas in Australia, Auckland, New Zealand’s largest metropolitan area, experienced a median personal income loss of 4.4% relative to that of the nation between 2001 and 2006 (Figure 1).

    Canada

    A similar story has unfolded in Canada. Major metropolitan area median household incomes declined relative to provincial incomes in one half of the cases (Figure 2). The largest relative losses occurred in arguably two most dynamic metropolitan areas :

    • Toronto, which accounts for nearly one fifth of Canada’s population experienced a median household income decrease of 4.4% relative to that of the province of Ontario. Steve LeFluer’s recent article shows that within the Greater Toronto area, the core city, with its amalgamated inner suburbs, has the lowest median household income.
    • Calgary, Canada’s energy capital, also experienced a median household income decrease of 4.4% relative to its province, Alberta.

    Vancouver’s median household income also fell, 3.3% relative to that of British Columbia’s.

    Three metropolitan areas experienced faster economic growth:

    • By far the strongest growth income growth occurred in Montréal, where median household incomes increased 8.4% relative to incomes in Québec.
    • The nation’s capital, Ottawa (a metropolitan area that straddles the borders of Ontario and Québec) experienced a median household income increase of 2.6% relative to the weighted median of the two provinces.
    • Edmonton, Alberta’s capital, experienced income growth marginally above that of the province (0.2%).

    United States

    A review of data in the United States indicates similar results. The same time span (2001 to 2006) was analyzed for the 34 metropolitan areas with more than 1 million population that are in a single state. State personal incomes per capita rose at a greater rate than the metropolitan area rates in 18 of the 34 cases (Figure 3).

    Two California metropolitan areas performed the best. In Los Angeles personal income per capita rose 3.6% relative to that of California in San Diego, per capita income rose at 6% relative to that of the state.

    Other metropolitan areas, including Las Vegas, Salt Lake City, Seattle, Oklahoma City, Cleveland, Pittsburgh and Jacksonville experienced income per capita increases of between 1% and 2% relative to those of their respective states.

    The largest loss occurred in information technology intensive San Jose, where incomes dropped 7.4% relative to those of California. Austin, capital of the nation’s second-largest state, experienced the second largest drop at 5.7% relative to incomes in the state of Texas, which as one of the leading information technology centers in the nation, generally mirrors the San Jose performance.

    Other losses between 2% and 5% relative to their states occurred in Rochester, Dallas-Fort Worth, Atlanta, Tampa-St. Petersburg, Riverside-San Bernardino, Orlando and Buffalo.

    Among the 15 multi-state metropolitan areas, eight experienced income increases relative to the states in the largest share of the population lives (this state with the historical core municipality) and seven declined. Perhaps the most surprising finding is that two metropolitan areas (New York and Washington), which have been among the most consistent in providing economic opportunities experienced only modestly greater income growth than their states.

    • New York, one of the two or three principal financial centers of the world, experienced income growth only 0.6% relative the weighted average of the states of New York and New Jersey, where nearly all of the area is located (Pike County, Pennsylvania is also in the metropolitan area).
    • Washington, where federal government and related in one can be counted upon to produce income growth, experienced only a modest rise of 0.3% relative to the weighted average of the two states (Virginia and Maryland) that comprise nearly all of the metropolitan area (Jefferson County, West Virginia is also in the metropolitan area).

    Metropolitanizing the World?

    These trends suggest a shift in metropolitan fortunes, at least in advanced countries. Historically incomes have grown much more strongly in metropolitan areas than in other areas. Now incomes are rising more quickly or at least nearly as quickly outside some major metropolitan areas as they are inside. It can no longer be blithely assumed that large metropolitan areas experience greater economic growth than their less urban hinterlands. The differences may be fading away, shaped not so much by proximity to the core but by other regional factors.

    We currently can only speculate as to the reasons for this development. The expansion of personal mobility and the ability of people to commute from outside major metropolitan areas may be one reason. Perhaps the most important factor is the rise of the information economy, which has freed some people from more intense urban living by permitting working at home part or all of the time. The proliferation of shopping opportunities, through franchised chains, the outward movement of immigrants, and online ordering may have made formerly remote areas more able to fulfill the needs and desires of people who previously would have inclined to live in more urban surroundings.

    These developments are consistent with the net migration of more than 2 million people away from metropolitan areas of more than 1 million population between 2000 and 2009 in the United States. Further, the phenomenon may be spreading beyond the high income world. As recently noted, in China, economic opportunities may be expanding in rural areas.

    ——

    Note

    This analysis compares metropolitan incomes to incomes in larger political jurisdictions (such as the metropolitan area of San Diego and California). An analysis that compared the area within the larger jurisdiction, but outside the metropolitan area, would yield a somewhat a difference (whether higher or lower), because the larger jurisdiction data available includes the metropolitan areas.

    Photo: “Outback” New South Wales: Faster Income Growth than Sydney (by author)

    Wendell Cox is a Visiting Professor, Conservatoire National des Arts et Metiers, Paris and the author of “War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life”

  • Is China About to Decentralize?

    More than a car, plane or train tick, the “Hukou” (the residential permit system) is the key to mobility in China.

    I can still remember what my junior high English teacher said to my classmates and I, “I really worry about you guys; if you don’t study hard, not only will you not be able to get a job, you will probably have nowhere to stay, while the kids from the countryside; at least they will have some land to grow plants on and a house to live in!” (In my junior high school, all of my classmates had an urban hukou.) Looking back, I can’t help but admire my teacher’s far-reaching vision.

    I remember about two decades ago, my relatives from the countryside spent a fortune to get their kids an urban hukou. At that time, the “value” of one’s hukou was measured by the rank and scale of that city/town. As one can imagine, hukou for major cities such as Beijing, Shanghai, or Guangzhou are more “expensive” than my hometown Yangzhou.

    However, in the past couple years the trend has reversed, especially in the suburban areas of some cities. With the massive real estate development here in China, many lucky “farmers” with rural hukou have received enormous relocation compensation packages, which translate into millions of yuan and several brand new apartments.

    Yet despite these changes, the hukou system creates enormous boundaries for us.

    For someone like me, having a Yangzhou hukou and living in Nanjing, I have to go back to my hometown when I apply for a visa or any documentation related to my hukou. My future offspring will have to pay special fees and higher tuition to be admitted by the local schools. Even when I go to pay my internet bill, I have to pay a year in advance instead of monthly payments just because I do not have a local hukou. Still, I am fairly lucky because Yangzhou and Nanjing are in the same province. People holding a hukou belonging to another province have to overcome even greater difficulties and inconveniences, to say at the least.

    However, do not take it for granted that citizens who have a hukou for the big cities have it made. In Shanghai for example, the local government requires private car owners to pay 40,000 yuan for their license in order to limit the number of automobiles on the roads. Recently, one of my friends who has a Shanghai hukou bought a car in Nanjing, and he could not get a license for his car because the Nanjing authorities worried that he would secure a Nanjing license and actually drive his car in Shanghai in order to avoid paying the 40,000 yuan that the Shanghai municipality requires. He did eventually get his license by proving he is currently working and living in Nanjing and, of course, by pulling some important strings. This is rather ironic when looking back at how people valued a hukou several decades ago.

    The shifts in the value of a hokou parallels another interesting shift: many migrant workers are returning to their hometowns much earlier. In the previous years, migrant workers would usually return home right before Lunar Chinese New Year, which typically falls in February, but a large number of them have started to return home in December this year.

    The driving factor behind this change is that the cost of living in the cities has risen so dramatically over the past few years, and the money migrant workers earn barely covers their living costs. So rather than struggle through the holiday season, more and more are deciding to go home early and enjoy the time with their families. If these workers can secure work in the countryside, then the big cities could suddenly be facing a significant shortage of cheap labor as the Chinese New Year approaches.

    Although China’s urbanization will likely continue, the patterns might increasingly be to smaller cities and towns. In this sense, China’s development may, sooner than any expected, begin to take on the dispersion pattern that has occurred in the Western countries for more than a half century.

    Lisa Gu is a 26-year old Chinese national. She grew up in Yangzhou (Jiangsu) and lives and works in Nanjing (Jiangsu).

    Photo: South Gate, Nanjing

  • The Poverty Of Ambition: Why The West Is Losing To China And India – The New World Order

    The last 10 years have been the worst for Western civilization since the 1930s. At the onset of the new millennium North America, Europe and Oceania stood at the cutting edge of the future, with new technologies and a lion’s share of the world’s GDP.  At its end, most of these economies limped, while economic power – and all the influence it can buy politically – had shifted to China, India and other developing countries.

    This past decade China’s economic growth rate, at 10% per annum, grew to five times that U.S.; the gap was even more disparate between China and the slower-growing  E.U.,  Yet periods of slow economic growth occur throughout history — recall the 1970s — and economies recover. The bigger problem facing Western countries, then, is a metaphysical one — a malady that the British writer Austin Williams has dubbed “the poverty of ambition.”

    This lack of ambition plagues virtually every Western country. The ability to act has become shackled by a profound pessimism that according to a recent Gallup survey contrasts with the optimism found not only in rising states like China, India and Brazil, but also deeply impoverished places like Bangladesh.

    Attitudes have consequences. The rising stars of the non-Western world — from the United Arab Emirates to Singapore and China — are building cities with startling new architecture and bold infrastructure. Their entrepreneurs are expanding their operations across the planet.

    Of course, you can chortle at the outrageous overbuilding in places like Dubai, but the Western world might do better to appreciate the scope of their ambition. Indeed, for years New York’s Empire State building, erected  during the Depression, was derided as  ”the empty state building.” Today it’s visionary developers like Iraqi-born Istabraq Janabi who are planning unlikely  new structures even  in  troubled places like Ramadi, Iraq.

    The difference in ambition can be seen clearly at airports, which now serve as the entry halls of the global economy. A traveler to John F. Kennedy Airport, Heathrow, Charles De Gualle LAX or Dulles passes through decayed remnants of fading late 20th century buildings and technology. In contrast, airports in Dubai, Hong Kong and Singapore offer clean, ultra-modern facilities with often impressive design.

    The West’s retreat from space exploration further underscores its metaphysical poverty. Today, Europe and the U.S., the world’s historic leader in the field, are cutting back on plans to explore the cosmos, which has included a manned operation to the moon. President Obama wants NASA to focus more on issues regarding climate change instead. In contrast, the rising countries of Asia, notably China and India, have begun plans for manned flights to the moon and beyond.

    This divergence is not about resources; it is about the growing conviction in the West that moving forward is an illusion or, as the British academic John Gray’s puts it, “progress is a myth.”  Victorian empire-makers and intellectuals, like their republican American successors, believed perhaps naively in the potential of humanity, economic and technological progress. Today our intellectual and political classes have gone to the other extreme.

    The West’s politics are in the grips of two profoundly retrograde mentalities. One, a small-minded conservatism, harks back to the “golden” age of the 1950s when Western power faced only a flawed Soviet challenge. The idealistic but flawed commitment to imposing democracy by force of the Bush years has faded; it has been replaced by an obsession with taming a bloated public sector. While this focus may be justified, it is fundamentally more reactive than proscriptive.

    The Left, which once portrayed itself as the bastion of scientific rationalism, increasingly embraces neo-druidism, a secular form of nature worship. This tendency’s roots can be traced back to the “Limits to Growth” ideology of the early 1970s which projected, mostly mistakenly, that the planet was about to run out of everything from food to oil. Concerns over climate change have transformed this dismal sentiment into a theology, with carbon emissions treated as a form of original sin.

    The anti-progress nature of the new Left is unmistakable. Rather than seek ways to control climate change, suggests The Guardian’s George Monbiot, environmentalism is engaged in “a battle to redefine humanity.” Monbiot believes the era of economic growth needs to come to an inevitable denouement; that “the age of heroism” will be followed by the decline of the “expanders” and the rise of the “restrainers.”

    Europe, particularly the U.K., suffers acutely from metaphysical angst.  Once touted as the new great power by its leaders and their American claque, the E.U. is quickly dissolving along cultural and historical lines; this is especially evident in the division between the  resilient countries of the north (something like the Hansa trading states of the late Middle Ages) and the weaker countries along the periphery. For the most part, Europe no longer seems capable of doing much more than finding ways to control an unaffordable welfare state without tearing about its social net. The once cherished notion of a multi-racial “new” Europe largely has dissolved as immigration has devolved from a source of demographic and cultural salvation to a widely perceived threat to the E.U.’s economic and social health as well as security.

    Such defeatism usually has less success in the United States. But America’s “progressive” left increasingly resembles its European cousins.  Obama’s science advisor, John Holdren, has been a long-time advocate of the idea of “de-development,” the purposeful slowing of growth in advanced countries in order to protect the environment. The critical infrastructure needed to accommodate upward of another  100 million Americans — new dams in the west, intelligent development of our vast natural gas reserves and building new cities, airports and ports  – are not at the center of either party’s platforms. These could be financed largely with private sources, given the right incentives.

    Fortunately the West’s decline is not at inevitable. China, India, Vietnam, Brazil, South Africa all deserve their day in the sun, but this does not mean that Americans or Europeans should cower in the shadows. Western countries still possess much of the world’s cutting-edge technology and leading companies; the combined GDP for the E.U., North America and Oceania stands at over $33 trillion, almost five times that of India and China together.

    More important still, the political and cultural institutions of the West — with their liberal values — represent the best hope for a stable world of self-governing peoples. Does anyone in the West, particularly the progressives in the media and academia, really want a world run by Chinese despotism?

    The current financial crisis should serve as both a warning and a spur for a new focus on economic expansion. But this can only occur if the West can restore its belief in its future. This does not necessitate a return to the colonial attitudes of the past, but rather a keener appreciation of our unique human, physical and political advantages.

    Only the United States – by far the richest, largest and most populous Western nation — can lead such a revival. For one thing, the U.S. remains the world’s leading immigrant magnet and most diverse large country, all of which makes it the natural center of an evolving global society. Although immigrants pose some serious issues, University of Chicago scholar Tito Sananji notes that the U.S., along with Canada and Australia, seems to be doing a better job educating their newcomers than the continental European states.

    The U.S., Canada and Australia also possess resources, most critically food, that could benefit from growing demand in developing countries. Both North America and some European nations — notably the new Hansa of the Netherlands, Germany and Scandinavia – remain world leaders in scores of industrial endeavors, as well as technology- and culture-based industries.

    Together these Western countries can do much more to shape the global future than is commonly understood. But to do so this century they will need how to recover the animal spirits that drove their remarkable rise in the last.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University, and an adjunct fellow of the Legatum Institute in London. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

    Photo by Wally Gobetz

  • A Bump in the Road to Chinese Urbanization?

    China has been urbanizing at a break-neck pace. Between 1980 and 2010, nearly China’s urban areas have added 450 million people, nearly 1.5 times the population of the United States. Nearly one-half (47%) of the nation’s population now lives in urban areas and the figure is expected to exceed 60% by 2030, according to United Nations data.

    According to The Asia Times, 230 million of these new residents are temporary migrants. They are people who have migrated from rural areas to take jobs in factories or other generally lower paid occupations. Under the nearly 60-year old Chinese residency permit system (“hukou”) citizens have either rural or urban residency rights. A principal purpose of this system was to limit the flow of rural residents to the urban areas.

    As Deng Xiaoping’s reforms took effect in the early 1980s, industrial production and exports skyrocketed and this required rural labor to migrate to the urban areas. Migrants were granted temporary status, but not permanent. It is possible, but difficult to transfer one’s hukou from rural to urban. Yet the demand for such transfers has been overwhelming.

    Yet, an article in the national newspaper, China Daily could mean a slowdown in the trend. The issue is the cost of living. Reporter Wang Yan notes that, for the first time, there is now a growing demand for transferring hukou residential status from urban to rural. There are currently no routine national procedures for such transfers.

    A survey of 120,000 temporary migrant workers in urban areas working by the Chinese Academy of Social Sciences research center found that only 25 percent would be interested in trading their rural residency permits for urban residency permits. The survey covered working age adults in 106 prefectures with large urban areas.

    The driving factor is economic. As in the United States, where differences in housing affordability are strongly associated with domestic migration trends, costly urban housing in China could be fueling a new attraction for rural areas. The cost of housing has risen substantially in China’s urban areas. At the same time, the cost of housing is near-zero in the rural areas. Further, residents of rural areas within prefectures with large urban areas have the hope of selling their land for urban development in the longer run and making a substantial profit. However, this new-found affection for the countryside is likely to be limited to areas relatively close to urban centers, to which rural residents can commute for better paying jobs.

    The government has announced plans to reform the hukou residency permit system. According to Zhang Yi, director of the Chinese Academy of Social Sciences research center is a system that “ensures freedom of migration.”

    The United Nations projections may be right. The stated preferences identified in the Chinese Academy of Social Sciences survey may not ultimately reveal themselves in actual behavior. But predictions are no more than predictions.

    Picture: Shenzhen: Luxury Housing (foreground) and Migrant Housing (background)

  • China’s Urbanization: It Has Only Just Begun

    In May, disgruntled workers of Honda factories in Zhongshan, southern China, went on strike at the Honda Lock auto parts factory and started posting accounts of the walkout online, spreading word among themselves and to workers elsewhere in China.

    In June, Bloomberg reported that China, “once an abundant provider of low-cost workers, is heading for the so-called Lewis turning point, when surplus labor evaporates, pushing up wages, consumption and inflation.” China had depleted its surplus labor; the period of cheap labor was over.

    In the subsequent debate, some observers concurred with the observation that a turning point had arrived in China. Others noted that the conclusion is too simplistic because it does not fit into the big picture of China’s demography.

    With the gloomy economic prospects in the advanced economies and relatively strong recovery in the large emerging economies, the debate is about to resurface.

    Eclipse of “Unlimited Supplies of Labor”

    In 1954 Arthur Lewis published one of the most influential development economics articles, “Economic Development with Unlimited Supplies of Labor,” which contributed to his Nobel Prize a quarter of a century later. In this paper, Lewis sought to provide a broad portrayal of the development process, based on the current state of the developing countries, the historical experience of developed countries, and some central ideas of the classical economists.

    In the Lewis story a “capitalist” sector develops by taking labor from a non-capitalist backward “subsistence” sector. At an early stage of development, there would be “unlimited” supplies of labor from the subsistence economy, which means that the capitalist sector can expand without the need to raise wages. The implication is that industrial wages in developing countries begin to rise quickly at the point when the supply of surplus labor from the countryside tapers off.

    Lewis likely would have recognized the validity of his tipping point in the more prosperous first-tier cities of China where there clearly are increasing labor shortages and which thus reflect the world of classical economics. However, had he taken a tour in China’s smaller cities, or ventured into the countryside, he would have recognized there still remains “unlimited supplies of labor” – the world portrayed by the classical political economists, including David Ricardo, Adam Smith, and Karl Marx.

    So has China reached the Lewisian tipping point? The answer is yes and no: in some regions yes, but in all of China, emphatically n no.

    Urbanization and Growth through Tiered Cities

    Starting in the 1980s, China’s reform and opening up were initiated by the creation of the coastal special economic zones (SEZs), initially in the southern province of Guangdong, close to Hong Kong and Macao. Soon the reform extended from urban agglomerations such as Shenzhen and Guangzhou to other primary cities, from Beijing to Shanghai – thanks to the colossal investment projects in Pudong which turned the swampland into an emerging global financial hub.

    During the past decade, the economic success of these megacities has been spilling over into other tiers of Chinese cities. Even before the onset of the global financial crisis, second-tier cities – such as Suzhou, Tianjin, Shenyang, Chengdu, Dalian and Chongqing – had already attracted significant attention with investments from global corporate giants.

    At the same time, third-tier cities, from Ningbo and Fuzhou to Wuxi and Harbin, have been following in the footprints of first- and second-tier cities. Behind these three tiers of rapidly-growing urban agglomerations, there are still others such as Kunming and Hefei, seeking to take advantage of the urban growth trajectories.

    Some 60 years ago, Lewis saw something similar in several developing countries, with their polar opposites, vibrant and modern cities, and sleepy and traditional rural villages. “There are one or two modern towns, with the finest architecture, water supplies, communications and the like, into which people drift from other towns and villages which might almost belong to another planet.”

    Migration and the Turning Point

    Paced by strong economic growth, China’s leading megapolises are also evolving very fast. The urbanization that took almost a century in the West is occurring in a decade or two in China. In 1979, Shenzhen was still a poor fishing village with some 20,000 inhabitants. In 2009, it had a population of 9 million, and income per capita exceeded $13,600, only $3,000 less than in Taiwan or South Korea. Now Shenzhen plans to achieve an average GDP per capita of $20,000 by 2015, the level of European countries, such as Portugal and Slovenia. In the latter, the real GDP growth will be more subdued in the coming years, at best. In Shenzhen and China’s other megacities, it will be around 10%.

    Yet, despite these colossal shifts, China’s urbanization still has a long way to go. In 1980, the U.S. urban population was 74% of the total; China’s comparable figure was only 19%. Today, America’s urban share of the population is more than 80%, whereas China’s remains less than 50%. Taken into consideration China’s colossal size and development level, this gap suggests extraordinary potential. In 2025, America will have two cities (New York and Los Angeles) with more than 10 million people, three with 5-10 million and 37 with more than a million. By then, China will have five cities with more than 10 million people, 9 with 5-10 million, and almost 130 with more than a million. Viewed this way, China’s urbanization has barely begun (Figure 1).

    Figure 1: Percentage of Urban Population: United States and China

    Winning China’s West
    If Lewis had spent even some time in the rural China or the emerging new tiers of cities, he would have associated them with the world of “unlimited supply of labor”.

    During the past three decades, migrant laborers have played a key role in China’s economic growth in the first-tier cities. Now as living costs rise fast in Beijing, Guangdong, and the Yangtze River Delta region, employment prospects are improving in the inland cities and the West.

    Since the early 2000s, the new “Go West” policy covered the huge municipality of Chongqing, six provinces, from Gansu to Sichuan and Yunnan, and five autonomous regions. At the time, this region accounted for almost 30 percent of China’s population, but less than 17 percent of its GDP. Initially, the policy focused on the development of infrastructure (transport, hydropower plants, and energy and telecom establishments). But it is the new stage of development in eastern China that is now dramatically accelerating growth in the West.

    Even before the global financial crisis, the Ministry of Commerce designated more than 30 “priority relocation destinations” in China’s inland to increase the share in the processing industry in central and western areas, especially in labor-intensive manufacturing.

    In the future, China’s West hopes to catch up with its East through domestic consumption, cost advantage, investment policies and infrastructure, which has been boosted by the nation’s stimulus policies. China’s West is about to experience a revolution in durable consumer goods, from color TV sets to refrigerators. True, the volume of retail sales remains higher in China’s East, but sales growth is stronger in the non-coastal areas.

    As costs have risen, China has lost some jobs to Bangladesh, Vietnam and Cambodia, primarily for cheaper, labor-intensive goods like textiles, simple electronics, and toys. Yet, China’s West still offers many of the comparable benefits and an emerging infrastructure.

    The Decades to Come

    In the next two decades, China’s urbanization is expected to boost domestic demand by $4.5 trillion, which should assure a stable economic development even if exports decline. In effect, the urban migrants’ demand for housing is likely to become the largest driving force for China’s economic growth in the future.

    During the past three decades, the share of China’s city dwellers has more than doubled to 45 percent. And by 2040, the urbanization rate is expected to be close to 67 percent. In the next three decades, the number of China’s urban residents is expected to grow by 360 million people to 970 million. In terms of current urban populations, this is the same as creating city space for entire urban America (260 million), Japan (85 million) and another 15 million people – within one generation.

    This great transformation, however, is predicated on sustained economic growth and a stable international environment. China’s first-tier cities are now coping with the coming of the Lewisian turning point/ The big story in the coming decades, will be the takeoff in the west and among many once peripheral cities. Due to China’s sui generis magnitude, this process will take another decade or two.

    Dan Steinbock is Research Director of International Business at India China and America Institute (USA), and Visiting Fellow at Shanghai Institutes for International Studies (China).

    China’s Provinces and Cities

    References

    1 Hamlin, K. et al. (2010), “China Reaches Turning Point as Inflation Overtakes Labor,” Bloomberg News, June 11.

    2 On the argument that China is coping with the Lewisian turning point, see Cai, Fang, Wang, Meiyan, 2008. A counterfactual analysis on unlimited surplus labor in rural China. China & World Economy 6 (1), 51–65.; Fang Cai, Meiyan Wang (2010), “Growth and structural changes in employment in transition China,” Journal of Comparative Economics 38 (2010) 71–81. On the argument that Lewisian turning point is years away, see Yang Yao (2010), “No, the Lewisian turning point has not yet arrived,” Economist, July 16, 2010; Roach, S. (2010), “ Chinese wage convergence has a long way to go,” Economist, July 18.

    3 Lewis, W. Arthur (1954). “Economic Development with Unlimited Supplies of Labor,” Manchester School of Economic and Social Studies, Vol. 22, pp. 139-91

    4 Steinbock, D. (2010),” Legacy of Globalization: Shanghai and Hong Kong as China’s Emerging Financial Hubs,” Policy Brief, Shanghai Institutes for International Studies, January 2010.

    5 These tiers of cities are evolving dynamically and through a national plan. With its more than 31 million people, Chongqing, for instance, is already one of China’s five national central cities. National central cities have a great impact around the surrounding cities on integrating services in infrastructure, finance, public education, social welfare, sanitation, business licensing and urban planning.

    6 In fact, Lewis’s classic article offers also another clue to assess China’s stages of growth. As far as he is concerned, small migrations explain little. In the 1950s, he noted, 100,000 Puerto Ricans emigrate to the United States every year. Still, it is Puerto Rican wages which are pulled up to the U.S. level. Mass immigration is quite a different kettle of fish. “If there were free immigration from India and China to the U.S.A., the wage level of the U.S.A. would certainly be pulled down towards the Indian and Chinese levels,” Lewis argued. In China’s economic development, the tens of millions of migrant workers have played the comparable role of pulling down the national wage level.

    7 In the beginning of the “Go West” program, the largest proportion of the West’s total fixed asset investment was in infrastructure. And almost half of China’s huge stimulus of $586 billion was earmarked for transportation, infrastructure and power grids. These, in turn, facilitate the exploitation of minerals, natural gas and oil in China’s West. In addition to the stimulation of domestic demand, the government’s strategy is to “cultivate areas of high consumer demand and expand consumption in new areas”.

    8 “China’s urbanization to fuel domestic demand,” China Daily, November 15, 2010.

    9 Steinbock, D. (2010), “Growth fueled by urban investment,” China Daily, February 25, 2010.

    10 On the international relations dimensions of China’s stages of growth, see Steinbock, D. (2010), “China’s Next Stage of Growth: Reassessing U.S. Policy toward China,” American Foreign Policy Interests, No 6, December 2010.

  • Satellite Cities for Beijing? Yes, But….

    China Daily ran an article on the continuing urbanization of Beijing. In Build upward or outward: City’s growth dilemma, Daniel Garst notes that Beijing is not as centralized as other urban areas, with its multiple business districts and comparatively low density in its inner areas. He indicates a preference for the urbanization of Shanghai, with its stronger center (both Pudong and Puxi), but suggests that it would be a mistake to replace the historic low density development with the high rises that would be necessary to change Beijing’s urban form.

    Actually, Beijing’s form is not that unusual for Asian urban areas. Tokyo has multiple office centers rather than a single dominant center and has comparatively low residential densities, even within the Yamanote Loop. Bangkok, Manila and Jakarta are similarly multi-centric. Chinese urban areas like Shenyang, Xi’an, Wuhan, Suzhou and Changsha are closer (but smaller) replicas of Beijing than Shanghai. Garst also misunderstands the dynamics of traffic congestion in his belief that roads and metros (subways) would be less congested with a more centralized form. In fact, higher densities routinely produce more intense congestion, not only on the roads but also on the rails and buses, a point recently made by Michael Matusik on this site.

    However, Garst may be onto something with respect to a suggestion that Beijing’s growth should be directed to new satellite towns, in which residents work rather than commuting to Beijing. This is good theory, but there is an important caveat, which we outlined in a comment at China Daily on the article.

    Satellite cities are not a reasonable answer unless they are so far from the Beijing urban area that commuting to Beijing is not possible. The idea of self-contained satellite cities, where people live and work in them has not worked anywhere. There are good examples of failure in London, Cairo, Stockholm, etc. So long as the large urban area can be reached, people will commute there.

    Cairo provides a useful example. Egyptian planners have long decried the continuing commute pattern into the urban area from the new towns of 6th of October and 10th of Ramadan, which are within commuting distance. On the other hand, the new town of Anwar Sadat, more remote from the urban area, has been more successful in keeping its residents in its labor market.

    Locating new satellite towns far enough to make commuting infeasible will be a real problem for Beijing. There just is not enough territory in the provincial level municipality. That means the new towns would have to be in the province Hebei, which along with the province level municipality of Tianjin surrounds Beijing.

    Short of remote new towns and forcing population and economic growth away from Beijing, the key to minimizing traffic congestion will be to minimize work trip distances by achieving a dispersion of comparatively lower density employment to match the lower density suburban dispersion. Economists Peter Gordon and Harry W. Richardson have found that “suburbanization has been the dominant and successful mechanism for reducing congestion.” in the United States. This applies no less to Beijing.

    Photograph: Forbidden City, Beijing (by author)

  • The World’s Fastest-Growing Cities

    The evolution of cities is a protean process–and never more so than now. With over 50% of people living in metropolitan areas there have never been so many rapidly rising urban areas–or so many declining ones.

    Our list of the cities of the future does not focus on established global centers like New York, London, Paris, Hong Kong or Tokyo , which have dominated urban rankings for a generation. We have also passed over cities that have achieved prominence in the past 20 years such as Seoul, Shanghai, Singapore, Beijing, Delhi, Sydney, Toronto, Houston and Dallas-Fort Worth.

    Nor does our list include the massive, largely dysfunctional megacities–Mumbai, Mexico City, Dhaka, Bangladesh–that are among planet’s most populous today. Bigger often does not mean better.

    Instead, our list focuses on emerging powerhouses like Chongqing, China, (population: 9 million), which Christina Larson in Foreign Policy recently described as “the biggest city you never heard of.”

    Chongqing sits in the world’s most important new region for important cities: interior China. These interior Chinese cities, notes architect Adam Mayer, offer a healthy alternative to coastal megacities such as Shanghai, Hong Kong, Shenzen and Guangzhou, which suffer from congestion, high prices and increasingly wide class disparities. China’s bold urban diversification strategy hinges both on forging new transportation links and nurturing businesses in these interior cities. For example, in Chengdu, capital of the Sichuan province, new plane, road and rail connections are tying the city to both coastal China and the rest of the world. And the city is abuzz with new construction, including an increasing concentration of high-tech firms such as Dell and Cisco.

    India, although not by plan, also is experiencing a boom in once relatively obscure cities. Its rising urban centers include Bangalore (home of Infosys and Wipro), Ahmedabad (whose per-capita incomes are twice that of the rest of India) and Chennai (which has created 100,000 jobs this year). Many of India’s key industries–auto manufacturing, software and entertainment–are establishing themselves in these cities.

    The growth of India and China also creates opportunity for other emerging players, particularly in Southeast Asia by creating markets for goods and services as well as investment capital. Potential hot spots include places like Hanoi, Vietnam, which is attracting greater interest from Japanese, American and European multi-national firms upset with China’s often bullying trade practices and rising costs. Malaysia’s capital Kuala Lumpur–with its rising financial sector–also displays considerable promise.

    Africa also boasts many huge, rapidly growing cities, but it’s hard to identify many of these places–like Lagos, Nigeria, Luanda, Angola or Kinshasa, the Democratic Republic of the Congo–as bright prospects. One exception may well be Cape Town, the beautiful South African coastal city that shone so well during the recent World Cup.

    Latin America, too, has a plethora of huge and growing cities, but it’s hard to nominate the likes of Mexico City or Sao Paulo as likely hot spots for future sustainable growth.

    The best economic prospects in this region lie in more modestly sized cities like Santiago, the capital of resource-rich Chile, and even Campinas, Brazil, a growing smaller city–with 3 million residents–that lies outside the congested Sao Paolo region. This shift to smaller-scaled cities, as Michigan State’s Zachary Neal points out, has been conditioned by massive improvements in telecommunications and transportation infrastructure throughout the urban world. Today, he asserts, it is the ability to network long-distance–not girth–that makes the critical difference.

    This is clear in the Middle East, where the emerging stars tend to be smaller cities. Tel Aviv, whose total metropolitan area is no larger than 3 million, has emerged as a major center for technology as well as one of the world’s premier diamond centers. The other leading candidates in the region hail from the United Arab Emirates, notably oil-rich Abu Dhabi and perhaps its now weakened neighbor, Dubai.

    In North America the best urban prospects–Raleigh-Durham, N.C.; Austin, Texas; Salt Lake City; and Calgary, Canada–are far smaller than homegrown giants New York, Chicago and Los Angeles. Generally business-friendly and relatively affordable, these cities will attract many talented millennials as they start forming families in large numbers later in this decade.

    Europe’s urban problem lies with stagnant or slow-growing population levels, and in the south at least, very weak economies. The only rapidly growing big city lies on the region’s periphery: Istanbul, which straddles the border between Europe and Asia and faces many of the problems common to developing-country mega-cities.

    Overall, the populations of Europe’s cities are growing at barely 1%, the lowest rate of any continent. With low birthrates and growing opposition to immigration, it seems unlikely that any European city will emerge as a bigger global player in 20 years than today.

    Other leading cities all over the world may also be in the early stages of fading from predominance. In the United States, according to analysis by the California Lutheran University forecast, Los Angeles and Chicago, America’s second and third cities, respectively, have fallen behind not only fast-comers like Houston and Dallas-Fort Worth, but even historically dominant New York in such key indicators as job generation and population growth.

    Similarly Berlin, once seemingly poised to thrive in the post-Cold War future, has chronic high unemployment and a weak private sector, compared with Germany’s generally smaller, less unruly successful cities. The Osaka-Kobe-Kyoto area in Japan may also be set to fade a bit, due largely to the overwhelming predominance of Tokyo and the general demographic and economic decline of Dai Nippon.

    Of course, none of this is set in stone. But this list provides an educated peek into which cities are best positioned to prosper and grow in our emerging era of cities.

    Chengdu, China

    The development of interior China, long on the back burner of national priorities, has reached the country’s western-most large city. Chengdu is abuzz with new construction, including an increasing concentration of high-tech companies, including Dell and Cisco. New plane, road and rail connections are tying the city to both coastal China and the rest of the world. With a metropolitan population of 6 million, economic factors–including lower costs–may prove critical to the capital of the Sichuan province. The business-friendly city still has a way to grow to catch up to the GDP per capita of Shanghai.

    Chongqing, China

    Chongqing enjoys rapidly improving transportation links with its neighbors to the west and the coastal megacities. Foreign companies like Ford, Microsoft, Hewlett Packard and Singapore-based Neptune Orient Lines are flocking to the city. The Business Times of Singapore reports that since 1998, Chongqing’s GDP has quadrupled from $21 billion to $86 billion. Last year alone, Chongqing’s GDP expanded at almost twice the rate of China as a whole. The population, according to United Nations projections, should grow from 9 million to 11 million by 2025.

    Chongqing, China

    Chongqing enjoys rapidly improving transportation links with its neighbors to the west and the coastal megacities. Foreign companies like Ford, Microsoft, Hewlett Packard and Singapore-based Neptune Orient Lines are flocking to the city. The Business Times of Singapore reports that since 1998, Chongqing’s GDP has quadrupled from $21 billion to $86 billion. Last year alone, Chongqing’s GDP expanded at almost twice the rate of China as a whole. The population, according to United Nations projections, should grow from 9 million to 11 million by 2025.

    Ahmedabad, India

    This is the largest metropolitan region in Gujarat, perhaps the most market-oriented and business-friendly of Indian states. Gujarat’s policies helped lure away the new Tata Nano plant from West Bengal (Kolkata) to Sanand, one of Gurajat’s exurbs. One Indian academic, Sedha Menon, compares the state–which has developed infrastructure more quickly than its domestic rivals–with Singapore and parts of Malaysia. Per-capita incomes in Gujarat are more than twice the national average. India’s seventh-largest city has a population of roughly 5.7 million and is expected, according to the U.N., to grow to over 7.6 million by 2025.

    Santiago, Chile

    Santiago boasts a diversified economic base: mining, textile production, leather technologies and food processing. Its favorable investment climate has enticed many multinational companies; there are few restrictions on foreign investment, and transparency is extensive. Recent surveys have ranked Chile and Santiago as leading locations in Latin America in terms of competitiveness. The 2010-2011 Global Competitiveness Report ranked Chile the highest in terms of competitiveness (based on institutions, infrastructure, macroeconomic environment, education, market efficiency, financial market development, et. al).

    Raleigh Durham, North Carolina

    Even in hard times this low-density, wide-ranging urban area has repeatedly performed well on Forbes’ list of the best cities for jobs. The area is a magnet for technology firms fleeing the more expensive, congested and highly regulated northeast corridor. One big problem obstructing the region’s ascendancy has been air connections. But Delta recently announced a large-scale expansion of flights there from around the country. Population growth will likely be lead by educated millennials seeking affordable housing and employment opportunities. Today the region has 1.7 million residents; the State of North Carolina projects it will grow to 2.4 million by 2025.

    Tel Aviv, Israel

    This urban region of roughly 3 million may boast the most vibrant economy of any along the Mediterranean. Tel Aviv and its surrounding environs control the vast majority of Israel’s high-tech exports, making it what may well be the closest thing to a Silicon Valley outside East Asia or California. It also boasts a household income that is nearly 50% above the national average for Israel. But perhaps its greatest asset is its free-wheeling lifestyle: Tel Aviv combines an Israeli entrepreneurial culture with the attributes of a thriving seacoast town.

    Kuala Lumpur, Malaysia

    Kuala Lumpur’s prospects lie in a development strategy focused on improving its air service, road and trade infrastructure, much as occurred in previous decades in Singapore. The urban area’s population has grown to over 5.8 million, and demographer Wendell Cox projects a population of roughly 8.2 million by 2025. KL has emerged as a global Islamic financing hub and maintains close ties with the Arabian Gulf’s finance sector. Educational and health care institutions also bolster the city’s growth. Forbes lists Kuala Lumpur as one of Asia’s future financial centers.

    Suzhou, China

    As in the U.S., some of the fastest-growing cities in China are located close to the bigger cities. Suzhou, only 75 miles from Shanghai, seems well positioned to benefit from spillover growth from the megacity. Known as the Venice of China, with many attractive canals and vast international tourism potential, its beauty and history could help secure its aspiration to become “the world’s office.” Some reports suggests Suzhou may already be the most affluent city in China; demographer Wendell Cox estimates that per-capita income is more than three times that of interior cities like Chengdu.

    Hanoi, Vietnam

    Chinese, Japanese, American, Singaporean, European and Indian companies identify this fast-growing city as ripe for industrial and infrastructure growth. The population of the region has doubled since the end of the Vietnam War to almost 3 million, and the U.N. projects a population of 4.5 million by 2025. Along with Ho Chi Minh City (formerly Saigon), Hanoi is expected be one of the fastest-growing GDPs in the world. Hanoi’s GDP growth rate for the first nine months of 2010 was estimated at 10.6%, almost twice that for the same period of last year.

    Chennai, India

    Formerly known as Madras, this metropolitan area of 7.5 million, up from 4.7 million 20 years ago, is projected by the U.N. to approach 10 million by 2025. Located on India’s east Asian coast, the city has so far this year created over 100,000 jobs–more than any other Indian city outside of the much larger Delhi and Mumbai. Chennai’s metropolitan area is taking full advantage of India’s soaring industrial sector, particularly the booming automobile sector. Electronics, led by Dell, Nokia, Motorola, Samsung, Siemens, Sony and Foxconn, are also booming. Chennai is home to India’s second-largest entertainment industry, behind Mumbai.

    Austin, Texas

    Austonites tend to be smug–but they have good reason. The central Texas city ranked as the No. 1 large urban area for jobs in our last Forbes survey. Along with Raleigh-Durham, Austin is an emerging challenger for high-tech supremacy with Silicon Valley. The current area’s population is 1.7 million and is expected to grow rapidly in the coming decades. Austin owes much both to its public sector institutions (the state government and the main Campus of the University of Texas) and its expanding ranks of private companies–including foreign ones–swarming into the city’s surrounding suburban belt.

    Abu Dhabi, United Arab Emirates

    Oil rich Abu Dhabi is among the world’s wealthiest countries in terms of per-capita GDP, which exceeds $68,000. However, the non-oil sector is likely to grow to about 45% of the GDP in coming years. To do so, the government has started to invest its oil revenues in construction, tourism and the electricity and water industry. Abu Dhabi is also helping to keep its neighbor Dubai afloat. If Dubai, with its world class infrastructure, can make a comeback, a global city separated by 80 miles of desert Arabian Gulf coastline could arise.

    Campinas, Brazil

    Campinas, located around 50 miles north of São Paulo, the country’s dominant industrial center, has attracted many technology companies, including IBM, Dell, Compaq, Samsung and Texas. The city also boasts a major research and university center. Firms engaged in high-tech activities–following a global pattern–tend to cluster in relatively pleasant, affordable and efficient places. Campinas could prove a big Brazilian beneficiary of this trend.

    Melbourne, Australia

    Australia has resources galore and relatively few people. But which of its cities is poised to benefit most from the nation’s expanding trade with China and India? Sydney’s costs have been shooting up–particularly for housing, but Melbourne’s political class seems about to open up new land for suburban development to restore some of the area’s affordability for younger Australians. Demographer Bernard Salt has predicted that Melbourne’s population will exceed Sydney‘s in less than 20 years. Melbourne also boasts Australia’s most walkable and pleasant urban cores , a pleasant San Francisco-like climate and a European ambiance.

    Bangalore, India

    Many big players in tech and services–Goldman Sachs, Cisco, HP as well as India-based giants like Tata–have located operations in Bangalore. But the city also boasts home-grown tech giants Infosys and Wipro, which each have over 60,000 employees worldwide. Since 1985 Bangalore’s population has more than doubled to over 7 million and is projected by the U.N. to reach 9.5 million by 2025. In the future, maintaining Bangalore’s advantage over smaller, less congested cities could prove a challenge.

    Salt Lake City, Utah

    Once seen as a Mormon enclave, the greater Salt Lake urban area–with roughly 1 million people –has every sign of emerging as a major world player with a wider appeal. The church still plays a critical role, in part by financing a massive redevelopment of the city’s now rather dowdy city core. The area’s population has doubled since the early 1970s and will grow another 100,000 by 2025 to well over 1.1 million. New companies are flocking to this business-friendly region, particularly from self-imploding California. Increasing national and global connections through Delta’s hub will tie this once isolated city closer with the wider world economy.

    Nanjing, China

    The one-time Imperial and Republican (Nationalist) capital sits only 150 miles from Shanghai. The relative affordability of Nanjing has drawn huge construction projects to the city, which is also the capital of Jiangsi Province. The city is developing a transport hub, and huge commercial construction projects abound in the downtown area. A majority of employment is in the fast-growing service sector. The metropolitan economy grew 50% just between 2006 and 2008, and future rapid growth is likely.

    Cape Town, South Africa

    The second-largest city in South Africa behind Johannesburg, Cape Town made the most of the recent World Cup. The region of some 3 million boasts fast-growing communications, finance and insurance sectors. Cape Town is looking to intellectual capital, transportation assets, business costs, technology, innovation and ease of doing business as its primary assets. In 2009 Empowerdex rated Cape Town as the top-performing municipality in South Africa for service delivery. About 97% of the operational budget went to infrastructure development, ensuring that households can enjoy adequate sanitation and water access.

    Calgary, Canada

    You don’t have to buy the notion of a climate-change-driven northern ascendancy to see a bright future for Alberta’s premier city. Calgary is positioned well on the fringe of Canada’s largest energy belt and enjoys lower taxes and less stringent regulations than its Canadian rivals. Calgary has been hit by a slowdown in energy business, but over time demand from China, India and a slowly recovering world economy should boost this critical sector. The region is expected to be back to its familiar place on top among Canadian urban economies by next year.

    The World’s Diminishing Cities: Chicago, Ill.

    Great cities don’t only rise, some decline. Even with Barack Obama in the White House, Chicago is struggling with persistent job losses that, since 2000, are exceeded only by Detroit among the nation’s top 10 largest U.S. regions. The Windy City’s deficit as a percentage of spending–a remarkable 16.3 %–is now higher than Los Angeles and twice that of New York. Moreover, crime remains stubbornly high, and the widely hyped condo boom has left a legacy of uncompleted buildings, foreclosures and vacancies.

    The World’s Diminishing Cities: Berlin, Germany

    By all rights, Berlin should be a European boomtown: The capital of united Germany, a natural crossroads to the east and Europe’s bohemian hot spot. But it remains, as its mayor, Klaus Wowereit, famously remarked, “poor but sexy.” Berlin suffers unemployment far higher than the national average, and its gross added-value per inhabitant amounted to just over half that created by residents in the northern city of Hamburg, which has about half as many people. One-quarter of the workforce earns less than 900 euros a month, and one out of every three children lives in poverty.

    The World’s Diminishing Cities: Osaka-Kobe-Kyoto, Japan

    Few places possess a more glorious urban pedigree than Japan’s Kansai region. But the shift of manufacturing to China and other countries has undermined the economy of Osaka, traditionally the industrial heart of Japan. As Japan shrinks both economically and demographically, Tokyo, the world’s largest city, looms ever larger while Osaka’s role is, as one demographer put it, “fading away.” Tokyo’s population, now over 30 million, has grown to be double that of the Osaka region, and continues to outpace it. Most critical: It is to Tokyo, not Osaka, that Japan’s diminishing reserves of educated young people–and industries dependent on their talent–are headed.

    This article originally appeared at Forbes.com.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

    Photo by Sarmu

  • The New World Order

    Tribal ties—race, ethnicity, and religion—are becoming more important than borders.

    For centuries we have used maps to delineate borders that have been defined by politics. But it may be time to chuck many of our notions about how humanity organizes itself. Across the world a resurgence of tribal ties is creating more complex global alliances. Where once diplomacy defined borders, now history, race, ethnicity, religion, and culture are dividing humanity into dynamic new groupings.

    Broad concepts—green, socialist, or market-capitalist ideology—may animate cosmopolitan elites, but they generally do not motivate most people. Instead, the “tribe” is valued far more than any universal ideology. As the great Arab historian Ibn Khaldun observed: “Only Tribes held together by a group feeling can survive in a desert.”

    Although tribal connections are as old as history, political upheaval and globalization are magnifying their impact. The world’s new contours began to emerge with the end of the Cold War. Maps designating separate blocs aligned to the United States or the Soviet Union were suddenly irrelevant. More recently, the notion of a united Third World has been supplanted by the rise of China and India. And newer concepts like the BRIC nations (Brazil, Russia, India, and China) are undermined by the fact that these countries have vastly different histories and cultures.

    The borders of this new world will remain protean, subject to change over time. Some places do not fit easily into wide categories—take that peculiar place called France—so we’ve defined them as Stand-Alones. And there are the successors to the great city-states of the Renaissance—places like London and Singapore. What unites them all are ties defined by affinity, not geography.

    1. New Hansa

    Denmark, Finland, Germany, Netherlands, Norway, Sweden

    In the 13th century, an alliance of Northern European towns called the Hanseatic League created what historian Fernand Braudel called a “common civilization created by trading.” Today’s expanded list of Hansa states share Germanic cultural roots, and they have found their niche by selling high-value goods to developed nations, as well as to burgeoning markets in Russia, China, and India. Widely admired for their generous welfare systems, most of these countries have liberalized their economies in recent years. They account for six of the top eight countries on the Legatum Prosperity Index and boast some of the world’s highest savings rates (25 percent or more), as well as impressive levels of employment, education, and technological innovation.

    2. The Border Areas

    Belgium, Czech Republic, Estonia, Hungary, Iceland, Ireland, Latvia, Lithuania, Poland, Romania, Slovakia, U.K.

    These countries are seeking to find their place in the new tribal world. Many of them, including Romania and Belgium, are a cultural mishmash. They can be volatile; Ireland has gone from being a “Celtic tiger” to a financial basket case. In the past, these states were often overrun by the armies of powerful neighbors; in the future, they may be fighting for their autonomy against competing zones of influence.

    3. Olive Republics

    Bulgaria, Croatia, Greece, Italy, Kosovo, Macedonia, Montenegro, Portugal, Slovenia, Spain

    With roots in Greek and Roman antiquity, these lands of olives and wine lag behind their Nordic counterparts in virtually every category: poverty rates are almost twice as high, labor participation is 10 to 20 percent lower. Almost all the Olive Republics—led by Greece, Spain, and Portugal—have huge government debt compared with most Hansa countries. They also have among the lowest birthrates: Italy is vying with Japan to be the country with the world’s oldest population.

    4. City-States

    London

    It’s a center for finance and media, but London may be best understood as a world-class city in a second-rate country.

    Paris

    Accounts for nearly 25 percent of France’s GDP and is home to many of its global companies. It’s not as important as London, but there will always be a market for this most beautiful of cities.

    Singapore

    In a world increasingly shaped by Asia, its location between the Pacific and Indian oceans may be the best on the planet. With one of the world’s great ports, and high levels of income and education, it is a great urban success story.

    Tel Aviv

    While much of nationalist-religious Israel is a heavily guarded borderland, Tel Aviv is a secular city with a burgeoning economy. It accounts for the majority of Israel’s high-tech exports; its per capita income is estimated to be 50 percent above the national average, and four of Israel’s nine billionaires live in the city or its suburbs.

    5. North American Alliance

    Canada, United States

    These two countries are joined at the hip in terms of their economies, demographics, and culture, with each easily being the other’s largest trade partner. Many pundits see this vast region in the grip of inexorable decline. They’re wrong, at least for now. North America boasts many world-class cities, led by New York; the world’s largest high-tech economy; the most agricultural production; and four times as much fresh water per capita as either Europe or Asia.

    6. Liberalistas

    Chile, Colombia, Costa Rica, Mexico, Peru

    These countries are the standard–bearers of democracy and capitalism in Latin America. Still suffering low household income and high poverty rates, they are trying to join the ranks of the fast-growing economies, such as China’s. But the notion of breaking with the U.S.—the traditionally dominant economic force in the region—would seem improbable for some of them, notably Mexico, with its close geographic and ethnic ties. Yet the future of these economies is uncertain; will they become more state–oriented or pursue economic liberalism?

    7. Bolivarian Republics

    Argentina, Bolivia, Cuba, Ecuador, Nicaragua, Venezuela

    Led by Venezuela’s Hugo Chávez, large parts of Latin America are swinging back toward dictatorship and following the pattern of Peronism, with its historical antipathy toward America and capitalism. The Chávez-influenced states are largely poor; the percentage of people living in poverty is more than 60 percent in Bolivia. With their anti-gringo mindset, mineral wealth, and energy reserves, they are tempting targets for rising powers like China and Russia.

    8. Stand-Alones

    Brazil

    South America’s largest economy, Brazil straddles the ground between the Bolivarians and the liberal republics of the region. Its resources, including offshore oil, and industrial prowess make it a second-tier superpower (after North America, Greater India, and the Middle Kingdom). But huge social problems, notably crime and poverty, fester. Brazil recently has edged away from its embrace of North America and sought out new allies, notably China and Iran.

    France

    France remains an advanced, cultured place that tries to resist Anglo-American culture and the shrinking relevance of the EU. No longer a great power, it is more consequential than an Olive Republic but not as strong as the Hansa.

    Greater India

    India has one of the world’s fastest-growing economies, but its household income remains roughly a third less than that of China. At least a quarter of its 1.3 billion people live in poverty, and its growing megacities, notably Mumbai and Kolkata, are home to some of the world’s largest slums. But it’s also forging ahead in everything from auto manufacturing to software production.

    Japan

    With its financial resources and engineering savvy, Japan remains a world power. But it has been replaced by China as the world’s No. 2 economy. In part because of its resistance to immigration, by 2050 upwards of 35 percent of the population could be over 60. At the same time, its technological edge is being eroded by South Korea, China, India, and the U.S.

    South Korea

    South Korea has become a true technological power. Forty years ago its per capita income was roughly comparable to that of Ghana; today it is 15 times larger, and Korean median household income is roughly the same as Japan’s. It has bounced back brilliantly from the global recession but must be careful to avoid being sucked into the engines of an expanding China.

    Switzerland

    It’s essentially a city-state connected to the world not by sea lanes but by wire transfers and airplanes. It enjoys prosperity, ample water supplies, and an excellent business climate.

    9. Russian Empire

    Armenia, Belarus, Moldova, Russian Federation, Ukraine

    Russia has enormous natural resources, considerable scientific-technological capacity, and a powerful military. As China waxes, Russia is trying to assert itself in Ukraine, Georgia, and Central Asia. Like the old tsarist version, the new Russian empire relies on the strong ties of the Russian Slavic identity, an ethnic group that accounts for roughly four fifths of its 140 million people. It is a middling country in terms of household income—roughly half of Italy’s—and also faces a rapidly aging population.

    10. The Wild East

    Afghanistan, Azerbaijan, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan

    This part of the world will remain a center of contention between competing regions, including China, India, Turkey, Russia, and North America.

    11. Iranistan

    Bahrain, Gaza Strip, Iran, Iraq, Lebanon, Syria

    With oil reserves, relatively high levels of education, and an economy roughly the size of Turkey’s, Iran should be a rising superpower. But its full influence has been curbed by its extremist ideology, which conflicts not only with Western countries but also with Greater Arabia. A poorly managed economy has turned the region into a net importer of consumer goods, high-tech equipment, food, and even refined petroleum.

    12. Greater Arabia

    Egypt, Jordan, Kuwait, Palestinian Territories, Saudi Arabia, United Arab Emirates, Yemen

    This region’s oil resources make it a key political and financial player. But there’s a huge gap between the Persian Gulf states like Saudi Arabia and the United Arab Emirates and the more impoverished states. Abu Dhabi has a per capita income of roughly $40,000, while Yemen suffers along with as little as 5 percent of that number. A powerful cultural bond—religion and race—ties this area together but makes relations with the rest of the world problematic.

    13. The New Ottomans

    Turkey, Turkmenistan, Uzbekistan

    Turkey epitomizes the current reversion to tribe, focusing less on Europe than on its eastern front. Although ties to the EU remain its economic linchpin, the country has shifted economic and foreign policy toward its old Ottoman holdings in the Mideast and ethnic brethren in Central Asia. Trade with both Russia and China is also on the rise.

    14. South African Empire

    Botswana, Lesotho, Namibia, South Africa, Swaziland, Zimbabwe

    South Africa’s economy is by far the largest and most diversified in Africa. It has good infrastructure, mineral resources, fertile land, and a strong industrial base. Per capita income of $10,000 makes it relatively wealthy by African standards. It has strong cultural ties with its neighbors, Lesotho, Botswana, and Namibia, which are also primarily Christian.

    15. Sub-Saharan Africa

    Angola, Cameroon, Central African Republic, Congo-Kinshasa, Ethiopia, Ghana, Kenya, Liberia, Malawi, Mali, Mozambique, Nigeria, Senegal, Sierra Leone, Sudan, Tanzania, Togo, Uganda, Zambia

    Mostly former British or French colonies, these countries are divided between Muslim and Christian, French and English speakers, and lack cultural cohesion. A combination of natural resources and poverty rates of 70 or 80 percent all but assure that cash-rich players like China, India, and North America will seek to exploit the region.

    16. Maghrebian Belt

    Algeria, Libya, Mauritania, Morocco, Tunisia

    In this region, spanning the African coast of the Mediterranean, there are glimmers of progress in relatively affluent countries like Libya and Tunisia. But they sit amid great concentrations of poverty.

    17. Middle Kingdom

    China, Hong Kong, Taiwan

    China may not, as the IMF recently predicted, pass the U.S. in GDP within a decade or so, but it’s undoubtedly the world’s emerging superpower. Its ethnic solidarity and sense of historical superiority remain remarkable. Han Chinese account for more than 90 percent of the population and constitute the world’s single largest racial-cultural group. This national cultural cohesion, many foreign companies are learning, makes penetrating this huge market even more difficult. China’s growing need for resources can be seen in its economic expansion in Africa, the Bolivarian Republics, and the Wild East. Its problems, however, are legion: a deeply authoritarian regime, a growing gulf between rich and poor, and environmental degradation. Its population is rapidly aging, which looms as a major problem over the next 30 years.

    18. The Rubber Belt

    Cambodia, Indonesia, Laos, Malaysia, Philippines, Thailand, Vietnam

    These countries are rich in minerals, fresh water, rubber, and a variety of foodstuffs but suffer varying degrees of political instability. All are trying to industrialize and diversify their economies. Apart from Malaysia, household incomes remain relatively low, but these states could emerge as the next high-growth region.

    19. Lucky Countries

    Australia, New Zealand

    Household incomes are similar to those in North America, although these economies are far less diversified. Immigration and a common Anglo-Saxon heritage tie them culturally to North America and the United Kingdom. But location and commodity-based economies mean China and perhaps India are likely to be dominant trading partners in the future.

    This article originally appeared in Newsweek.

    Legatum Institute provided research for this article.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University and an adjunct fellow with the Legatum Institute in London. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

    Illustration by Bryan Christie, Newsweek

  • China Development: Go West, Young Comrade

    Deng Xiaoping, the pragmatic leader who orchestrated China’s ‘reform and opening-up’ 30 years ago, once said that “some areas must get rich before others.” Deng was alluding to his notion that, due to the country’s massive scale, economic development could not happen all at once across China. Planning and implementation of such an economy would take years, even decades, and some areas would inevitably be developed before others.

    The logical place to start was the coastal regions of China, with the natural advantage of access to Asian and overseas markets via the South China Sea and Pacific Ocean. Not surprising then that the two areas that benefited most after initial economic reforms were the Yangtze River Delta region in the east and Pearl River Delta region in the south. Both places became international manufacturing centers with numerous factories and busy seaports.

    Today, the prosperity of the Yangtze River Delta can be experienced in Shanghai, ‘the Pearl of the Orient’- undoubtedly China’s most modern and cosmopolitan city. Down south in the Pearl River Delta, the city of Shenzhen, chosen by the Central Government as a ‘Special Economic Zone’ in 1980, transformed from a small fishing village to a bustling metropolis of nearly 10 million people in a mere 30 years. Both places best represent China’s economic achievements of the recent past.

    Although China’s coastal regions continue to develop, the initial boom has already slowed. Furthermore, foreign investors are beginning to grow weary by the increasing costs of doing business in cities like Shanghai and Shenzhen. Now both international and domestic businesses have their eyes looking towards the interior of the country, where overhead costs are lower and the cities are building the necessary infrastructure to support growth.

    China’s vast western region will be perhaps the most exciting economic development story of the next decade. The country’s west includes 6 provinces, 5 autonomous regions and 1 municipality. Overall the entire region comprises a whopping 70% of China’s landmass and 28% of its population. It also currently accounts for 17% of the country’s GDP, but that is set to change for the better.

    In 2001, the Chinese government implemented its Western Development Strategy also known as the ‘Go West’ campaign. The lagging economic progress of the region prompted the Central Government to offer incentives for business development, including a 10% corporate income tax reduction. The plan also calls for massive infrastructure development both in urban and rural areas.

    Nearly 10 years after the beginning Western Development Strategy, the positive effects are evident in the region’s largest cities. The key cities that have benefitted most so far are Xi’an (capital of Shaanxi Province), Chengdu (capital of Sichuan Province), Kunming (capital of Yunnan Province) and Chongqing (a direct-controlled municipality). These cities form a tight bond, and despite each being within a less than 2 hour flight from one another, each is unique in character and culture.

    At the center of this prosperity is the Chengdu-Chongqing Megaregion. About 200 miles apart from each other, the two cities form a combined urban population of about 10 million people. Chengdu and Chongqing are the principal economic, government, and cultural centers that serve a regional population of nearly 110 million (the combined population of Sichuan Province and Chongqing Municipality). Given these demographics, the potential for growth in these two cities is enormous.

    In the past, like the ambitious living in our own heartland, those from China’s interior were forced to leave home for the far-off coastal regions to benefit from the country’s economic growth. Migrant workers from Sichuan had it especially difficult, facing employment discrimination due to their strong local accent (seen as low-class by the eastern cosmopolitans) and the misperception that they are lazy workers. Today, the rise of Chengdu-Chongqing Megaregion means that workers from Sichuan need not go far from home in order to find opportunity. This is a considerable departure from China’s migrant worker narrative of the past 30 years.

    Increasingly what you see today is a reversal of past emigration trends, as not only young people from the Chengdu-Chongqing Megaregion opt to stay close to home but people from other regions relocate to the interior to take advantage of the growth.

    There is a bit of a rivalry between the cities of Chengdu and Chongqing, with much talk about which of the two will become western China’s most important city. In reality they are more like ‘sisters’ as both cities stand to benefit. As my American friend who lived in the area for over 10 years described the relationship, “Chengdu is the fat provincial nobleman to Chongqing’s beer and hot pot steel worker.”

    In the case of Chongqing, he is referring to the importance of the city as an industrial center, both in metal manufacturing and natural resource mining (the surrounding area is rich in coal and natural gas). In contrast, Chengdu is quickly becoming a major player in China’s information technology sector.

    Much of this has to do with Chengdu’s advantageous geography. Whereas the surrounding terrain in Sichuan and Chongqing is mountainous and hilly, Chengdu lies in a flat, fertile basin, allowing the city to sprawl out. Dubbed the ‘Land of Abundance’ for its long history of agricultural prosperity, Chengdu is today abounding in domestic and foreign investment in high-tech.

    The local government has set up the ‘Chengdu Hi-Tech Industrial Development Zone (CDHT)’ with 2 locations: the South Park and the West Park. Both areas lie outside the historical city center and are being built on previously undeveloped land. The character of the CDHT is not the dense urban forest of supertall skyscrapers that characterizes other Chinese cities. Rather, a series of modern low-rise office parks can be seen popping up in the CDHT, not dissimilar from what can be found close to where I grew up in Silicon Valley.

    Already, international IT behemoths like Intel have established operations in the CDHT, having opened semiconductor assembly and testing facilities. Other American companies look to expand in the CDHT. Just a few days ago Dell Computer announced it would open an operations center in Chengdu, creating 3,000 new jobs. Cisco Systems has also been involved in Chengdu, collaborating with local institutions like the University of Electronic Science and Technology of China in research and development.

    Chengdu attracts foreign investment not only because of its lower cost-value compared to other cities in China but because of its efficient infrastructure and logistics. Chengdu’s Shuangliu Airport is national airline Air China’s third major traffic hub after Beijing and Shanghai. The city is also undergoing the construction of a comprehensive subway system with the first line scheduled to open in on October 1st. This line, Line 1, will connect the historic center of the city with the South Park area of the CDHT- making commuting for IT workers who live in the city more reasonable.

    Most interestingly, Chengdu is also promoting quality of life when courting business investment. The local government has established what is called a ‘Modern Garden City’ to keep in line with the city’s history as an agricultural base. The sense of the past is strong with locals, and Chengdu is doing everything to preserve this despite the development.

    If Deng Xiaoping were still alive today, he would probably be proud to see Sichuan flourishing- after all it is the patient pragmatist’s native region.

    Adam Nathaniel Mayer is an American architectural design professional currently living in China. In addition to his job designing buildings he writes the China Urban Development Blog.

    Photo by Toby Simkin