Shanghai The Becoming Thing
Believe the Hype?

In Shanghai hype is part of the landscape. A sign outside number 6 The Bund promises that the still boarded building will ‘enrich Shanghai’s heritage.’ When the concealed construction is unveiled it will give locals and visitors the ‘chance to experience the glamour of the Bund like the old days of Shanghai.’ The project is only the latest addition in the rejuvenation of Shanghai’s premier tourist attraction. The Bund, a string of early 20th century neoclassical structures, which line the western bank of the Huangpu River, was once home to European banks, businesses and shipping offices. Today it is being revitalized to match the opulent sophistication of its now mythic origins.  In the past year the old Chartered Bank of India, Australia and China at Bund 18 and the former Union Assurance building at ‘Three on the Bund’ were reopened after multimillion dollar renovations. Inside, restaurants like Laris, Jean Georges and the Whampoa Club offer US$150 dollar meals of foie gras, shark fin soup and other Chinese and Western delicacies. The buildings also house the flagship stores of Cartier and Armani, a contemporary art gallery, a luxury spa and designer bars with rooftop terraces. What is most dazzling, however, is the view across the river. Past the shipping boats that sail towards the Yangtze, on the east bank of the Huangpu is the sci-fi spectacle of Pudong, where a dense cluster of skyscrapers, giant TV screens, laser beam lights and the ubiquitous cranes of half finished buildings, mirror the monument to Shanghai’s colonial past with a spectacular image of its future.

Shanghai is China’s showcase city - its icon to progress.  As the window onto the country’s modernization, Shanghai is the face of China’s development (which is why stories about the country’s rise are nearly always accompanied by an image of the city’s skyline). Shanghai is where you come if you want to see what over a decade of double-digit growth looks like. As such, Shanghai is less a place than a process. The city is inherently unstable (the very name ‘Shanghai’ means ‘on the sea’ and the city itself is sinking).  In the last ten years especially it has undergone relentless mutation. Today Shanghai is hardly more familiar to locals than it is to newcomers. Maps become outdated the moment they are drawn. Skyscrapers rise in months. Whole communities are regularly relocated and parklands are continuously being expanded (in 2004 Shanghai achieved a target of 35% green space and was officially dubbed one of China’s ‘national garden cities’).

The Shanghainese accept the noise and disruption of this massive change as the inevitable consequence of development. Yet, while Shanghai is unquestionably ‘developing,’ it is no longer clear what it is aiming to catch up with. To locals traveling abroad, even places as dynamic as Singapore already seem ‘old.’ One government worker, after visiting New York, admitted to being shocked by the paucity of new buildings. It is usually assumed that between the ‘developing’ and ‘developed’ world lie distinct stages of growth. Shanghai suggests something different: developing as a continual state of being, urban existence as perpetual becoming, without destination. It is this orientation towards the future that allowed director Michael Winterbottom to make his science fiction film Code 46 without using any special effects. All he had to do was set it in Shanghai.

Shanghai embodies conspicuous development by combining its super-modernity with a deep sense of nostalgia. This is evident in projects like Xintiandi (literally ‘new heaven and earth’), a zone in the downtown core that revitalizes traditional shikumen architecture (a type of turn of the century stone tenement housing unique to Shanghai ) by transforming it into trendy restaurants, outdoor cafes and fashionable boutiques.

This ‘new Shanghai’ deliberately recalls the city’s decadent heyday of almost a century ago with its opium dens, jazz bars and gangsters like Pockmarked Chen and Big Ears Du. (The period’s cinematic allure will soon hit the big screen with Merchant Ivory’s upcoming film ‘The White Countess’).

Until colonial powers began using it as a commercial hub, Shanghai was little more than a fishing village. By the turn of the century, however, it had become a center of international finance and trade and one of the world’s great modern cities. Shanghai’s culture and population is inherently and explicitly cosmopolitan. At its height the city lured not only businessman but also refugees. Most famously it was once home to tens of thousands of Jews. These ranged from rich Sephardic families like the Sassoons and Kadoories, whose legacy includes some of the finest colonial buildings in the city, to refugees from the Bolshevik revolution, and from Nazism who found shelter in Shanghai, one of the only ports in the world which did not require an entry visa. In the old Jewish ghetto of Hongkou, where Jews were concentrated during the Japanese occupation, one could find Jewish newspapers, Yiddish theatre, violin concerts, European coffee shops, dance clubs and sports activities. Today this area has been slated for redevelopment and people from the international Jewish community are working with Chinese officials to preserve its cultural heritage and restore it as a living symbol of Shanghai’s cosmopolitan past.

With the Japanese invasion and subsequent communist takeover of the city Shanghai, like the rest of China, closed its doors to the world. It was not until 1978, when at the pivotal 11th Party Congress meeting of the Central Committee, Deng Xiaoping introduced his transformative policies of openness and reform, that the country began its current rise. Deng’s strategy, which was based on experimentation and ‘learning through facts’, involved the establishment of special economic zones in cities like Shenzhen, which could test, and then illustrate, the merits of market reform.

Too important to be used as a laboratory, Shanghai was left out of this initial period of growth (though Deng later admitted regretting this decision). For the first decade of China’s reforms the city was hobbled by restrictive economic policies and an immense tax burden (in the early 1980s, 70-80% of the entire national tax revenue came from the municipality of Shanghai alone.) It was not until the early 1990’s with Deng Xiaoping’s tour of the south and the promotion of Jiang Zemin and Zhu Rongji (both former mayors of Shanghai) that the central government turned its attention to China’s largest commercial center. In the next decade, under the leadership of what has come to be known as the ‘Shanghai clique’, the government began reducing the burden on Shanghai (even after 1992, however, Shanghai's tax contribution to the central government is around 20-25% of the national total). It also strongly encouraged both foreign and domestic investment, promoting the city as an economic hub. Once unleashed, the city’s economy immediately began growing between 9-15% annually, a rate it has maintained for the past 13 years.

The most dramatic image of this literally spectacular progress is the ‘Pudong New Area’. Ten years ago the area east of the Huangpu was considered barren and remote. ‘Better to have a bed in Puxi’ (west of the Huangpu), the old saying goes, ‘than a house in Pudong.’ Today Pudong can be reached through a network of bridges and tunnels and has over 1,000 built or semi-built skyscrapers including the gaudy pink-balled Shanghai Oriental Pearl TV Tower, the ultra-elegant Jinmao Tower and the 101 story Shanghai World Financial Center, which is due to open in 2008.

Pudong is being built from a blueprint. It’s wide, well planned boulevards, neat rows of apartment complexes and complete lack of sedimentation gives it a Legoland feel. To its critics it is an emblem of a city that is all show and no substance.  Scorned by free market economist Milton Friedman as the “statist monument for a dead pharaoh” Pudong, like much of Shanghai, was built on the back of government loans and is a prime example of the Chinese penchant for top-down growth. The seeming disjunction between appearance and reality infects the entire city. The elaborate illumination along the banks of the Huangpu, for example, masks severe electricity shortages in surrounding areas. Shops, restaurants and houses for the rich are being built and serviced by a floating population of 3 million migrant workers – part of the largest process of urbanization ever recorded. Yet, Shanghai’s self-image as an immigrant city pays scant homage to its present migrants – from the country’s interior - who can be seen dangling from skyscraper scaffolding or struggling to negotiate escalators and subway turnstiles. The Shanghai Star a local English language weekly, reports on this common criticism by quoting a Hong Kong newspaper: “Through sheer chutzpah and public relations guile Shanghai's super-smooth politicians somehow dissuade foreign investors, leaders and even journalists from looking too closely at their fair city's facade... Shanghai is arguably a Potemkin village on a massive scale.”

Nowhere is the hype over ‘new Shanghai’ more heatedly debated than in the real estate sector. From 1998 to 2002, Shanghai tore down 15 million square meters of old neighborhoods and developed more than 80 million square meters of new residential land, an amount equivalent to 20% of the city's total residential space. Many Shanghai residences have felt the impact of this growth as a direct rise in living standards, moving from small single room flats to two or three bedroom apartments. In addition there has been an exponential increase in the rise of luxury serviced apartments and sprawling suburban villas. Almost all these properties have doubled or even tripled in value over the past 5 years. This surge in prices - close to 15% last year alone - has been fueled by speculative buying by foreigners, rich Shanghainese and nearby entrepreneurs (who have few other places to put their savings).  Recently the government, aware that even the middle class can no longer afford property inside the inner ring road has introduced a number of policies aimed at curbing growth and dampening speculation. Yet, though there has been a downturn in recent months, no one yet knows how deep it will go and how long it will last.
A similar skepticism haunts the luxury brand market. Drawn by promises of the largest market in the world, big name brands have set up lavish headquarters in Shanghai at enormous expense. Their products, however, are wildly unaffordable. At the exquisite Shiatzy Chen, for example, which specializes in ‘neo Chinese chic,’ jackets start at 5,000 yuan, well over the average monthly salary of a middle class professional. The closest most Shanghainese will ever get to owning an Armani is by buying one of the many fake replicas sold in Xiangyang market.

Nevertheless, in Shanghai, hype has become a commercial reality. By adopting a philosophy of “build it and they will come” the city has successfully blurred the distinction between image and reality. Pudong, for example, has been growing at a rate of approximately 20% per year and is now home to a new international airport, the Lujiazui Finance & Trade Zone, the Zhangjinag Hi-Tech Park, the Waigaoqiao Free Trade Zone and the Jinqiao Export processing zone, which is now the site of a luxury suburban village that rivals the previous prime expat location in the Hongqiao area of Puxi.  Pudong has attracted US$38 billion of overseas investment in total from more than 150 Fortune 500 companies.

Shanghai is China’s window to the world and the world’s gateway into China. At the height of the SARS epidemic, when there was a fear that China may have to seal its doors, rumors were that Shanghai would stay open. It had supposedly been officially decided that it would be better to cut Shanghai off from the interior of the country than to de-link it from the outside world.  Shanghai is the largest economic and transportation center in China. As the 'dragon's head' of the Yangtze River delta it is the trade and communications hub for
Jiangsu and Zhejiang provinces - its highly entrepreneurial neighbors - where the majority of the world’s socks, lighters and other essentials are made. In 2004, Shanghai’s foreign trade volume totaled over US$160 billion, up 42.4% over the previous year. The city currently has the world’s third biggest port - a ranking it hopes to upgrade with the recent opening of the Yangshan Deep Water Port.  In 2004, the total value of import and export goods under Shanghai Customs supervision and control reached US $282.6 billion, representing a 40.4% increase over the previous year and constituting close to 25% of the nation’s total.

Despite these fundamentals, Shanghai’s economy, like modern economies everywhere, is increasingly built on hype. Once a manufacturing center, it has moved up the value chain to concentrate on the development of finance, service and creative industries, research institutes, fashion, PR, exhibitions, advertising and hospitality. This shift seems to suit the Shanghainese well. Their reputation draws upon stereotypically feminine traits – they are considered fashionable, materialistic, calculating, seductive and shrewd. The Shanghainese themselves say they are like Americans: No one likes them but everyone wants to be one. In China, Shanghai offers the closest thing to the American dream.

On a corner of People’s Square in downtown Puxi, the Shanghai Urban Planning Exhibition Hall stands as a high tech monument to the city’s growth. One of Shanghai’s most elegant pieces of architecture, the five story museum is filled with neon signs, plastic models, backlit photos and piped uplifting music all designed to dramatically portray the city’s future. The highlight of the museum is a massive model of what the entire city will look like in 2020.  After a visit to the Urban Planning museum it is clear that to live in Shanghai is to inhabit an unfolding blueprint for development.

Above the doorway to the museum is a sign, which in the weird lingo of Shanghai public propaganda reads ‘Keep Pace with the Times. Blaze New Trails in a Pioneering Spirit.’ Beneath these words is a digital readout, counting down to the 2010 Shanghai World Expo. Billed as an ‘economic Olympic games,’ Shanghai will spend close to US $4 billion on this event. Preparations involve major infrastructure projects including the construction of tunnels, bridges and a ‘low speed maglev,’ the expansion of subway lines and the relocation of 10,000 households. Government representatives see it as an opportunity for a ‘new round of development’ and call it a ’high speed engine’ that will ‘see the emergence of a brand new Shanghai.’  Everyone’s expecting a real spectacle.