The New Megacity Xiongan

On April 3rd, all the real estate companies were forced to shut down in Xiongxian, a county in Xiongan Area, where the police chased real estate speculators soon after the region was established. You might wonder what escalated the situation and led to police violence, so let me give a brief introduction to Xiongan Area first.

On April 1st 2017, the Chinese Communist Party’s Central Committee and the State Council decided to establish a national new area in Xiongan, encompassing three counties of Xiongxian, Roncheng and Anxin. The foundation of the area is another crucial strategic choice proposed by the party after the establishment of the Shengzhen Economic Zone and Shanghai Pudong New Area. The Xiongan New Area has ample natural resources, including natural gas, oil, subterranean heat, and mineral resources, and has an excellent ecosystem with various species of plants and animals.

Initially, the Chinese government desired to offer a solution for the problems faced by Beijing with the Xiongan project. The plan will adjust Beijing’s spatial structure to relieve the pressure of population, and provide a new mode to improve high populated areas. In addition, it will transform the industry structure to make the businesses environmental friendly. Moreover, the plan will facilitate the relocation of non-capital functions from Beijing to its surrounding vicinity, bringing a population of 20 million people to the labor force in underdeveloped regions.

However, the government’s stated vision is now more ambitious than the original goals. They seek to emphasize the innovation and advanced technology in business clusters in order to reactivate growth in the regions of Pearl River Delta and Yangtze River Delta after the economic recession. In addition to economy and infrastructure, the plan also focuses on the continuity of culture in the Xiongan New Area. The government will fund a project to collect regional folklore and preserve local tradition.

Naturally, many real estate agencies perceive this as an opportunity to invest in housing, and they overcrowded the area soon after the establishment of the area. The government quickly issued a ban on real estate purchases to prevent the rising prices in housing, and ensure low-income citizens can afford to live in the area, which results in the scene in the beginning of this article. The CCP plans for the new area to achieve sustainable development and improve the residents’ living standards while prevents unethical profiting on the housing market and further aggravation of the economy. Despite conflicting interests between government and investors, the new area is already attracting new talent to contribute to its growth. After government’s initiative to develop the new area, more PhDs come to the area to seek career advancements.

The plan for the Xiongan Area bears witness to conflicting interest between Chinese businesses and the government. It is yet to be seen whether the Xiongan New Area is capable of ensuring China’s holistic developments by maintaining citizens’ welfare while creating ample businesses opportunities for enterprises.