November 30, 2016

China will spend trillions to create its three giant integrated megaregions

China aims to fund infrastructure and public projects worth 10.6 trillion yuan ($ 1.6 trillion) through public-private partnerships (PPPs) to leverage investment from the private sector

Authorities aim to fund a total of 9,285 infrastructure and public service projects through PPPs, said Shi Yaobin, China's vice finance minister, at a forum in Shanghai.

Yangtze River Delta megacity

Shanghai is at the core of the larger Yangtze River Delta, home to nearly 160 million residents crowded into an area the size of Oregon. The Yangtze Delta includes the provinces of Zhejiang, Shanghai and Jiangsu and stretches from Ningbo, through Hangzhou, Shanghai, Suzhou, Changzhou, and Zhenjiang to Nanjing.

China is merging the cities in the area into a unified megaregion using high speed rail and other infrastructure.

There are about 170 million people in the area now but should have about 260 million in ten to fifteen years as the full integration is achieved.



With 20% of the GDP of China, this area already has about $2.2 to 2.5 trillion (nominal) in GDP and should be about $3 to 3.5 trillion in 2020 and about the level of Japan's GDP before 2030.

Per capita GDP is already at US$15,000 per person and should be $20,000 by 2020 and $30,000 per person before 2030. On a Purchasing power parity basis the whole YRD is almost at $25000 per person already.



The two other main megaregions in China are Beijing-Bohai area and the Guangzhou-Pearl River Delta area

The three major economic mega-urban zones are the pearl river delta in the south (merging into one current 42 million person city and then eventually 80 million) and Yangtze River delta around Shanghai and the Bohai economic rim

The area around Beijing and Tianjin, two of China's most important cities, is being ringed with a network of high-speed railways that will create a super-urban area known as the Bohai Economic Rim. China is merging Beijing/Tianjin and several other cities around the Bohai Sea into one big super-urban zone over the next several years. By 2020 there could be 260,000,000 people (3% of the world's population) in one big super-city.

The 260 million people would be around the population level of the United States back in early 1990. The Region currently is between the population of Russia and Brazil.

President Xi Jinping has a signature project to link 130 million people across Beijing, Tianjin and Hebei province into a single megalopolis, the so-called Jing-Jin-Ji region. This would be a megaregion with the population of Japan.



The Bohai Bay area would become a key growth plank, similar to the Yangtze River Delta and Pearl River Delta. Vice-Minister of Finance Wang Baoan has said the new metropolis would require an investment of 42 trillion yuan (HK$52.7 trillion) over the years. The region's gross domestic product was US$1 trillion last year, similar to South Korea's, and the 15th highest in the world. But wealth is spread unevenly: per-capita GDP of Beijing is US$15,000, while Tianjin's is US$11,500 and Hebei's only US$6,300.

Pearl River Delta

China will spend over $300 billion to integrate Hong Kong and Shenzhen and the other cities of the Pearl River delta. It should have about 80 million people in ten to fifteen years. This would be about the population of Germany


The Pearl River Delta grew from 4,500 square kilometres in 2000 to nearly 7,000 sq km in 2010, the analysis found. Treating the Pearl River Delta as a single urban area, it is now bigger than Tokyo in terms of geographical size and population.



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