China’s Building Sprawl & GDP, both Huge

Upon arriving in the incredibly vast country of China, I quickly realized everything operated on a different scale, a much, much larger scale that is. The great state of Texas likes to claim, “everything’s bigger in Texas”, and while this may be true for their steaks and ten-gallon hats, it is most certainly not true when compared to China’s vast infrastructure, connecting most of the country’s major metropolitan areas, or, their buildings. High in both count and height, China’s buildings sprawl in every direction, are in an immense variety of shapes and sizes, serve varying purposes, but most notably, they are simply everywhere.

In the major downtown areas, these buildings primarily serve as office buildings, hosting a vast number of businesses and employees, while the remainder, of what seems like billions of buildings, are purposed as housing for China’s ever-growing population. Not only is the population constantly increasing, but the government is continuing its push to move people from the more rural parts of the country into the metropolitan areas. Unlike in America, land of the free, home of the brave, China is under a communist regime whereas a citizen, you do not necessarily have the freedom to choose where you live, or what you do. Under China’s New-type Urbanization Plan (NUP), the government aims to move nearly 250 million people from their rural farmlands, into newly built urban sprawls. Fueling this agenda is the government’s desire to expand domestic demand, and to become a more dominant player in the global economy through facilitating the connectivity and growth of the country.

To put that number in perspective, America’s entire population is around 325 million. So, this New-type Urbanization Plan, that is currently in motion and underway is the equivalent of moving over two-thirds of the U.S.’s entire population. Well, where do you put 250 million newly moved and formerly more rural individuals? You guessed it, into massive buildings that sprawl in every direction out of metropolitan areas around the country. The philosophy of, “build, and they will come”, holds ever true in this massive population shift scenario. To facilitate this movement, the Chinese government partners with Chinese national companies to develop these large-scale housing investments. But, one blaring oddity stands out with this development process. Entire gigantic, well built, beautiful, metropolitan areas, complete with shops, public art, bridges, and water features, are built and completed often months, or even years before any residents arrive. As a result, China is dotted with what looks to be masterfully built, enormous, elegant ghost towns. Commonly, as you are coming into larger cities via train or bus, you will gaze out of your window and suddenly see what looks to be a well-articulated, immense in scale, city with no movement and zero people and it honestly leaves you feeling a bit uneasy.

These investments, while facilitating urbanization growth in the country, also drive a major boost in the country’s GDP, and thus it’s economy. Much of China’s staggering GDP growth over the past five to ten years can be attributed to their colossal overhaul of infrastructure and development.  In addition, the recent slowing of the country’s annual GDP growth can likely be attributed to the fact that they have reached a point in their journey of modernization where most of the incredibly huge projects that fueled their growth have already been completed. Essentially, the low hanging fruit has been picked, and now China is in a position where they must get creative and continue to innovate, facilitate, and create to drive their economy forward and remain one of the dominant world economies.

Russell J. Flournoy

MBA Candidate, 2018