The Heart of the Dragon: Shanghai's Future Has Arrived
Total Page：16
File Type：pdf, Size：1020Kb
November 4, 2012 Prepared for Shanghai International Business Leaders Advisory Council (IBLAC) The heart of the dragon: Shanghai’s future has arrived Contents I. Executive summary 02 Harnessing the power of attraction II. Context: Shanghai and Cities of Opportunity 06 Directing growth in “a cradle of talent” III. Recommendations 14 Moving ahead: From higher education to sustainability to culture and cohesion IV. Conclusions 24 “Future city” of the 21st century I. Executive summary 2 PwC Harnessing the power of attraction By Dennis Nally, Global Chairman, PwC It is not easy to discuss Shanghai coolly.1 An immediate problem is that, like all of the world’s great cities—New York and Paris, of course, but also San Francisco and Buenos Aires, Berlin and Istanbul—the mere mention of its name summons up more myth than reality. It is especially difficult to separate fact from fiction when the city’s appeal—famously dubbed “Shanghai modern” or “Shanghai style”2—has radiated a magnetic attraction for almost a century. And yet, having an extraordinary who deny the importance of soft power image is an enormous advantage for are like people who do not understand any city—as New York and Paris can the power of seduction.”3 Indeed, Nye’s attest—for the simple reason that a book on soft power is essentially a city’s power is so closely aligned with treatise on attraction. “Political leaders its attraction to the rest of the world have long understood the power that outside it. In the words of the man who comes from attraction,” he writes. invented the concept of “soft power,” “Simply put, in behavioral terms soft the former dean of Harvard’s Kennedy power is attractive power. In terms of School of Government and assistant resources, soft-power resources are the secretary of defense in the Clinton assets that produce such attraction.”4 Administration, Joseph Nye, “Those 1 Except as indicated below, the data in this article are from research undertaken by PwC and Oxford Economics specifically for this paper. 2 See Leo Ou-Fan Lee’s Shanghai Modern: The Flowering of a New Urban Culture in China, 1930-1945, for example, or Shanghai Modern: 1919-1945, edited by Jo-Anne Birnie Danzker, Ken Lum, and Zheng Shengtian. See also Shanghai Style: Art and Design Between the Wars by Lynn Pan. This is not the place for a discussion of hai pai (or Shanghai style) versus jing pai (or Beijing style). Suffice it to say that hai pai was considered, by enthusiasts and detractors alike, as more contemporary and popular (and even rebellious), while jing pai was more traditional and elitist. For a brief overview of hai pai, see the “The Culture of Shanghai” on the Chinese ministry of culture’s Website, Chinaculture.org, at http://www.chinaculture.org/gb/en/2006-08/28/content_85051.htm. For a more detailed analysis, see the work by the eminent French Sinologist, Marie-Claire Bergère, Shanghai: China’s Gateway to Modernity, 2009, translated from the French edition, Histoire de Shanghai, by Janet Lloyd. Hai pai is the subject of Chapter 10, “Haipai and the Ideal of Modernity.” 3 Joseph S. Nye, Jr., Soft Power: The Means of Success in World Politics, 2004, p. 8. 4 Nye, Soft Power; the two quotes are from p. 6. In the book’s index, the term “attractiveness” includes almost 60 entries. The heart of the dragon: Shanghai’s future has arrived 3 GDP growth 2003–2011 (annual(annual % % growth) growth) ForecastForecast GDP GDP growth growth 2011–2025 2011–2025 (annual (annual % %growth) growth) Shanghai Mumbai Mumbai Shanghai Beijing Beijing Buenos Aires Istanbul Singapore Johannesburg Sao Paulo Kuala Lumpur Kuala Lumpur Sao Paulo Hong Kong Singapore Johannesburg Hong Kong Stockholm Sydney Istanbul Buenos Aires Moscow Abu Dhabi Sydney Seoul New York Mexico City Mexico City Moscow Seoul Los Angeles Madrid New York Berlin London San Francisco Stockholm London San Francisco Los Angeles Milan Paris Madrid Chicago Berlin Tokyo Paris Milan Tokyo Abu Dhabi Chicago -5% 0% 5% 10% 15% 0% 5% 10% 15% Source: Oxford Economics If such a thing is possible, Shanghai And if there is any city in the world the city was acclaimed as “the great today beckons even more power- today capable of developing vast Athens of China.”5 fully than it did in the past. This time, concentrations of soft-power resources, though, the lure is the result of the it is Shanghai. In doing so, however, The truth, of course, as the distin- city’s reality and not of any illusory China’s most prosperous city and the guished Shanghainese historian, Zhang image. In a transnational context of world’s largest should not be afraid to Zhongli, wrote a decade and a half continual globalization and urbaniza- strike out on its own or, more accu- ago—when contemporary Shanghai tion, Shanghai is increasingly playing rately, to define the terms of its develop- a critical role among the great cities of ment in its own way and according to 5 For “New York of the West,” see Jeffrey the world beyond anything that could its own history and understanding of N. Wasserstrom, Global Shanghai, have been imagined even at the time of its future. One of Shanghai’s greatest 1850-2010, 2009, p. 1, who quotes the guidebook, All About Shanghai its greatest renown decades ago. achievements in the twentieth century and Environs. For “great Athens of was to liberate itself from others’ defini- China,” see the book written in 1899 by tions of it. Everyone knows the label, Constance F. Gordon-Cumming, The inventor of the numeral-type for China “Paris of the East.” In 1934, a guidebook by the use of which illiterate Chinese eccentrically added, “New York of the both blind and sighted can very quickly be taught to read and write fluently, West.” More than thirty years earlier, which can be found at the Internet Archive at http://www.archive.org/ stream/inventorofnumera00gordiala/ inventorofnumera00gordiala_djvu.txt. 4 PwC GDPGDP changechange 2003–2011 2003–2011 ($ ($ millions, millions, 2012 2012 prices) prices) ForecastForecast GDP GDP change change 2011–2025 2011–2025 ($ ($millions, millions, 2012 2012 prices) prices) Shanghai Shanghai New York Beijing Singapore New York Beijing Sao Paulo Sao Paulo Singapore Hong Kong Sydney Sydney London Moscow Hong Kong London Istanbul Seoul Seoul Istanbul Moscow Buenos Aires Tokyo Mexico City Los Angeles Los Angeles Mexico City Mumbai Mumbai Stockholm Toronto Toronto Abu Dhabi Paris Buenos Aires Madrid Paris Berlin Johannesburg Johannesburg San Francisco Kuala Lumpur Kuala Lumpur San Francisco Madrid Chicago Stockholm Tokyo Chicago Milan Milan Abu Dhabi Berlin -50 0 50 100 150 200 250 300 350 400 450 500 550 600 -50 0 50 100 150 200 250 300 350 400 450 500 550 600 Source: Oxford Economics had just embarked on its current, That Shanghai is neither New York nor breathtaking path of growth—is Paris is not only a historical fact but a that “Shanghai is not like London or guide to future action. This is not to say Paris....She is not like New York.... that Shanghai should not learn from Shanghai’s development path has been the experience of other cities. Quite the unique. Shanghai is just Shanghai.”6 opposite, this paper’s recommendations It is precisely because Shanghai is are based on best practice from around Shanghai, with its own history and the world. But even best practices need expectations for the future, that it to be “naturalized”—that is, conformed should avoid mechanically emulating to the realities and requirements of the other cities, which invariably have both context in which they are adopted. a very different urban experience and an equally different trajectory into the future. 6 Quoted in Wasserstrom, Global Shanghai, p. 133. The heart of the dragon: Shanghai’s future has arrived 5 2. Context: Shanghai and Cities of Opportunity 6 PwC Directing the quality of growth in “A cradle of talent.” The city of Shanghai knows exactly what it needs to do to capi- talize on its progress to date. At the conclusion of the 10th Municipal Congress of the Communist Party of China in May, newly elected Party secretary Yu Zhengsheng told journalists that the new Party committee would “work all out to meet people’s expectations of accelerating Shanghai’s growth and making Shanghai a better city,” and that the municipality would “solidify its position in reform and opening up.” The report issued by the Congress set a number of goals for the next five years described as both “practical and reflect[ing] the common wishes of ordinary people.” Specifically, it proposed that Shanghai: • Aim at raising its GDP per capita to $20,000 from the current $12,800; • Increase the output of its service sector to over 65% of total economic output from 57.9% last year; and • Foster innovation by spending 3.3% of GDP in research and devel- opment, up from 2.9% currently.7 But what is probably even more people were “happy when living and important than the economic goals working in the city.” In summarizing set by the Congress was the focus paid past work and setting future goals, the to the quality of growth and to the need Shanghai Party committee itself repeat- to direct that quality in ways that better edly stressed the “cultivation of profes- the lives of the men and women who sionals,” with the priority being the live and work in Shanghai. Secretary “the comprehensive development Yu told delegates to the Congress that of people.”8 municipal and Party authorities had to “continue to improve business, the Without a doubt, the “comprehensive residential and transport environments, development” of its citizens is the key to and create better conditions to stimu- Shanghai achieving its goals.