By staff reporters SHEN HONGLEI & WU XINYI

Editor: The Beijing-based Economic Daily recently carried the headline, "China Takes Three Steps As the World Takes One" -- an observation on China's economic growth. Its 16 percent annual GDP growth means that Pudong is advancing at double that speed. This phenomenal growth rate makes Pudong the central focus of this issue.

SHANGHAI is on China's east coast, facing the Pacific Ocean. Within its jurisdiction are 19 districts and one county.

    Prior to the arrival of Western imperialists, Shanghai was already a prosperous coastal city. In 1843 it was forced open by foreign powers, who brought to it modern trade and finance which they applied throughout their 10 km-long concession district. The 34 bank buildings along the Bund are monuments to the financial history of Shanghai, and to its prominence as commercial and financial center of the Far East.

During the last century Shanghai has maintained its status as China's financial powerhouse, and acted as its economic barometer. On April 18, 1990 the Chinese government declared its intention to develop and open Pudong, thus making Shanghai the national strategic leader of the Yangtze River Delta, as well as China's economic, financial and trade center. This decision brought Shanghai to the forefront of China's reform and opening-up and allowed it, by virtue of Pudong, to spread its wings.

The Wings of Shanghai   

At an investment of US $1.521 billion, GM Shanghai is currently the largest Sino-US joint venture.

The fruits of the European and American Industrial Revolution began to be introduced into Shanghai in the 1820s-30s, and later on shipbuilding and the filature industry were established here. Shanghai played a leading role in China's transition from medieval to modern industry, establishing itself as a port city of international significance. After the founding of New China, Shanghai continued to be an important industrial city and made significant contributions to the national economy in terms of finance, capital and technology. For many years it generated one-seventh of the national revenue.

    In the 1980s four southern coastal cities were made experimental sites for China's reform and opening-up. In the process, Shenzhen emerged as the most economically active city in China.

    Ten years later, as Shenzhen exceeded all expectations in its reform and opening-up, Shanghai experienced its most challenging period. Its industrial equipment was either in poor condition or obsolete, and its housing conditions overcrowded. The Shanghai people wanted development, but their old city lacked the necessary operational space for this to occur.

    Shanghai attempted a northward expansion beyond the Baoshan District by building two iron works there. This area is, however, also very limited, being just a few steps away from the Yangtze River. The area beyond western Shanghai is in Jiangsu and Zhejiang provinces. Although economically developed, it was too far away from the sea for Shanghai’s purposes. The third alternative for development was to cross the Huangpu River to Pudong.   

Situated on the eastern bank of the Huangpu River, Pudong covers an area of 556 square kilometers -- one-twelfth that of Shanghai. In the past, Pudong generally referred to the area east of the Huangpu River, the old city west of the river being known as Puxi. Neither was marked on the map. The 114-km-long Huangpu is the mother river of Shanghai. It flows from the southwest into the city, traverses the city proper, and joins the Yangtze River at Wusongkou in eastern Shanghai.

    The opposite banks of the Huangpu were previously unconnected by bridges or tunnels, so although Pudong was just across the river from the prosperous Bund and Nanjing Road, it remained economically underdeveloped. There were, however, wharves, factory facilities and storehouses along its shore. In the 1990s Pudong developed over 1,000 industrial enterprises with an industrial output value of nearly 20 billion yuan, but it was still dominated by agriculture.

    The central government's decision to develop Pudong has expanded the New District to seven times the size of the old city Puxi. It now covers almost the entire area east of the Huangpu River. One foreign investor commented, "Shanghai is solidly based, and in addition it has the blessed virgin land of Pudong. It is rare for a big city to have such a large area of exploitable land. This will undoubtedly make it attractive to investors."

* The first year of Pudong's development was defined as Shanghai's "Year of Finance." Today the city has more than 3,300 domestic and foreign financial institutions, and 80 percent of the world's top 50 banks have branches in Shanghai.

* Pudong houses the Jinmao Tower, tallest in Asia, and the Oriental Pearl TV Tower, tallest in China, as well as the Lujiazui Financial and Trade Development Zone, Jinqiao Export Processing Zone, Waigaoqiao Free Trade Zone, and Zhangjiang Hi-tech Park.

* Since 2000, Shanghai's tertiary industry has earned more than half of the municipality's GDP. This indicates that Shanghai is one step closer to its goal of becoming an economic, financial and trade center. Pudong has become a major link in the world economy.

* The 2001 APEC meeting was held in Pudong, making it to the focus of world attention. So far state leaders from over 200 countries have visited Pudong.

* In 2002 Shanghai won its bid to host the World Expo 2010, thus indelibly imprinting Shanghai's Pudong on the international consciousness.

Today the banks of the Huangpu River are connected by three bridges and two tunnels, and are accessible via subway and light-railways, elevated ring roads, and maglev trains. Pudong is also on the latest world map published by the US Atlas Press. An American journalist once asked a Pudong official whether the Pudong development project was intended as a facelift for the aging Shanghai. His answer was, "Shanghai is not old, and Pudong's development will make it even younger." The development of Pudong has brought new vitality to Shanghai, 150 years after it first opened its port.

Pivot of the Yangtze River Delta   

Pudong International Airport.

The Yangtze River Delta is the cradle of China's national industry and an area of abundance. According to Li Tingyao, director of the Regional Economy Research Office of the Pudong Comprehensive Economy Research Institute, the Yangtze River Delta is actually an economic/geographic area far greater than may be inferred from its name. It includes Shanghai, southern Jiangsu Province, and the greater part of Zhejiang Province, totaling some 100,000 square kilometers that encompass 15 cities, and nearly 100 million residents. Shanghai is the largest city, as regards both territory and population. The next largest is Nanjing, provincial capital of Jiangsu.

    The Yangtze River Delta has always been a prosperous area, and cities in the area have close economic links. Wuxi City in Jiangsu is known as the lesser Shanghai.  Quite a number of powerful national capitalists started their businesses there and went on to prosper in Shanghai. In the mid-1980s, large state-owned enterprises in Shanghai faltered under the yoke of the planned economy, and many of their technical personnel went to rural enterprises in Jiangsu and Zhejiang to act as "Sunday engineers." As its central city, Shanghai's economic well-being has always had direct influence on that of the delta area, but the development of Pudong has made the entire Yangtze River Delta the most open and economically active area in China. A group of economically prominent cities has emerged, including five whose annual GDP approaches 500 billion yuan. The Yangtze River Delta is now acknowledged as the world's sixth largest city group.   

A marathon organized by the Jinqiao New District.

Over the past 10 years, economic links in the area have become even more close-knit. Today Pudong has over 6,000 domestic enterprises with a total registered capital of 30 billion yuan, more than 30 percent of which are in Jiangsu and Zhejiang. GM Shanghai's vendor network has been extended to Jiangsu's Kunshan and Jiangyin. The development of Pudong and rejuvenation of Shanghai will undoubtedly propel the Yangtze River Delta economic takeoff to new heights, and bring great benefits to its two neighboring provinces.

    The actual utilization of direct foreign investment in the Yangtze River Delta currently accounts for nearly a quarter of the national total. Despite covering only 1.04 percent of China's territory, and its inhabitants representing just 5.9 percent of the whole population, the area's GDP constitutes 18 percent of the national total.

Pudong Height and Shenzhen Speed

    Shenzhen and Pudong play the two leading roles on China's economic stage. The former pioneered China's reform and opening-up in the early 1980s, and the latter symbolized its extension and China's coming of age in the 1990s.

    "The development of Pudong is 10 years overdue," says Zhou Yupeng, vice mayor of Shanghai and secretary of the Pudong New District Committee of the CPC. "But it is taking place in tandem with China's overall transition from a planned to a market economy. It can be said that Pudong stands on the shoulders of Shenzhen, and that it is continuing the development first instituted by the SEZ." In the square in front of the Shenzhen Museum stands a statue of a giant pushing against an iron doorframe with all his might. It symbolizes Shenzhen's efforts to break away from the bondage of the old system and open the road to China's reform and opening-up.   

An American and European cultural performance staged in Pudong's Century Park.

Zhou Yupeng says that Pudong's initial advantage, gained by its "leg-up" from the pioneer Shenzhen, merits its being entrusted with a still greater mission. Despite sometimes locking horns with the old system, Pudong's objective is to bring China in line with international practice, create for it a modern market economy system, and pave the way to China's entry into the world economy.

    Both Shenzhen speed and Pudong height mark the extent of China's reform and opening-up. Shenzhen demonstrates to the world its enormous hi-tech prospects, as Pudong and Puxi augment Shanghai's advance towards being an international financial center. The 34 original bank buildings along the Bund are historic landmarks, but across the river Pudong is illuminated at night by neon lights on the towers of 55 world-class banks in the Lujiazui Financial and Trade Zone.

    If old Shanghai's status as financial center of the Far East was the result of capitalist-imperialism, the 100 or so domestic and foreign financial buildings in Pudong's Lujiazui irrefutably demonstrate how new China is assuredly joining the world's mainstream. A fresh round of infrastructure construction in Pudong, including an airport, a deep-water port and an information port, is turning the New District into an increasingly important hub within the global economy.

    Visitors to Shenzhen feel keenly the youth and vitality of this young city, whose population has an average age of less than 30. In Pudong, they cannot but be impressed by the local propensity for attention to detail and perfectionism. No matter how influenced they may be by tales of the excessively shrewd Shanghainese, when they compare Shanghai with other Chinese cities, its industrial and commercial superiority, distinguished by clearly delineated responsibility and cooperation, is undeniably admirable.