Chongqing’s special license to grow


Chongqing, Finnair’s new Asian destination as of spring 2012, is full of surprises. Perhaps the biggest is the limited extent to which this Chinese powerhouse is known in the West. Yet the rates of economic development and urban expansion taking place here are probably unequalled anywhere in the world.

Formerly a part of Sichuan Province, Chongqing was admitted to the select Municipality club – other members are Beijing, Shanghai and Beijing’s neighbour Tianjin – in 1997. Administered as such by the central government of China, Chongqing has a special license to grow.

With a population approaching 30 million at the beginning of 2011, the municipality centres on the confluence of the Yangtze and Jialing rivers, making it a strategically important regional transport and communications hub in central and western China. The actual city of Chongqing, as opposed to the mountainous region that completes the Municipality area, is home to some 8 million residents and is a thriving river port, located just upstream from the spectacular Three Gorges.

“It’s very good that Finnair will start flying here,” says Hans Halskov, (pictured) Trade Commissioner & Consul at the Royal Danish Consulate in Chongqing. “I am surprised that no other European airlines have come here yet. Finnair will get the benefits of being the first, including media exposure. It’s a big deal for Chongqing to attract an international airline too.”

Vast potential

The potential for Finnair Cargo in such a flourishing industrial environment is huge. “Chongqing currently attracts USD 10 billion in FDIs (Foreign Direct Investments) annually,” says Halskov. “That's a growth from USD 6.3 billion in 2010, from USD 4 billion in 2009, and USD 2.7 billion before that. Foreign companies want to invest more and there are already 200 Fortune magazine Global 500 companies present.

“Chongqing is booming because of its municipality status,” Halskov continues. “The policy has been extended for another ten years, so the phenomenal growth will continue for at least a decade. At that point it will have transformed into a city comparable to Shanghai or Beijing. Because of its inland location, Chongqing will never be like them in terms of internationalization, and that will remain a key difference. But in terms of GDP per capita it will resemble them.

“But Chongqing’s foreign trade share is rising and is expected to reach 50 per cent eventually,” says Halskov. “Last year's foreign trade figure was USD 12 billion and this year (2011) they are shooting for 30 billion. By 2015 they want to achieve USD 100 billion. They are putting everything in place to achieve that figure, building warehouses, ports, railways and highways.

“A new international terminal is being built at the airport. A new local terminal was built last year increasing annual passenger capacity from 18 million to 25. A new runway is being built which will be compatible for Airbus A380s. It will be the third largest airport in China by 2020.”

Laptop central

Chongqing also benefits from its proximity to Sichuan’s provincial capital of Chengdu, a few hours’ drive to the north-west. “There is a lot of synergy between the cities,” says Halskov. “Hewlett Packard decided to set up here and were followed by Asus and Acer, making this area the world’s biggest producer of laptops almost overnight. iPads, Lenovo and Dell computers are made here. Chongqing is also the world’s biggest producer of motorbikes and makes 1.5 million cars a year. The chemical industry is also very big.

“The financial services division is surprisingly big, with 7 per cent of GDP. Chongqing’s Mayor, Huang Qifan, is an economist and he believes that if financial services and property markets are thriving, everything else will be OK.”

Another significant aspect, not least for Finnair Cargo, is the Government’s green light for a Two River Development Zone to the north of the city. “GDP here will grow by as much as 20−25 per cent a year,” says Halskov. “Companies locating in this zone will receive certain advantages.”

Text and photos by Tim Bird


Published December 13, 2011

Category: Local features