Expo may turn profit in future
Shanghai officials believe next year's World Expo could eventually turn a profit - even though it may end up costing more than the Olympics.
Party secretary Yu Zhengsheng said on television this weekend that the city's target 'is to break even', but future profits were possible as the expo site would be redeveloped after the event.
'The expo site is in the city centre, so it has high value in the future,' Mr Yu said. 'And if we make a profit, we will build more houses for low- income families.'
Media reports have quoted expo officials as putting the total cost of the event as high as US$45 billion, which is more than the US$40 billion to US$43 billion spent on last year's Beijing Games.
But official figures from expo organisers put the cost of the event, which will last from May 1 to October 31 next year, at 28.6 billion yuan (HK$32.5 billion), or US$4.2 billion. This will include 18 billion yuan on infrastructure within the expo site and 10.6 billion yuan on event operations.
Mr Yu said the investment, including an additional US$100 million fund for developing nations to take part, would come from city coffers.
Organisers said funds would be raised through expo construction bonds, ticket sales and sponsorship. They anticipate ticket sales will generate 6 billion yuan - provided the event attracts the hoped-for 70 million tourists.
However, the official expo budget does not include large-scale infrastructure projects such as transport and power-grid upgrades.
This follows a similar pattern to last year's Olympic budgeting process. Organisers claimed the sports event turned a profit of 1 billion yuan - but that did not factor in the construction of venues.
More than 200 billion yuan will be invested in the transportation system, with the subway network being doubled in length in time for April.
Shanghai's main power supplier yesterday said it would invest 26 billion yuan to upgrade the city's electricity network, including high-efficiency substations and underground cables, to ensure a stable power supply to the expo site and residents.
Mr Yu said the cost was worthwhile, as traffic congestion had long been a headache.
'Since a lot of people will visit Shanghai, our tourism industry will thrive and tourism-related stocks will appreciate,' Mr Yu said.