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Is Lianyungang a sleeping giant?

With Shanghai feeling the pain of the financial crisis and a plunge in exports, the east coast has been searching for a miracle cure.

Step forward, Lianyungang . The low-profile, underdeveloped city on the northern coast of Jiangsu province has been tapped as one of the new shipping centres that will help the region once again fire on all financial cylinders.

Lianyungang's officials could hardly believe their luck at receiving lucrative central government endorsement - arguably the city's biggest boost since the Qing dynasty (1644-1911), when it was one of the four ports opened to foreign trade in 1860.

The other cities opened then - Guangzhou, Ningbo and Xiamen - have all developed into major urban centres.

At a recent investment promotion event in Shanghai, Lianyungang cadres sketched out their vision to join them.

Party boss Wang Jianhua said the port's handling capacity would be nearly tripled - to 10 million twenty-foot equivalent units (teus) - to meet requirements that it serve as a springboard to greater development for inland areas.

The city would attract mega-sized petrochemical projects that would create thousands of jobs for migrant workers, Mr Wang said.

Grander still is the central government's blueprint envisioning Lianyungang as the starting point for the so-called New Eurasia Continental Landbridge, a shipping route that connects with Russia through the Trans-Siberian Railway.

A few noses have been bent out of joint by this seeming largesse, not least Shanghai's. Less than six months ago, the metropolis' plan to transform itself into a global financial and shipping centre was endorsed by the State Council. It didn't take long for the city to realise the word 'centre' was as much geographical and administrative as it was economic.

The top leadership designated a further three cities, including Lianyungang, as regional centres. The other two were Nantong, a port on the lower reaches of the Yangtze, and Yancheng, an agricultural centre in Jiangsu.

Beijing's motivation appears to be balanced growth in the region, with Shanghai in the 'big brother' role. Amid the rapidly expanding port capacity - Shanghai's new deep-water port at Yangshan will eventually have a capacity of 15 million teus per year. Amid a decline in exports, the competition for containers is expected to be cutthroat.

Competition is nothing new to Lianyungang. In addition to the likes of the more advanced Nantong and Yangshan, it has been locked in a fight with Rizhao , a city two hours up the coast in Shandong province.

Fortunately, the fracas over Yangshan has given the Ministry of Communications, the nation's water transport regulator, all the experience it needs in settling inter-port squabbles.

The offshore port was proposed by Shanghai in the early 2000s in a bid to outshine rivals such as Kobe and Osaka, in Japan. But the plan drew the ire of Zhejiang cadres, who feared the facilities in Ningbo might go to waste as more new-generation ships headed to Shanghai instead.

The discord headed right to the top level of the government. While then president Jiang Zemin supported Yangshan, then premier Zhu Rongji was adamantly against it.

According to a senior official with the Ministry of Communications who was involved in the decision-making process, Mr Zhu contended that overcapacity would undermine the ports' long-term development and lead to fierce competition. While competition remains a concern, Beijing is betting that, with its help, the likes of Lianyungang can take a step ahead of rivals in Taiwan, South Korea and Japan.

With its sea ports and land bridges, Lianyungang could finally be ready to wake from its slumber.

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