Shanghai's Disney 'must avoid pitfalls of HK park'

PUBLISHED : Tuesday, 18 January, 2011, 12:00am
UPDATED : Tuesday, 18 January, 2011, 12:00am

Shanghai must ensure its long-awaited Disney theme park avoids the 'Hong Kong model' and guarantee that the city gains a larger share of the park's income, a delegate to the municipality's top political advisory body has argued.

In a proposal to the Shanghai People's Political Consultative Conference, which is meeting this week, Tu Haiming said the park - scheduled to be completed by 2015 - should take into account local culture and the needs of the local market.

'It certainly must not be purely American culture,' Tu told the Xinmin Evening News.

Tu said the Hong Kong Disneyland agreement was 'unfair' and favoured the US-based entertainment giant's interests over the government. Despite having footed the bill for 90 per cent of the park's investment, the Hong Kong government had gained little, he said.

'[This] is the biggest lesson Shanghai should learn from Hong Kong, which hardly makes any profit from the Disneyland project so far,' he told the Shanghai Daily.

Tu said he understood that the Hong Kong government was entitled to only a share of ticket sales, and argued that Shanghai should fight for a cut of the park's overall revenue, including merchandising and income from Disney hotels.

Hong Kong Disneyland has been plagued with troubles since it opened in 2005. It reported a loss of HK$4.4 billion from 2007 to 2009.

The company's results for last year are due to be announced today, and the park is expected to record one of its best years, with higher attendance and better profitability, buoyed by an upsurge in mainland and overseas visitors and their increased spending.

The Shanghai Disney theme park was finally given the green light by the State Council in November 2009 after more than a decade of negotiations.

However, it is already dogged with controversy.

Insiders have hinted that negotiations between the US-based entertainment giant and its local partner have not run entirely smoothly.

A formal agreement with Shanghai Shendi Group was not signed until November, a full year after the announcement and eight months later than Disney management had initially predicted.

Final plans are now awaiting State Council approval.

The site of the park, close to Pudong International Airport to the southeast of the city, has been cleared.

Local media recently reported that the main access roads to the park were due to be completed in April and main construction work would start in May.

The Shanghai government was also forced to issue a statement earlier this month saying that the total investment for the project was still under review, following media speculation that the first stage of the park would cost 25 billion yuan (HK$29.5 billion) to construct.

Big bucks

There has been speculation the first stage of the Shanghai park will cost this much, in yuan: 25b yuan