Yangtze Briefing

Shanghai has high hopes for its glittering new exhibition space - but will they be disappointed?

With Shanghai set to open another exhibition centre, there's a feeling it's missing the point

PUBLISHED : Saturday, 05 July, 2014, 4:02am
UPDATED : Saturday, 05 July, 2014, 6:10am

Shanghai officials are confident the glitzy new exhibition hall currently taking shape will cement the city's status as the mainland's commercial hub - and prove Shanghai's determination to become one of the world's leading cities.

But concerns of a possible oversupply of exhibition space have stoked fears that the stunning new complex will become a white elephant.

Some critics also doubt whether a single complex can help overcome wider obstacles - such as a cumbersome tax system and questions over the rule of law and business culture.

The National Exhibition and Conference Centre, with it is 500,000 square metres of exhibition space, will give Shanghai yet another first. When it opens in October it will be the world's largest commercial complex for trade shows and business meetings. It's a new source of pride for officials who are convinced huge infrastructure projects will help rebrand the city.

Shanghai regards the exhibition hall, located in the Hongqiao district, as a symbol of its rise as an international trading centre - the latest title the city is chasing, after transforming itself into a financial and shipping hub.

The final bill for the expo centre is expected to be 23 billion yuan (HK$29 billion), 30 per cent less than the Shanghai Disney amusement park slated to open next year.

Indeed, the project carries significant political overtones for city leaders who have pledged to make Shanghai an international trading hub.

The city, recognised as a gateway to modern China, received the go-ahead from Beijing to develop itself into a global financial and shipping centre in 2009. The mainland leadership was trying to attract foreign capital and talent amid the global financial crisis.

Yu Zhengsheng , then Communist Party boss of Shanghai, said in 2009 that the city also aimed to become an international trading centre. But he told a government conference that to develop its financial centre, the city would have to convince policymakers in Beijing to fast-track liberalisation of the securities and monetary markets to attract capital inflow, which Shanghai made a priority in becoming a leading financial centre.

In 2011, Shanghai unveiled the centrepiece of its ambition to become an international hub of commerce, with a world-class exhibition hall to be built with central government support.

City officials believed the complex would be a magnet for businesses from around the world, which would flock to glittering trade fairs. But spacious exhibition areas don't necessarily lead to more trade shows and exhibitors.

Shanghai has travelled this road before. The 30km maglev rail line, linking Pudong airport and Longyang Road, was the first of its kind in the world when it opened in 2002.

But it has been eclipsed by the expanded metro system, with more passengers choosing the subway, where trips cost just a fifth of those by maglev.

Now, with the new national exhibition centre starting to bid for business, salesmen have admitted in private it was proving a tough job. The city already has 300,000 square metres of expo space at the New International Expo Centre.

Hopes the complex may energise the wider economy may also be wide of the mark.

A flourishing marketplace is based on the rule of law, enforced intellectual property rights and a straightforward and reasonable taxation system, not just sleek exhibition space.