China’s shrinking cities are still addicted to building despite population slump
- Dozens of Chinese cities are spending big on construction projects, despite having shrinking populations
- 90 officially-designated cities have shrinking populations and 71 of those have expanded their urban areas
Dozens of cities in China are spending big on construction projects, despite having shrinking populations, a South China Morning Post analysis has found.
On paper, these debt-fuelled projects are major contributors to economic growth, but in reality, they do not bring real productivity, raising further questions about the efficiency and foresight of China’s urban planning.
New urban constructions should, in theory, go hand in hand with population growth, but in many shrinking cities, local governments are still building, even though they need to accommodate fewer people.
The Post analysed official population statistics for the 661 officially-designated cities in China between 2010 and 2017. After discounting those that had either been absorbed into other urban sprawls or did not exist in 2010, 627 remained.
Of these, the population declined in 90, or 14 per cent of all Chinese cities. Over the same period, 71 of those shrinking cities had expanded their urban area.
Nationwide, the total urban population, including temporary workers, grew by 20 per cent between 2010 and 2017. The area of built-up urban area, measured in square kilometres, soared by 40 per cent over the same period, according to official yearbooks of urban construction produced by the Ministry of Housing and Urban-Rural Development.
“It is hard to expect local governments to set their goals in line with population shrinkage in the current economic system, under which governments still need to fight for resources to boost investment and growth,” said Xu Jianwei, senior China economist at Natixis, who suggested that a shrinking city may not be the end of the world.