Nestled between the third and fourth ring roads in the unfashionable west of Beijing, the Golden Resources Shopping Mall is part monument and part reality check to the growing emergence of China as an economic superpower. At about a thousand vendors and half a million square metres, ‘The Great Mall of China’ was the largest mall in the world until China built an even bigger one further south in Guangzhou. Yet even by the incessant scale of Beijing, Golden Resources seems plenty big enough.
You wouldn’t call it suburban—Beijing is an eternal and seemingly endless city—but out here is a long way from where most Westerners go. It’s a different world to the Singaporesque new centre of Chaoyang where most expats reside; the charmingly rebuilt hutongs in the city centre that are a magnet for expat hipsters; the once-gleaming, now dust-drenched Olympic venues; the knowing irony of the 798 contemporary art district; or the ancient palaces and modern monuments to Mao around the Forbidden City where large numbers of local and international tourists flock.
Out here even the nearest underground station is a few kilometres away. If you walk here through the miasma of the Beijing summer, the air leaves a gentle tingling (or is it burning?) sensation with each breath. As the massive building emerges from the smog it evokes a mass of references, such as the steroid-fed bastard child of Melbourne’s Chadstone, the Big Pineapple and the design aesthetic of the 1984 Los Angeles Olympics. I had seen it described as art deco, but if that’s occasionally evident in the details it’s lost beneath layers of kitsch, dust and aggressive consumerism. It’s only seven years old but nothing new ages well here. Beijing is at its best with the recent and the ancient. From inside you can’t tell whether the opaque corrugated fibreglass roof is intentionally frosted or was once transparent before the constant sandblasting by the dust storms.In a country of monumental communo-capitalist mega projects, Golden Resources has become conspicuous—in the West at least—as an early and particularly epic failure. Wikipedia suggests as few as twenty to thirty people per hour actually visit here. On this particular Tuesday it seems slightly more active than that but it is easy to imagine that many of the stores could go through a full day without paying customers. The cleaners, the shop assistants, the information desk attendants, the three staff watching over a children’s play area with no children playing in it, or the hosts of the game show with elaborate staging and dozen participants but almost no audience easily outnumber the shoppers.
Inside it is bewildering and overwhelming. It is large and at once strangely familiar and uniquely Chinese. ‘The Girl from Ipanema’ plays on the muzak. The constant assault of pseudo Western brands and generic international retail design makes it impossible to distinguish between the Chinese labels, the knock offs and the real ones. Do Jeep sell children’s clothes back home? Trendiano? TR/BECA? Plory? Are these real brand names or has someone just gone crazy with a map and a faulty version of Google Translate? Louis Tocool? I-baby? Everywhere cartoon characters sell unrelated products. There is a Snoopy shop here, while Garfield has a clothes store and a bakery. Disney logos are slapped on an impossible range of goods and services from furniture to English lessons. In a country notorious for rampant piracy it’s hard to tell whether it’s a brand consultant’s horizontal integration fantasy or an IP lawyer’s nightmare. In the West, shopping centre placement is a carefully considered pseudo-science of demographics, transportation and assessment of competition. By contrast, the rationale behind building this mall here is difficult to discern—it seems too big and in the wrong spot. Yet somehow, despite early predictions of its imminent demise, Golden Resources has remained open for the best part of a decade. It is mostly tenanted. At first it’s difficult to understand how.
Wikipedia suggests that several of the foreign brands are subsidising their presence here as a loss leader to break into the Chinese market. Perhaps once that was true, but it seems unlikely now given the abundance of faux Western brands and the many genuine new flagship offerings and designer stores appearing downtown. Is it simply that the costs of labour and materials are so low that the overheads are affordable here? Is it hubris that won’t let the world’s biggest mall fail? Is it a capitalist creation or a folly of the state? Is Golden Resources a socialised loss in a sea of private profit, or is it a capitalist liability? As country after country is forced to confront bad loans and poor risk assessment, we might well ask: who’s left holding the mortgage to an underutilised, oversized shopping complex? After three months in China, my lingering fear is that the whole Chinese miracle looks better on paper than it does in the Beijing summer dust.
Australia has so much invested in China. Not merely financially but psychologically we have placed an all-in bet on it. China surges ahead just as our traditional partners are stumbling and falling over. As the ‘Middle Kingdom’ grows and as the United Kingdom and the United States recede, we find ourselves precariously balancing old alliances and a new partner that is culturally and politically very different from us. Our national resilience and prosperity are bound tightly to the growth and success of China, yet few would genuinely claim to understand it. China has crept up on us. Not long ago it barely registered as a trading partner, but now we have become so closely linked that the Australian dollar rises and falls as a proxy for the fixed-rate Chinese yuan. Australian companies are striving to be part of an Asian, and predominantly Chinese, growth story. Our exports to China have thus far insulated us from the mass unemployment and the housing busts that have afflicted so many of the nations we once regarded as our peers. China’s demand for our resources underwrites everything from our fiscal health and retirement savings to the billionaire who bought the football team I follow. China is the new sheep’s back on which Australia’s prosperity rides. It is the luckiest card the lucky country has drawn yet.
We think we understand the United Kingdom and the United States. The minutiae of their politics, their economic woes, their national obsessions, triumphs and tragedies are to some extent comprehensible to even the vaguely engaged. By contrast, China is opaque and notoriously difficult for even those who follow it professionally. For my part, spending time there seemed to amplify, not resolve, the uncertainty. From afar China becomes a series of myths and stereotypes: communist demon, capitalist miracle, a land of opportunity, and most compellingly a once-great nation returning to its rightful place and becoming great again. China’s many myths have underlying truths to them.
Yet up close it feels far more complex. China’s miracle is in equal parts brilliant and broken, prosperous and perilous, enlightened and endangered—in part due to forces beyond its considerable control and in part due to that control. China’s challenges are to a degree those of the West: an export-led miracle may flounder in a world that is reducing imports. The global chain that starts in the Pilbara and passes through the factories of eastern China ends in the bargain bins of American Walmarts. What happens when economies stumble from crisis to crisis and slow their once-reliable consumption?There are also considerable challenges in China. It balances precariously on its own contradictions: it is communist but capitalist, it is transforming but not transparent, and it is cheap but not efficient (sometimes a job that could be done by a single person is shared by four or five). It is at once a rich and a third-world country. It is a land of extravagance and staggering poverty. It is undemocratic and yet its leaders must constantly attempt to demonstrate their legitimacy and to validate the system in ways few elected governments are obliged to do. In China the mood is a strange mix of worldly and naive. There is weariness in the ways of the world after generations of turmoil and revolution, but there is also enthusiasm for the promise of global capital in a way that seems out of sync with recent experience in the West. It seems to be following a trajectory to prosperity pioneered by its neighbours while remaining oblivious to the pitfalls many of those neighbours have encountered. Almost all the Asian tigers have seen political upheaval and economic turmoil, while Japan enters yet another sluggish decade as it attempts to deal with the aftermath of massive debt, natural disasters and the challenge of an ageing population. Yet China, faced in the medium term with the demographic legacy of its one-child policy, now seems to expect decades of high and predictable growth. The expectation is that the state and the market will drive the boom while the party will protect the economy from the inevitable busts.
Jinan, the capital of Shandong province, is one of countless Chinese cities bigger than Sydney or Melbourne. Most Australians would never have heard of it and few could locate it on a map. It is unremarkable in China but from a global perspective it is growing faster than almost any place on earth. From the beautiful mountains that surround it or from any of the rapidly emerging high-rises, Jinan’s old city literally disappears beneath you. It looks like a construction site. The inconveniently placed small-scale old neighbourhoods are making way for ubiquitous brands and gleaming buildings.
‘Progress’ is a word out of vogue in the West. Yet from the new freeway that intersects with the Beijing–Shanghai high-speed rail line outside Jinan the sense of ‘progress’ is overwhelming. Our prevarication over major infrastructure projects contrasts dramatically with the capacity of the Chinese to decide to do something and get it done. Superfast trains emerge from a tunnel in a distant mountain and seem to fly across a long viaduct before disappearing among forests and factories. The rail line is an act of willpower over landscape that seems to belong to another era. Jinan, by virtue of its position on the line, is now connected to China’s two political and economic capitals in a matter of hours.
Outside Jinan—and every Chinese city I visited—rice fields give way to residential development that seems to sprawl. Outside Tianjin are clusters where twenty- or thirty-storey buildings are being built in several locations. Few had any obvious transport links or the economic activity that usually drive such developments. Outside Jinan and Tianjin and even in our neighbourhood in Beijing, most apartments seem unoccupied, if not unfinished. It is as if they have been built as a store of wealth, in a country with a dysfunctional banking system, and left idle in the expectation of a boom to come. By some estimates there are more than 60 million empty apartments across China. It is the flipside of the political certainty that allows for rail that runs at record speeds to be constructed in record time. Under the current system, having the right connections makes it easy to decide what but often difficult to ask why.
The Australia–China relationship these days comes sprinkled with a generous layer of ‘mineral dust’. Everywhere private and public monies stirred up by the demand for our raw materials are liberally sprinkled across the connections. Australia’s interests are increasingly seen to be in promoting cultural and economic exchange, accelerating interconnection, financing and fuelling relationships. Like Australia’s relationship with many of our powerful friends it is almost certainly more vital to us if than to them. Along the way it is creating layer upon layer of opportunities and absurdities.
We are in Jinan by accident, as extras for an Australia–China exchange, a mineral dust exhibition. It is taking place somewhere we mistook for Jinan but is effectively a new city outside it. Our destination feels almost as far from Jinan as Jinan feels from Beijing. We have been randomly recruited at an exhibition in Beijing, offered a free train fare and now find ourselves being chauffeured in a gleaming new Audi to the opening. Despite the grandiose new art gallery and the considerable investment involved, random Westerners are being bribed to appear there. The big gallery cum university complex outside Jinan is one of dozens if not hundreds of such projects—museums, performing arts centres, large galleries that form a small part of new pseudo cities—under construction across regional China. Even in China none of this would come cheap. They are part of stimulus on an unprecedented scale to counter the global financial crisis. So far it has proved an effective policy at the national level as China has largely escaped the global malaise, but it has resulted in countless local projects whose rationale it is difficult to comprehend. Even where the logic, such as that of a new university campus, is obvious, scale has the ability to triumph over purpose.
On arrival at the Jinan Yuan Bo Yuan International Exhibition Centre we play the role of honoured guests. A small army of organisers, assistants and uniformed observers ensure we are escorted at the right moment with fanfare across red carpet and ushered into one of two VIP rooms out of Communist Party central casting—full of oversized couches covered in doilies. Chain-smoking local party officials are re-enacting the sort of welcome that Deng Xiaoping would have prepared for Mikhail Gorbachev. On cue we are ushered onto an elaborate stage. Around us are people who may or may not be the artists, the organisers and a representative of the Australian embassy. The speeches, roughly translated into English, are a mix of corporate doublespeak and contemporary Communist Party propaganda. Officials laud the ‘science creative industries cultural precinct master plan’ to an audience who appear to be mostly students and for whom, one suspects, it was compulsory to be here.
Despite my gentle enquires, the rationale for building in the middle of nowhere a contemporary art gallery that would dwarf the national galleries of most countries is never explained. The impressive grandeur of the occasion only reinforces the feeling that this is an ivory elephant. The exhibition features quality Australian and Chinese media (mostly video) artists whose works are ill suited to the context. Intimate confessions and observations are blown up onto projections the size of tennis courts—as if to reinforce the sense that the whole project is unnecessarily big. As we take in the exhibition it becomes clear that we have lingered too long. Several of us—mostly the extras—have missed a crucial bus connection. Our official party has been split in two, and the illusion of control and clockwork logistics is shattered. Despite the efforts of the small army of people managing the event it is apparent that everyone knows what was supposed to happen but now no-one knows what to do. It feels like a parable of central control: the more we insist that our plans have gone awry, the more the various helpers, officials and hangers-on insist that they can’t have.
If there’s a word that makes sense of China for me it’s exponential. China is growing at an exponential pace—at an average of about 10 per cent a year for the last three decades. Many of the roads, apartments, railways, shopping centres, art galleries and museums, new cities and ‘science creative industries cultural precincts’ are being built not because they are needed now but in the expectation that before long there will be demand for them. Increasingly the growth is being driven by the fact that China expects to grow exponentially.
China’s decades of pent-up demand—held back by years of communism—have catapulted the country into the biggest export boom in history. The focus on growth has driven a surge in living standards and prosperity. But there are risks. Provided you put your money into something that would compound in value, you could become gloriously rich. Many provinces, ambitious entrepreneurs, party officials, careful savers and canny investors were smart, and many more were lucky.For every successful project of the last few decades it seems there are now dozens seeking to emulate them. It is a system based more on anticipation than on demand: of millions of new residents in unlikely locations, of growing markets, of booms that last forever. An exponential boom is needed just to keep pace with expectations. The whole system seems precariously balanced somewhere between a genuine economic miracle and a Ponzi scheme.
As the global econony contracts, will forward momentum, the sheer willpower and resources it possesses see China safely through the difficult period? Or will the spell be broken and the thousands of questionable decisions and investments bring the whole thing to a shuddering halt?
Since the mid 1990s China’s official policy has been zhuadafangxiao—the state ‘grasping the big and letting go of the small’. It describes the role the state plays in the economy but it hints at the collision of big and small scales that plays out across China. It helps explain why the massive shopping centres are replacing the markets, why often empty towers are replacing the small-scale urban form, why superfast rail lines can criss-cross the country and why provincial officials can will entire new cities into being where rice paddies once stood.
The scale of the country, the population, the centrality of hierarchies, the reach of the authorities, the power to move mountains or entire cities, the national desire to reclaim greatness and the ability to deploy resources to meet those ends all converge in an experiment unique in scale in history. The scale brings enormous temptations too. As China finds itself awash with the kind of capital that can and has run like a wrecking ball through societies with a well-developed rule of law, its Communist-era processes seem ill-equipped to deal with it. There are few checks and balances here. The developers, the financiers, the decision-makers, the party, the army and the police are inextricably linked. Where power is concentrated and the resources deployed are vast, so the risks of getting it wrong are high. At some point mistakes will have consequences that may lead to the kind of social unrest China is desperate to avoid. Coming from a country with a population the size of a large Chinese city, it is easy to misunderstand China. My natural sense of scale doesn’t work here and at times almost everything looks out of proportion. Away from the megaprojects, China is a country of entrepreneurial, resilient local endeavour. From the fruit traders who set up stalls in the laneways to ambitious entrepreneurs with bedroom businesses, it is hard to imagine that the long-term future isn’t strong. It is difficult to tell in practical terms whether zhuadafangxiao means the state has cut such people free or simply cut them loose.
The grand-scale narrative about China is so convincing that perhaps the details are trivial. It may simply be that given China’s population and the pace of its growth there will inevitably be dud projects and misspent resources—they just look bigger here because everything is bigger here. But as around the world once-miracle economies have fallen into recession, the lingering fear is that China may be no better. For the sake of Australia’s golden run, we can only hope China’s case is different.
© Marcus Westbury