Op-Ed Commentary: Chris Devonshire-Ellis
Twenty years ago, as weird as it may seem today, no one wanted to be posted to China. The country, still fresh from the Tiananmen incident, was something of an international pariah, and trade was only just beginning to pick up. No one was sure which direction China would take – retreat back into a closed shell, or reform and develop. While the answer now is obvious in terms of what happened, back in 1992 much of China was still waiting to be discovered, and expats were rather thin on the ground.
Someone visiting Wuxi, for example, would be greeted as a seasoned traveler upon their return home and as someone who would take risks and seek adventure. Twenty years ago, nearly all of China was like that – mysterious, romantic, and full of the allure of the ancient orient. Today, China is full of expats and businessmen, and many have traveled around with the mantra: been there, done that. Yet growth today is not necessarily in the obvious cities. With two airports, a maglev, and miles of highways, bridges, buildings, and port facilities, Shanghai as a contemporary city is built out. All that remains in terms of business opportunities there are the service industries – selling to the city’s inhabitants. Even manufacturing is long gone, pushed out to less romantic, yet far more cost-effective destinations such as Ningbo, Hefei and Yiwu.
It’s the same story in other primary locations too. Beijing is slightly different due to its status as a national political capital, but cities such as Guangzhou, Shenzhen and even Wuhan and Chengdu are being finished off, nothing left to develop now except a sales market. Not that that’s a bad thing – Chinese consumerism is expected to turn sharply up, especially in the third and fourth-tier cities where the newly established middle class want to acquire Nike shoes, LV bags, iPhones, and drink coffee at Starbucks.
But the true prize, in my opinion is even larger: Central Asia. I’ve just returned from two weeks travelling across Mongolia, Inner Mongolia and Xinjiang, assessing just how far these regions have come and how they are poised to develop. Mongolia as a country has just been rated one of the top investment destinations for the next 10 years by Global Finance Magazine, and of course we have already set our stall out there concerning monitoring the country through our Mongolia Briefing facility. As concerns more general investment potential though, the country is limited to expertise in mining, and remains currently a big-ticket destination for investment dollars. Central Asia is a different matter. Comprising a huge area, the region is not officially defined, yet certainly includes Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan and Turkmenistan. Add to these a looser definition of Central Asia and you include Afghanistan, Pakistan, Mongolia, Tibet and Xinjiang Province. There would be some mileage in stretching the region to include Iran as well, in addition to parts of Russia’s Siberia. But the principal financial, communications and logistics hub servicing all of that? Urumqi.
Xinjiang also offers the romance that I loved about China 20 years ago
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