Authorities in one of China’s poorest regions are hoping that a multibillion-yuan bet on a huge block of land by a Singaporean shipping company can be the catalyst for an ambitious trade project that has languished for a decade.
The goal is to turn the 3 sq km barren block in Nanning, the capital of the Guangxi Zhuang autonomous region, into a “world-class” logistics hub to forge stronger trade links between southwestern China and Southeast Asia.
It’s the same goal Guangxi was aiming for a decade ago under a national strategy called the “Development Plan for the Guangxi Beibu Gulf Economic Area”. But the region struggled to attract the required foreign investment and had little to offer in terms of exports, resulting in little progress.
Now, though, an initial 10 billion yuan (US$1.59 billion) investment from a Singaporean shipping company and rebranding are again fanning hopes that this time things might be different – even though some of the same obstacles remain.
Guangxi lies on the border with Vietnam and is within striking distance of the rest of Southeast Asia.
It is one of the poorest parts of the country in an impoverished provincial neighbourhood, with its economy reliant on oil refining, mining and food processing.
The region has struggled to thrive, despite many attempts to lift it up the national economic league table. Last year it was the fifth poorest of the country’s 31 provinces in terms of per capita GDP, according to China-based market analysis company ibaogao.
To help drive change, Guangxi’s government is branding the region as the “Chinese gateway” to Southeast Asia. And that’s where Pacific International Lines’ multibillion-yuan pledge comes in.
The Singaporean investment is the first major commitment by the city state since its government signed a memorandum with China to build the “Southern Transport Corridor” trade route.