“The gift from the sea”: through land reclamation, China keeps growing and growing

Yangshan Deep Water Port: not so long ago, this land didn't exist. Image: Wade Shepard.

China has undergone more than three decades of unprecedented rapid growth. Literally. The country is expanding.

Hundreds of square kilometres are added onto China each year, as coastlines are extended farther and farther out to sea. Massive amounts of land are being reclaimed to build new cities, ports, resorts, and industrial zones.

Dubbed by the domestic media as a “gift from the sea,” land reclamation has become an all out developmental free-for-all in China, with every coastal province having large-scale projects under way. 

“Land from the sea creates 'cheap' space for agriculture, industries, and urbanisation,” says Harry den Hartog, the author of Shanghai New Towns, who is currently researching land reclamation in China for the Netherlands’ Delft University. “For planners, this is a 'tabula rasa,' where you can build whatever you like on a white sheet of paper.”

Reclaiming land is nothing new in China. Since the Qing Dynasty (1644-1911), sediments have been trapped from rivers or from the coast to make more land for farming, salt production, and aquaculture. Hong Kong has been reclaiming land since the 1860s. The surface area of Macau has been increased 1,000 per cent with artificial land. In the current era, cities all across China are creating new land to develop for urbanisation initiatives – and the profits are huge.

Nanhui New City, Shanghai, stands on reclaimed land. Image: Wade Shepard.

According to Liu Hongbin, a professor at the Ocean University of China, reclaimed land can result in a ten to hundredfold profit. Last August, a plot of reclaimed land in Qianhai sold for $1.77bn, bringing the new special economic zone's total earnings through land sales up to $37.4bn. Another record breaking land sale in Hainan saw an artificially created parcel go for over $1.5m per m2. So, the economic impetus for land reclamation is clear: making land makes money.

In 2010, the coastal city of Longkou, in Shandong province, found its urbanisation ambitions stunted by the sea which hemmed it in. The local government whined for a while about how many millions of dollars in revenue was being lost each year because of the lack of new development land, but then devised an ambitious plan to remedy the situation: they would remove 440m m3 of soil and stone from a nearby mountain and dump it into the bay.


A few years and over $3bn later, seven new islands rise above the water’s surface, providing an additional 35.2km2 of urban construction land that could be sold off to developers at a premium rate. By 2020, some 200,000 people are expected to live on these new islands, which will by then sport arrays of new apartment complexes, resorts, offices, golf courses, and industrial parks. The local government hopes that the annual yield from this additional development will be in the ballpark of $50bn.

If you look at a satellite image of Shanghai you will notice an askance hook nose-like protrusion hanging off the tip of Pudong. That protrusion is artificial; it was land that was created for a 133km2 new city called Nanhui, which is touted to eventually become a “mini-Hong Kong.” Reclaiming enough land to build this city that was designed to house 800,000 people only took five or six years.

Large-scale “land manufacturing” projects are currently underway all the way up and down China’s 18,000km of coastline. A few examples:

  • Tianjin port, the largest in north China, was constructed on 107km2 of land that was reclaimed from Bohai Bay.
  • An expanse of land twice the size of Los Angeles has already been reclaimed by Tangshan to create the Caofeidian new economic zone. There are plans to add on an additional San Francisco-sized portion by 2020.
  • In Guangdong Province, Dongguan and Shantou are tacking on 44.6km2 and 24 km2 respectively, while the new Qianhai FTZ, in Shenzhen, is being built on 15 km2 of land taken from the sea.
  • Sanya created something dubbed the “Oriental Dubai” by building an artificial archipelago for luxury hotels and an international cruise ship port.
  • Taizhou is currently expanding by more than twice the size of Paris into the sea.
  • Yuhuan county manufactured land for a new area the size of Milwaukee.
  • Jiangsu Province is currently reclaiming 21 parcels of land from the Yellow Sea, totalling 1,817 km2. That’s the size of London and Munich combined.

New growth at Nanhui New City. Image: Wade Shepard.

More controversial than China extending the bounds of its own country is China reclaiming land in places where its jurisdiction is questionable. Along with China, the Philippines, Vietnam, Brunei, Malaysia, and Taiwan have also claimed parts of the Spratly Islands, in the South China Sea.

Under the U.N. Convention on the Law of the Sea, submerged oceanic features cannot be claimed as the domain of any country, but China found a loophole. It would dredge up sediment and dump it upon the submerged shoals in question, thus turning them into islands which could then be claimed – destabilising the entire region in the process. 

There are three main ways to reclaim land from the sea. The first is to excavate soil and stone from the mainland, shipping it out, and dumping it on the current coastline or at the edges of existing islands.

The second is hydraulic reclamation, which consists of dredging soil from the sea floor, mixing it with water, and then shooting it through a hose upon the desired reclamation site.

Last but not least, you can put up barrier walls outside of the mouth of a river, and then allow the area in between to silt up naturally – incrementally moving the barrier farther out until the desired amount of sediment has been collected.


Besides creating a valuable resource where one didn’t exist before, there are other advantages to reclaiming land. Taking land from the sea provides development-obsessed local governments the option to avoid demolishing yet more rural villages and relocating tens of thousands more people. Although China generally has no qualms about forcibly moving its citizens around the country like pieces on a game board – upwards of 4m people each year are booted from their homes to make way for development projects – reclaiming fresh land is often vastly cheaper, easier, and doesn’t carry the same potential for a social backlash.

Another reason is that China is at the point of breeching its so-called “red-line” – the 120m hectares of arable land that must be left available for agriculture. This food security quota isn’t adjusted when land is added onto the country – so filling in the sea with soil is a way to get more development land while leaving existing farmland intact.

“Farmland is extremely precious, especially along the coast where the cities are growing,” Fanny Hoffman-Loss, one of the architects that oversaw Nanhui, explains. “So it seemed to make sense to build into the sea.”

As one might expect, accompanying the huge profits inherent to land reclamation comes a huge environmental toll. Wetlands, mangrove forests, reefs, and coastal flats are eradicated as sediment is piled on top of them. This has the potential to wipe out entire populations of native plant and fish species, decimate the local fisheries, and increase the newly created area’s vulnerability to pollution, drought, flooding, and, especially, rising sea levels.

On top of this, the new cities and industrial zones that will be built on the new land will serve as new sources of pollution, dumping untold amounts of waste directly into the marine environment.

Yangshan Deep Water Port is another area of Shanghai built on reclaimed land. Image: Wade Shepard.

What’s more, many of these aquatic expansion projects may not even be built on solid ground. “A very big issue is that due to the high development pressure there is often not enough time for new land to become firm,” Delft’s Harry den Hartog explained. “The consequences can be serious, like damage to buildings and roads, which makes it not sustainable at all.”

During the 11th five year plan (2006-2010), China’s land reclamation frenzy was at its height, and under the auspices of the central government 700km2 of land – roughly the size of Singapore – was being created each year. But since then, the amount of land being reclaimed has been dialled back. In an attempts to prevent what was looking like a “land reclamation bubble” the amount of land that could be legally be created nationwide was reduced to 200km2 each year.

But that’s still a massive amount. And there is a loophole in the rules. Land reclamation projects below 50 hectares do not need central government approval, and are therefore not regulated. So municipalities and developers are now simply making many separate sub-50 hectare parcels, and then patchworking them together into vastly larger yields. Some of these have totalled 1,000 hectares.

Beyond this, China's National Development and Reform Commission has found that all of the country's coastal provinces have illegal reclamation projects in the works. And as the penalty – a fine – is often vastly less than the potential profit it is apparently still good business to build first and deal with the consequences later.

So while the central government has made attempts at regulation, large-scale land reclamation in China rolls on. Entire new cities, ports, and industrial zones continue sprouting up from places that were once only open water, as the country grows larger and larger each day. Where China will stop, nobody knows.

Wade Shepard is the author of "Ghost Cities of China".

Images courtesy of the author.

 
 
 
 

“Stop worrying about hairdressers”: The UK government has misdiagnosed its productivity problem

We’re going as fast as we can, here. Image: Getty.

Gonna level with you here, I have mixed feelings about this one. On the one hand, I’m a huge fan of schadenfreude, so learning that it the government has messed up in a previously unsuspected way gives me this sort of warm glow inside. On the other hand, the way it’s been screwing up is probably making the country poorer, and exacerbating the north south divide. So, mixed reviews really.

Here’s the story. This week the Centre for Cities (CfC) published a major report on Britain’s productivity problem. For the last 200 years, ever since the industrial revolution, this country has got steadily richer. Since the financial crash, though, that seems to have stopped.

The standard narrative on this has it that the problem lies in the ‘long tail’ of unproductive businesses – that is, those that produce less value per hour. Get those guys humming, the thinking goes, and the productivity problem is sorted.

But the CfC’s new report says that this is exactly wrong. The wrong tail: Why Britain’s ‘long tail’ is not the cause of its productivity problems (excellent pun, there) delves into the data on productivity in different types of businesses and different cities, to demonstrate two big points.

The first is that the long tail is the wrong place to look for productivity gains. Many low productivity businesses are low productivity for a reason:

The ability of manufacturing to automate certain processes, or the development of ever more sophisticated computer software in information and communications have greatly increased the output that a worker produces in these industries. But while a fitness instructor may use a smartphone today in place of a ghetto blaster in 1990, he or she can still only instruct one class at a time. And a waiter or waitress can only serve so many tables. Of course, improvements such as the introduction of handheld electronic devices allow orders to be sent to the kitchen more efficiently, will bring benefits, but this improvements won’t radically increase the output of the waiter.

I’d add to that: there is only so fast that people want to eat. There’s a physical limit on the number of diners any restaurant can actually feed.

At any rate, the result of this is that it’s stupid to expect local service businesses to make step changes in productivity. If we actually want to improve productivity we should focus on those which are exporting services to a bigger market.  There are fewer of these, but the potential gains are much bigger. Here’s a chart:

The y-axis reflects number of businesses at different productivities, shown on the x-axis. So bigger numbers on the left are bad; bigger numbers on the right are good. 

The question of which exporting businesses are struggling to expand productivity is what leads to the report’s second insight:

Specifically it is the underperformance of exporting businesses in cities outside of the Greater South East that causes not only divergences across the country in wages and standards of living, but also hampers national productivity. These cities in particular should be of greatest concern to policy makers attempting to improve UK productivity overall.

In other words, it turned out, again, to the north-south divide that did it. I’m shocked. Are you shocked? This is my shocked face.

The best way to demonstrate this shocking insight is with some more graphs. This first one shows the distribution of productivity in local services business in four different types of place: cities in the south east (GSE) in light green, cities in the rest of the country (RoGB) in dark green, non-urban areas in the south east in purple, non-urban areas everywhere else in turquoise.

The four lines are fairly consistent. The light green, representing south eastern cities has a lower peak on the left, meaning slightly fewer low productivity businesses, but is slightly higher on the right, meaning slightly more high productivity businesses. In other words, local services businesses in the south eastern cities are more productive than those elsewhere – but the gap is pretty narrow. 

Now check out the same graph for exporting businesses:

The differences are much more pronounced. Areas outside those south eastern cities have many more lower productivity businesses (the peaks on the left) and significantly fewer high productivity ones (the lower numbers on the right).

In fact, outside the south east, cities are actually less productive than non-urban areas. This is really not what you’d expect to see, and no a good sign for the health of the economy:

The report also uses a few specific examples to illustrate this point. Compare Reading, one of Britain’s richest medium sized cities, with Hull, one of its poorest:

Or, looking to bigger cities, here’s Bristol and Sheffield:

In both cases, the poorer northern cities are clearly lacking in high-value exporting businesses. This is a problem because these don’t just provide well-paying jobs now: they’re also the ones that have the potential to make productivity gains that can lead to even better jobs. The report concludes:

This is a major cause for concern for the national economy – the underperformance of these cities goes a long way to explain both why the rest of Britain lags behind the Greater South East and why it performs poorly on a

European level. To illustrate the impact, if all cities were as productive as those in the Greater South East, the British economy would be 15 per cent more productive and £225bn larger. This is equivalent to Britain being home to four extra city economies the size of Birmingham.

In other words, the lesson here is: stop worrying about the productivity of hairdressers. Start worrying about the productivity of Hull.


You can read the Centre for Cities’ full report here.

Jonn Elledge is the editor of CityMetric. He is on Twitter as @jonnelledge and on Facebook as JonnElledgeWrites

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