Moving mountains

China’s largest development firm is set to spend $3.58bn flattening 700 mountains in Lanzhou.

There is an ancient Chinese parable about an elderly peasant named Yu Gong, who spent a lifetime of hardship to move two mountains blocking the entrance to his home. Yu Gong has found reincarnation in the modern China Pacific Construction Group.

Along with several other construction firms, the Group will invest $3.58 billion to flatten 700 mountains on the outskirts of the northwestern industrial city of Lanzhou. The Lanzhou New Area, 500 square miles of land 50 miles from the main city, will be China’s fifth “state-level development zone”.

According to state-run newspaper, China Daily, the development has already attracted $11.39 billion of corporate investment and will eventually become a vast new urban district that will sprawl along for almost 10 miles.

Not everyone is convinced about the project’s feasibility. Tao Ran, an economics professor at Renmin University in Beijing, doesn’t expect developers will see a return on their investment. “If you have a booming real estate market it might work, but it seems to me that real estate in China is very, very risky”, says Tao.

In the past, over-invested, manmade conurbations in remote and undesirable locations have not fared well in China. For examply, Ordos, situated deep in the heart of Inner Mongolia, is frequently dubbed China’s “Ghost City”. At the beginning of the coal rush 20 years ago the local government pumped billions into construction, causing a bubble which is still hurting the local economy today.

This time it will be different, according China Pacific Construction Group spokeswoman Angie Wong. The Group's “protective style of development, and developmental style of protection” will create jobs and infrastructure in an area which is “already really poor”. Wong adds: “whether it’s England or America, or any other country, no one will cease development because of resource [or] geography.”