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Chongqing

Situated in southwest China, Chongqing is one of China’s four municipalities and the only one in the interior. Surrounded by mountains and intersected by the Yangtze and its tributary the Jialing River, Chongqing is the largest commercial and industrial centre in the interior of China.

Between 1937 and 1945, when Japanese troops occupied Nanjing, the city was regarded as a safe haven and was chosen as the capital of the Kuomintang government. Despite heavy bombing by the Japanese, its population tripled during this time and many important institutions and industries were relocated here, laying the initial foundations for its industrial power base. China’s future paramount leader Deng Xiaoping was the city’s first mayor after the People’s Republic was founded in 1949.

In 1997, Chongqing was removed from Sichuan province to become a municipality under the jurisdiction of the central government and it is now, in terms of population, the largest city in the world. It has a rapidly growing population of 32m and an area of 82,000 sq km – larger than Austria. However, the vast majority of its area is classified as rural; only 8.24m people live in the city proper.

The city’s increasing importance in China’s overall economic landscape was evident in its selection, together with Chengdu, as the national testing ground for urban and rural cohesive development, a political and economic initiative launched by the ruling Communist Party in early 2007 that addresses the pressing issue of growing economic disparity. The initiative marked the beginning of a new economic era for China as its central government begins its long process to raise living standards for the entire population. In December 2007 the central government appointed Bo Xilai, China’s former Minister of Commerce, to the position of Chongqing’s Communist Party Secretary, hoping that he would help the city raise its international profile.

Despite the progress that has been made on the nearby Three Gorges Dam project, public finances in Chongqing are being stretched by the need to resettle people made homeless by the massive hydroelectric scheme. At the end of 2009 the municipal government announced the completion of the city’s Rmb54bn relocation work for the dam project. Altogether, 1.14m people were resettled and nearly 1,400 companies and factories were relocated. In addition, under Chongqing’s 2007-2020 Urban and Rural Development Plan, a further 4m people will be encouraged to resettle. The resettlement is deemed necessary to protect the ecology of the reservoir formed by the dam.

Chongqing is a pillar of China’s ‘go west’ programme, which is aimed at encouraging the growth of industry in the inland western and central regions of the country and reducing the vast disparities in income that exist between these regions and the coastal provinces. Multinational companies with a presence here include BP, Nokia, ABB, Mitsubishi, Carrefour, Wal-Mart and Isuzu. Northern Telecom, Ericsson, Lafarge, Hewlett-Packard, Mobil, Fiat, Ford, Suzuki, Honda and Samsung also have operations in the city.

Chongqing’s industries have developed rapidly in recent years. Pillar sectors, including automobiles, chemicals and pharmaceuticals, are being restructured. Many military factories, set up after 1949 for reasons of strategic security but long since uncompetitive, have been converted to civilian use. Attracted by lower production costs, a number of prominent domestic appliance manufacturers whose production was previously concentrated in coastal provinces – including Haier, Midea, TCL, Gree and Gless – have set up operations here. Major export items include motorcycles, automobiles, auto parts, chemicals, pharmaceuticals, agricultural products and light industrial goods.

In the past, poor transportation infrastructure has deterred foreign investors. Now, however, it is becoming a more attractive proposition. Located further upstream than any other significant port on the Yangtze, Chongqing is the major transhipment point for outgoing freight originating in southwest China. Significant funds have been set aside to improve the local transport network, and generally the city has undergone a major programme of reconstruction and renovation; its hills are now covered with new office blocks and high-rise apartment buildings.

Power supply has long been a serious problem in Chongqing, and this has prompted the local government to invest heavily in the construction of power sources and urban power grids. During the hot summer months, when temperatures can reach 40°C, the use of air-conditioning units often stretches the electricity grid to breaking point.

With the city highly dependent on coal as a source of power, air pollution is a serious health concern; the precipitous hills that surround it exacerbate the problem. Acid rain, smoky humidity in hot summers and persistent winter smog can make Chongqing an uncomfortable place in which to live.

In 2008 Chongqing started a five-year project to upgrade its traffic network. The Rmb300bn project is designed to turn the municipality into a major transportation hub in southwest China. Local authorities plan that by 2012, expressways will connect the city centre with anywhere else in the municipality to a maximum of four hours, and that all capital cities of neighbouring provinces such as Shaanxi, Sichuan, Guizhou, Hunan and Hubei should be accessible within eight hours. By 2014 the travel time by rail between Chongqing and capital cities of its neighbouring provinces will be reduced to within four hours. Jiangbei airport will also be upgraded into a first-level international facility.

Located further upstream than any other significant port on the Yangtze, Chongqing enjoys a huge catchment area and is today the major transhipment point for outgoing freight originating in southwest China. Its emergence has been both recent and rapid. At the start of this century, there were no container terminal facilities at all on the upper Yangtze. In 2009 Chongqing port including Wanzhou reported a container throughput of 517,800 TEU.

If you want to read more about Chongqing, its leading companies, major investment zones, transport network, port infrastructure and the logistics experience of FIEs in the city, click here to order an e-version of the city profile for £15. Alternatively, for information on all the major Yangtze port cities and much else besides, click here to buy Yangtze Transport: Accessing China's Interior for £85.

     
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