Binhai New Area officials say that the area is poised for success. After all, it's close to Beijing, it's home to a thriving seaport, and it has strong support from the central government. They envision its highways choked with cars, its hotels booked to capacity, its office towers generating strong returns. Yet the city's goals could be too big to achieve. The mammoth state-owned enterprise Tianjin Infrastructure Construction and Investment Group Co. recorded over $45 billion of debt in 2011, more than any other local government financing vehicle in China. Another local financing vehicle recently sold control of a $1 billion securities firm to a state-owned bank to help minimize its debts. If the area's investment pipelines dry up, Binhai could end up a ghost town, its half-built high-rises forever uninhabited.
Locals point to the thriving Tianjin Economic-Technological Development Area (TEDA), a special administrative zone within Binhai, as an indicator of the area's potential success. TEDA was established in 1984 with approval from then-paramount leader Deng Xiaoping. An impressive list of Fortune 500 companies has established offices there, including Nestlé, Motorola, and Airbus. A TEDA promotional booklet boasts that the area has attracted residents from over 30 "overseas regions" and countries. "You are welcome to get a taste of this melting pot of cultures, languages, customs, peace, and harmony," it says.
An exhibition hall in the TEDA government office is a testament to the strange aesthetics that arise from coupling stodgy officialdom with a sleek corporate ethos. One room is outfitted with a table-sized touch screen displaying animated butterflies in a grassy meadow. An exhibition hall staff member told me to rub one of the butterflies. When I did, it unfurled into a photograph of TEDA officials at a formal reception holding award certificates and placards. My tour ended in a small theater, where I put on 3-D glasses and watched a computer-animated movie about the area's long-term plans. It involved a 19th-century schooner floating above a skyscraper-filled metropolis. Its English-language soundtrack was incomprehensible.
Just down the road, the Yujiapu Financial District underscores Binhai's long-term risks. The district is a 1.5 square-mile, decade-long construction project that authorities say will someday be the largest financial center in the world -- a veritable replica of Manhattan, complete with an underground shopping mall, a three-tiered train station, and a homegrown Rockefeller Center. It's currently a forest of cranes. "For Tianjin to become a major financial center, that would imply that somebody else would move down the ranks, and I can't see that happening for Shenzhen or Shanghai or Beijing," said Fraser Howie, the managing director of CLSA Asia-Pacific Markets in Singapore and an expert on China's financial system. "The chances of bringing people there I think are going to be remote."
My last stop on the trip was the Binhai International Convention and Exhibition Center -- a pocket within TEDA comprised of the exhibition hall, a light-rail station, a shopping mall, and a stadium used by TEDA's own soccer team. A program director at the exhibition center, Guan Xu, walked me slowly through the cavernous, empty space, and he explained that government subsidies allow it to maintain a healthy cash flow. Analysts explained that recording a healthy cash flow makes the area appear fiscally sustainable; maintaining an appearance of fiscal sustainability could help the area attract additional investment. "As with any investment, there's an initial period where you're hungry for businesses, and you can't say you have a 100,000 square-foot exhibition hall and it's in ruins," Howie said.
As we walked outside, Guan admitted that the area's emptiness could be overwhelming. "In Binhai, productivity is everything," he said. It was pouring rain, and the puddles reflected a colorless landscape of vast public plazas and unadorned concrete. I asked Guan how he occupies himself on the weekends. He pointed at a collection of white plastic chairs and bright red awnings outside the exhibition hall -- a beer garden. I asked whether it was any fun. "Nobody really goes there," Guan said, shaking his head. "Perhaps they haven't done enough advertising."
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