Billion-Person Boom Town

October 03, 1993|By HAL PIPER

China is working tonight. And shopping tonight.

On Nanjing Road, Shanghai's main commercial street, the glass-fronted, chrome-trimmed stores are open past 9 o'clock, past 10 o'clock. The neon-bathed streets pulse with life, like Manhattan's Midtown, Tokyo's Ginza, Hong Kong's Golden Mile, Berlin's Kurfuerstendamm. Like Shanghai itself before World War when it was dominated by foreign capital and was variously known as the Paris of the East, the Whore of China, the Pearl of the Orient. But Shanghai has been in eclipse; only a few years ago it was a stronghold of Red Guard puritanism.

A rush of deliciously cool air envelops the stroller passing the open doors of the Nanyang Center, luring him to the feast inside: Jeans West, Benetton, Ralph Lauren -- all major credit cards accepted.

A few doors down the street is a floodlit construction site. The second shift is digging dirt, chipping construction blocks, hauling gravel. Some of the workers are on break, sucking up noodles. In a couple of hours the third shift will check in. These days China works round the clock.

Suddenly, China's is the world's most dynamic economy. Imagine a boom town -- say a gold-rush city or a sleepy hamlet that happens to sit where the government has decided to build an airport or a freeway. Suddenly there's money to burn, jobs for everyone. Everybody's working overtime, everybody's flush, seeking a short cut to the good life. Prices explode.

Now imagine these boom times on a scale of 1.1 billion people, one-fifth of humanity. China's growth rate last year was about 13 percent. This year it was rising, and the government decided to throttle back the economy before inflation (near 20 percent in the cities) eats up all the gains.

But in China, even austerity feeds growth. The manufactured credit crunch means high interest rates, which have lured more money into banks. So this year the government has cash on hand to pay farmers, who in past years sometimes had to make do with IOUs. Now the farmers can join the spending binge.

Of course, it's easier to grow if you start out small. Economists disagree on just how much economic potential China has. By traditional measures, China's economy is anemic for such a huge country; the value of all its goods and services is less than what Spain produces with one-thirtieth of China's population. China could keep growing at 13 percent for the rest of the century without overtaking Italy.

A revisionist accounting came out earlier this year. Re-weighting the statistics to reflect purchasing power in the local economy, the International Monetary Fund concluded that China already has the world's third-largest economy, trailing only the United States and Japan.

China is clearly a country in transition. The ancient Greeks said you could never step in the same river twice, because the river was never the same; the water you stepped in flows away and a new river replaces it.

China is like that. In Shanghai, whole square blocks of graceful, French-accented buildings from colonial days are boarded up. Signboards portray the joint-venture hotels and office skyscrapers that will replace them.

In Beijing, resident Westerners say that in two years the place is hardly recognizable. Traffic is thicker, the skyline higher, the people better dressed and bolder in conversation. The once omnipresent political slogans have been replaced by business come-ons touting China's openness to Western venture capital.

Other signs read, "A more open China awaits the 2000 Olympics." The tacit admission is that not long ago there was a "less open China," and human-rights groups (and the U.S. Congress) have charged that China is still not open enough.

The Beijing government obviously treated the award of the site for the millennial Olympic games (Beijing lost out to Sydney, Australia) as a potential acknowledgment of China's return to the world of nations after more than 40 years of self-isolation under communism.

For all its recent progress, China is still in many ways a Third World country. The country teems with construction work, almost all of it being done manually. In the Yangtze River town of Yueyang, men with shovels unload a gravel barge. Upriver, in Chongqing, platoons of squatting men shape building stone with hammers and chisels. All over China, men and women bearing burdens scamper through the streets, dodging bicycles, carrying their loads in paired baskets slung from bamboo shoulder poles.

But all this coolie labor is both a hallmark of a Third World country and a contrast. Elsewhere in the less-developed world idleness walks the streets; construction projects are begun and then abandoned; able-bodied men sit in the sun swapping stories; selling lottery tickets is considered employment. In Beijing, unemployed able-bodied men sit at curbsides with placards advertising their skills: laborer, mason, carpenter. They believe they have a reasonable prospect of getting a day's work, maybe more.

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