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Qingdao: Towards a Blue Economic Zone
Qingdao has numerous natural, economic, and historical advantages in developing its own specific urban pathway in close relation to its maritime position. The city was a 19th-century treaty port, as the European powers recognised the quality of its harbour and its significant location on the East China Sea. The city still has distinctive European architecture alongside fine examples in the Chinese tradition.
Qingdao has a large and protected harbour, a beautiful coastline, and is ideally situated for seaborne exchange with the key economies of Japan and South Korea – both of which have a significant presence in the regional economy. Allied to its traditional trading role, the city has concentrated on research and development, putting the city at the forefront of new maritime industries.
An Overview of Qingdao
Qingdao is located in the south of the Shandong Peninsula, bordered to the east and south by the Yellow Sea, to the northeast by the city of Yantai, on the west by the city of Weifang, and to the southwest by the city of Rizhao. The total area of the city is 11,282 km2. The sub-provincial city of Qingdao has direct jurisdiction over six districts and four county-level cities. Shinan (市南区), the old downtown, is located in the south of Qingdao city proper. The new downtown of Shibei (市北新区) lies in the centre of the city while Licang (李沧区) is located further up the peninsula on the city’s outskirts. At the end of 2014, the city’s total population was 9,046,200, of which 4,875,900 made up the urban resident population. From 2012 to 2014, Qingdao was the twentieth, fourteenth, and eighteenth respectively in the ranking list of China’s Urban Transformation and Upgrading Capability.
According to the Qingdao Master Plan (2011–20), the urban population of the central city will be 6.1 million by 2020, the urban construction land area will be 660 km2, and the per capita construction land area will be 108 m2.
Qingdao is an important tourist city with a rich cultural heritage. The old west part of the city is redolent of Qingdao’s past as a German treaty port. The eastern district is in a modern international urban style. The middle part of the city has strong elements of the Jiaodong style of folk culture, and the outskirts of the city have many ancient cultural sites.
In 2014, the city’s GDP was CNY869.21 billion, a per capita GDP of CNY96,524. The added value of primary industry accounted for CNY36.26 billion, the added value of secondary industry was CNY388.24 billion, and that of tertiary industry was CNY444.71 billion. The ratio of the three sectors was 4.2:44.6:51.2.
Figure 9.1: Qingdao Olympic Sailing Centre
Figure 9.2: Ba Da Guan Treaty Port Architecture in Qingdao
Qingdao has excellent bays and coastal resources. Its port was founded in 1892 and is now operated by a state-owned enterprise. Qingdao’s historical success lies in its advantageous coastal position with a harbour which is wide, deep, and navigable all year round. Qingdao’s status first as one of 14 approved coastal port cities from April 1984 and then as one of 15 sub-provincial cities from February 1994 has made it an important international trade port and sea transport hub.
This makes Qingdao one of the most important economic centres on the east coast of China. As the central city of the Shandong Peninsula city cluster, Qingdao has the following foci: a centre for company headquarters, an R&D centre, brand economy, exhibition economy, information service industry, commerce, trade flow, and all kinds of manufacturing service industry. All this provides a high-end platform for the economic development of Shandong.
From the perspective of traditional industry, Qingdao is competitive in locomotive vehicles, shipbuilding, marine industry, electronics and home appliances, petrochemical processing, car manufacturing, machinery, rubber, steel and iron, food, and light industry. In terms of new industry, Qingdao is developing marine industry, biological medicine, helicopter manufacturing, new energy, new materials, packaging innovation, and software.
Urban Space Restructuring and Expansion
Figure 9.3: Qingdao Harbour
The development and evolution of urban space should be a function of urban, economic, and social development. Qingdao’s urban space structure has evolved in three main phases:
- ■ A long period from 1891 to 1988, when its special expression had distinct belt features. In the early part of this period when Qingdao was occupied by Germany (1898–1914), it developed along the east shore of Jiaozhou Gulf from south to north. From 1949 to the end of 1980, Qingdao’s urban structure followed the original belt-shaped spatial layout. The main urban area was highly developed, but not so the immediate rural hinterland, which seriously hindered the balanced development of the city.
- ■ From 1989 to 2002, when the city shifted from ‘belt’ shape to ‘∠’ shape. From 1989, adjustment to the original urban general planning pushed development along Jiaozhou Gulf. The east and west wings of Jiaozhou Gulf developed quickly and the central urban district was transformed from a ‘belt’ shape to the shape of a Chinese character ‘品’. In 1995, the general planning office defined the urban general layout as ‘two districts and one cluster’. The east shore of Jiaozhou Gulf was the main urban district, the west shore was the auxiliary district, and the district along Jiaozhou Gulf would form a cluster. In this way, the urban structure feature was ‘relatively concentrated and appropriately dispersed’.
- ■ From 2002 to the present Qingdao has expanded from the shape of ‘∠’ to the shape of ‘Ω’ as a result of important decisions made by the Qingdao Municipal Government. First, growth to the west made the shape of ‘品’. This was followed by expansion to the north, characterised as ‘one gulf, two wings, and three poles’, and the strategy was called ‘development along the gulf’.
Figure 9.4:
Jiaozhou Qingdao Bay Bridge
In November 2007, Qingdao Municipal Government put forward the strategy of ‘development along Jiaozhou Gulf’. A bigger urban framework with ‘one main district, three auxiliary districts, and multi clusters’ came into being, along with urban development based in the main district – developing the city along the gulf with radiation towards all clusters. The strategy of ‘development along the gulf’ is in essence an industrial spatial expansion strategy. After the east expansion in the 1990s and the west shift in the early 21st century, advancing towards the north and developing along the gulf is inevitable under the national rigid restraint of land resources. The core strategy is to help the city reclaim land from the sea.
Developing a Marine Economy and Building the Blue Economic Zone
Basic Conditions for the Construction of the Blue Economic Core Area
Figure 9.5: Qingdao Liuting International Airport
In the early 1990s, Shandong Province implemented the ‘Sea Strategy of Shandong’. At the beginning of 2011, the State Council officially approved the Shandong Peninsula Blue Economic Zone Development Plan – the first regional development strategy focusing on marine economy in China. The approval for the implementation of the Plan means regional development extending from the land economy to the marine economy. The construction of Shandong Peninsula Blue Economic Zone is part of a national strategy, with Qingdao City leading.
Qingdao has four major advantages in the development of such a zone:
- ■ Its good geographical location and natural resources. Across the East China Sea lie the large economies of Japan and South Korea, while to the west Qingdao can serve the extensive Yellow River Basin area. Qingdao’s marine hinterland comprises offshore seas of 1.22 million km2, tidal flats of 375.3 km2, and coastline of 711 km. In the vicinity are 69 islands and 49 natural harbours. There are abundant marine biological resources. Qingdao is a perfect combination of ‘mountain, sea, city, culture, and business’.
- ■ Not surprisingly, Qingdao has strong capacity in marine science and technology. It has 28 marine scientific research and development institutions, accounting for one-third of those in China. There are more than 5,000 professional and technical personnel in Qingdao.
- ■ The geographical and natural environment also encourages marine industry. Marine fishery, port logistics, ship manufacturing, and coastal tourism are all on the increase. More recently, marine biological products, marine drugs, and seawater desalination have emerged and thrived. In particular, the output of marine biological pharmaceutical products accounts for 40 per cent of China’s production.
- ■ Infrastructure is being developed to take advantage of these natural benefits and economic development. In 2012, the cargo throughput reached 0.4069 billion tons. This and container throughput are now among the world’s top ten. Take-off and landing capability at Qingdao Liuting International Airport has reached 4E class standards, and its airport passenger throughput in 2010 reached 10 million people. The construction of a second airport, Qingdao Jiaodong International Airport, began in 2015 as a ‘regional hub airport, the gateway to Japan and South Korea’. The highway traffic mileage of Qingdao, over 17,000 km in 2015, ranks first place among the national sub-provincial cities.
The Progress in Building the Blue Economic Core Area
Qingdao has become an exemplar of the ‘Blue Economy, high-end manufacturing and strategic new emerging industry’.1 While the scale of marine economy is increasing in general, the structure of three particular sectors has been optimised and has become the driving force for the transformation and upgrading of Qingdao.
The scale of the marine economy is increasing rapidly year on year. The output value of the marine economy increased from CNY66.5 billion in 2009 to CNY175.11 billion in 2014, accounting for 20.2 per cent of GDP. The four pillar industries are coastal tourism, marine transportation, marine equipment manufacturing, and relevant material manufacturing, whose output value reached CNY116.63 billion yuan, accounting for 66.6 per cent of the marine economy.
The industrial structure of marine industry has been optimised through a shift towards the secondary and tertiary sectors. In 2014, the added value from the primary industry of marine economy was CNY9.41 billion, from secondary industry of marine economy was CNY79.81 billion; and from tertiary industry of marine economy was CNY85.89 billion. The ratio of the three sectors within the marine economy was then 5.4:45.6:49.1.
Towards the Blue Economy
The ultimate aim of Qingdao’s new form of marine or ‘blue’ economy is to become a model city that can realise harmony between human beings and the sea. According to the Shandong Peninsula Blue Economic Zone Development Plan, by 2020 Qingdao will have become a regional centre of marine industry, Northeast Asia international shipping, and international marine science and technology education, as well as an international coastal tourist and maritime sports resort.
Measuring the Development of the Blue Economy
Seeing the whole picture to optimise layout. Within the urban spatial strategy, Qingdao has now completed the overall plan of its Blue Economy Development Zone with three specific elements: the West Coastal Economic Zone, Blue Silicon Valley, and the Red Island Economic Zone. This is supported by 17 special plans and 12 urban district plans. The West Coast Economic Area will be a ‘high-end international marine industry gathering area, international shipping hub, marine economy demonstration area of international cooperation, national land and sea rural development pilot area, and Shandong Peninsula Blue Economic Zone pilot area’.2 In order to make full use of the unique advantages of marine science and technology, the Blue Silicon Valley will be a world-class centre of research and development, talent agglomeration, and marine industry training. The Red Island Economic Zone will also be a key area for technology, and an ecological and cultural city.
Figure 9.6: West Coast Economic Zone
Figure 9.7: Ocean University of China, Located in Blue Silicon Valley
A transformative conceptual shift to make marine resources the centre of economic development. Pilot reforms in the fields of finance, ocean transportation, shipping, and administration are significant because marine industry demands high input, and has high risks and a long return cycle on investment. In 2012, in order to solve the financing issue Qingdao became a debt financing pilot city with the authorisation to pick several qualified SMEs to issue interbank bonds. And now Qingdao has become one of the second group of pilot cities entitled to facilitate cross-border CNY settlement. The long-term significance is that the West Coast Economic Zone is set to take the lead in adjusting administrative divisions in accordance with the principle of simplification, unification, and efficiency. At the same time, Qingdao Municipal Administration has transferred more than 300 items of administrative approval authority to lower levels.
Opening-up and cooperation is seen as the driving force to gather resources from all over the world. Qingdao tries its best to promote multilevel, all-round domestic, and international cooperation. The West Coast Economic Area is positioned in Qingdao’s International Economic Cooperation Zone, within which there is a Sino–German Ecopark that promotes green building and low-carbon industry. Cooperation among the governments of the Blue Economic Zone of Shandong Peninsula can achieve mutual benefits for all the participants.
New innovative platforms to implement the ‘Blue Silicon Valley’ strategy. In 2011, Qingdao established the ‘Blue Silicon Valley’ strategy. Now it has been incorporated into the national marine economic development plan. The platform of marine industry includes the functions of R&D and incubation, attracting top marine scientific research institutions and enterprises. Many national innovation platforms have been set up including the National Deep-sea Base, Qingdao Ocean Science and Technology National Laboratory, and Qingdao Marine Geology Research Institute. Relying on these innovation platforms, there already have been scientific and technological achievements. For example, the ‘Kexue’ Research Vessel – the most advanced comprehensive marine science survey ship in China – has been put into use. The deep-sea submersible named ‘Dragon’ has successfully dived to deeper than 7,000 m.
Complexes of ‘scientific research, production and marketing’, to promote the cooperation between government, research institutes, and industry. The Blue Economy needs intensive investment of technology, talents and capital. On the basis of science and technology platforms, Qingdao promotes the establishment of a series of ‘scientific research–production–market’ complexes to promote the industrialisation of scientific and technological achievements. For example, Qingdao Better Biological Technology Co., Ltd makes investments to incubate and proceed pilot plant tests on scientific and technological achievements. The company has implemented large-scale production in the industrial park, turning ordinary dried shrimp into biological products and then exports to Europe and the United States.
An industrial pathway with a clear direction: ‘leading project – industry chain – industrial cluster – industrial park’. Qingdao continues to improve its industrial parks’ carrying capacity. It promotes the concentration of marine industry projects, so the industrial parks become important carriers of ‘enterprises, industrial clusters, relevant resources, and administrative functions’.
Figure 9.8: ‘Kexue’, the Comprehensive Marine Science Survey Ship
Figure 9.9: Model of ‘Dragon’ Deep-sea Submersible, www.quanjing.com