In possession of a uniquely advantageous geographical position within China, the „River City“ of Wuhan is preparing for a great economic boom. It has been one of China’s big metropolises for ages; it is the commercial, financial, political, cultural, and transportation center of the whole central region; and it has shown healthy growth rates for decades. But for many, Wuhan seems to be a place that is yet undervalued though anticipating the big bang. 

Can the possibly optimal place for economic synergies and strong growth be neglected within a country on the move? Not really. But it seems that Wuhan, a city offering an impressive industrial base and nearly everything needed for fast development, has not been favored by the ambitious pro-developmental strive of China’s central government so far. But now, having seen cities booming all around, something is about to change regarding the pace with which Wuhan is moving forward.

Lying halfway between Beijing and Hong Kong, or Shanghai and Chengdu respectively, Wuhan is sitting on the confluence of the world’s third largest river with its main tributary. It is the capital of Hubei province where the overthrow of the Qing emperor had once been triggered, and it can easily be accessed from most directions, making it virtually a „thoroughfare of 9 provinces“. The megacity in the heart of China’s core regions comprises ten million people in the „three towns“ that make up Wuhan and which are divided by the Yangtze and the Han rivers: Hankou is a commercial and financial hotspot; Wuchang is the political, cultural, and educational center; and Hanyang is the city’s modern industrial base. Anyhow, Wuhan has not yet been kissed fully awake by the catalyst spirit that other Chinese cities have encountered. Only recent plans indicate that something big is in the making: The “8 plus 1 city center” will integrate Wuhan as the master of a big metropolitan area of about 30 million people, thereby enabling it to form economic synergies and to fuel the process of intraregional cluster building.

Due to its key location within China, high-speed trains were built quite early, connecting Wuhan with the core regions nationally and the main cities regionally. But it should be mentioned that the routes to Beijing and Guangzhou are on a much faster track than the routes to Shanghai and Chongqing even though the latter cities are actually much closer. Wuhan was one of the first cities in China to open a metro, but the developmental speed of the infrastructure slowed down a bit compared to other inland cities. There are now only two metro lines in operation; altogether twelve lines and thirteen suburban lines are being planned. But there is also the Intercity Railway within the „metropolitan area“ that connects the main railway stations and the airport. Wuhan’s international airport is serving many cities in East and Southeast Asia, as well as Paris, Moscow, San Francisco, Rome, Queensland and the Maledives. The city owns an important inland port and a big freight rail station.

The economy of Wuhan is diversified and well-balanced between the secondary and tertiary sector. Its growth rate is above China’s average, making a plus of 9.5 percent in 2014. Wuhan’s main pillars of the industry mostly date back to times when other cities that are now booming were much behind: automotive industry, metallurgy, equipment manufacturing, petrochemicals, optoelectronics, biopharmaceutical products, and food and beverages. In this respect, Wuhan is aiming to modernize its manufacturing processes and techniques, to enhance the level of technological expertise, and to form industry clusters.

The national-level ETDZ with its export-processing zone is strong in the relatively traditional industries of the city. East Lake New Technology Development Zone, also at national-level, incorporates the Optical Valley Software Park that was established in cooperation with Dalian Software Park. It comprises technology parks for bio-innovation, bio-pharma, bio-agriculture, bio-manufacturing, medical device, and medical health. In Wuhan, some strategic emerging industries have also turned up, like IT, advanced materials, energy saving, environmental protection, and biotechnology.

Wuhan is the top financial city of central China, but it is facing upcoming competition, as nearby Changsha and Zhengzhou have modernized their economies recently. Companies in Wuhan can rely on a considerable workforce with industrial knowledge, as the city is China’s number three in terms of higher education and scientific research, just after Beijing and Shanghai. Wuhan’s retail sector is very strong as well, and real estate is growing at healthy rates, profiting from infrastructural plans for metro expansion. Some areas may be favorable due to their scenic location, as Wuhan’s proportion of water to land is highest among the major cities of China. (Wuhan’s East Lake alone is about six times larger than Hangzhou’s West Lake.) Due to its favorable location, industrial incentives, and the high level of education, many foreign countries are investing in Wuhan. France (being particularyly highly invested here), the US, the UK, and Korea have estasblished consulates in the city.

Although Wuhan is sitting in the middle of the country’s four economic core regions (all within a range of 1.000 km) and offering a truly favorable location, in comparison to these areas the city seems to be a bit neglected. Three of the core regions, the Pearl River Delta, the Yangtze River Delta, and the Bohai Rim Region, are areas situated near the coast. When the boom went inland, Chongqing and Chengdu performed best, and Wuhan was Kind of passed over. To take a different perspective on Wuhan’s standing: Compared to the recent boomtowns Changsha, Zhengzhou, Hefei, and Nanchang (all within a 300 km radius), Wuhan stands out as the only megacity and most developed town.

Now there are several other cities in the interior which deserve being dubbed boomtowns while Wuhan has already been a well-developed city for a long time. It grew healthily when Shanghai had its heyday, and also when Chongqing outpaced it, Wuhan continued to move up the ladder. Within central China, a region that now shows staggering growth rates, Wuhan’s prime position is not really endangered, as it clearly is the biggest metropolis of the region and a leader in many respects. A closer interconnection and regional competition will encourage modernization and development within Hubei province. By this process, the full significance of Wuhan’s location within the whole of China will ultimately surface and contribute to an upgrade in attractiveness for specific government support as well as for national and invernational investors.

Being the only megacity in central China, sitting in a unique geographical position and already connected to the core engines of growth in China, one of the things that may trigger more rapid economic development in Wuhan is intraregional competition and – at a smaller geographical scale – intraregional cooperation. The genesis of other, smaller boomtowns within central China, and the creation of a bigger metropolitan area around Wuhan could be valuable ingredients. As it is a main concern of the central government to initiate high growth rates and sustainable modernization in different cities in China’s interior, it may be desired that other towns in the region outperform Wuhan for some time in order to improve their competitive standing. But once Wuhan will be connected to Chongqing and Shanghai by faster train service, and complemented by more favorable preferential policies and better infrastructure (e.g. a more dense metro line network), things are looking especially well that Wuhan will develop into an indispensable strategic economic base.

© China Under Construction, 2015

Links of interest

Wuhan’s Drive to Become China’s Car City (The Guardian)

New Drives of Wuhan’s Economy (Hubei Provincial People’s Government)

The Ideal Innovation Hub: Wuhan, China (Sasaki)

Wuhan is China’s Happiest City, Survey Says (Sixth Tone)

China’s Wuhan Shifts Away from Steel as Economy Slows (Irish Times)

The Test of China’s Next Stage of Development: The Rise of Wuhan (Greater Pacific Capital)

Wu-Where? Opportunity Now In China’s Inland Cities (National Public Radio)