Shang­hai Dis­ney­land From Mao to Mickey Mouse

Though cap­i­tal­ism and so­cial­ism make strange bed­fel­lows, it is less known that the largest backer of Dis­ney­land is the Com­mu­nist Party it­self

The Financial Express - - REFLECT - ANURAG VISWANATH

THIS sum­mer, Walt Dis­ney’s $5.5-bil­lion Dis­ney­land—an ex­trav­a­ganza of a nar­rowly-con­strued “Amer­i­can fan­tasy”—fi­nally opened its doors in Shang­hai, China. This was to a largely cu­ri­ous do­mes­tic au­di­ence who, up un­til now, had been un­able to af­ford the lux­ury of next-door Hong Kong’s Dis­ney­land. Cer­tainly, the mad rush at Shang­hai’s Dis­ney­land—lo­cated at the south-eastern fringes of Pudong, which un­til 1990s was marshes, farm­land and herds­men, so-to-speak an area on Shang­hai’s fringe—is to be seen to be be­lieved. In the meta­mor­pho­sis of the Pudong marshes and the com­ing of Mickey Mouse to Mao’s land, hangs many a tale.

But first the eu­pho­ria. De­spite the ex­or­bi­tantly-priced en­try ticket to Dis­ney­land (RMB 499 for peak sea­son, about R4,900), folks, both ur­ban and ru­ral, young and old, have not stopped mak­ing a bee­line—and this in a coun­try where the av­er­age dis­pos­able in­come is RMB 1,830 (about R18,000). Three-hour ser­pen­tine queues for flight sim­u­la­tor “Soar­ing Over the Hori­zon”, the par­tial clo­sure of “Ad­ven­ture Isle Roaring Rapids” and the scorch­ing Shang­hai sum­mer heat didn’t de­ter crowds who flocked armed with para­sols, wa­ter bot­tles and a few sport­ing the ubiq­ui­tous Mickey Mouse T-shirts. Dis­ney­land is ex­pect­ing 20 mil­lion vis­i­tors in 2017. Chi­nese Tourism spend­ing is es­ti­mated at $610 bil­lion in China and abroad. There are about 120 mil­lion out­bound Chi­nese tourists—six times the num­ber of out­bound In­dian tourists (20 mil­lion). China’s do­mes­tic tourism is high dur­ing the two “golden weeks” (Na­tional Day in Oc­to­ber and Spring Fes­ti­val in Fe­bru­ary) and is on the up­surge. Mickey Mouse wants to cash in.

What does the ar­rival of Mickey Mouse in China mean? While there are lit­tle doubts about the sheer elas­tic­ity of China’s “so­cial­ism with Chi­nese char­ac­ter­is­tics”, the bot­tom line is Com­mu­nist Party’s propen­sity for hard-nosed eco­nomics—where tourism and, de facto, con­sump­tion is the new mojo.

Cer­tainly, Dis­ney­land did not hap­pen overnight, but came with the care­ful cul­ti­va­tion of Pudong.

Noth­ing ex­em­pli­fies Pudong more than China’s mod­erniser-parex­cel­lence Deng Xiaoping’s adage “build nests, the birds will come”. Pudong, an area on the wrong side of the Huangpu River, was long bar­ren un­til it was iden­ti­fied as the “dragon-head of re­forms” by none other than Deng Xiaoping in 1992. Since then, the ur­ban­i­sa­tion of Pudong has been phe­nom­e­nal—at­tested by the world’s sec­ond-tallest sky­scraper, Shang­hai Tower. Pudong is a mir­ror to China’s ur­ban­i­sa­tion, from 17.9% in 1978 to 53.7% in 2013. To­day, ur­ban­i­sa­tion—a la Pudong— has been iden­ti­fied as the core strat­egy for de­vel­op­ment by the Na­tional Ur­ban­i­sa­tion Plan (2014-20), with the ob­jec­tive of 60% ur­ban­i­sa­tion by 2020. Of course, Pudong has been suc­cess­ful, but the blind pre­cip­i­tous imi­ta­tion of the Pudong strat­egy else­where by lo­cal gover nments has back­fired. In fact, schol­ars and crit­ics de­cry the same as “forced ur­ban­i­sa­tion”. That said, the sheer weight of state-led ini­tia­tive to ur­banise Pudong is no less lauda­tory.

Sec­ond, while busi­ness in In­dia de­pends on po­lit­i­cal weather and ide­o­log­i­cal rhetoric, Dis­ney­land was em­braced with flex­i­bil­ity, if you please, to ac­com­mo­date ide­o­log­i­cal lightweights such as Mickey and his friends. Dis­ney­land wit­nessed lit­tle or no po­lit­i­cal upheavals (notwith­stand­ing po­lit­i­cal suc­ces­sion strug­gles at Bei­jing)—when the Com­mu­nist Party gave the com­mit­ment, it was for the long haul—start to fin­ish.

While In­dia con­tin­ues to strug­gle with land ac­qui­si­tion, with the onus for ac­qui­si­tion rest­ing on states, China does it swiftly and top-down. Dis­ney­land cov­ers 960 acres, nine times the size of Com­mon­wealth Games Vil­lage, New Delhi—leading up to the re­lo­ca­tion of 150 fac­to­ries and the re­set­tle­ment of 2,000 house­holds be­long­ing to four town­ships. At last count, there was no so­cial as­sess­ment project, but there was no wide­spread bungling of fi­nances in the re­set­tle­ment ei­ther.

Thus, busi­ness in China largely rides on the dik­tat of the Party, which has a long-term vi­sion. Dis­ney­land was a hard-won fight with lob­by­ing and ne­go­ti­a­tions, start­ing in the late 1990s. The chief ex­ec­u­tive of Dis­ney, Robert Iger, first vis­ited Com­mu­nist Party leader Yu Zheng­sheng in Shang­hai in 2008. To Dis­ney’s credit, a pho­to­graph of se­nior Xi (fa­ther of cur­rent Chi­nese Pres­i­dent Xi Jin­ping) shak­ing hands with Mickey Mouse at Dis­ney­land (pre­sum­ably in Cal­i­for­nia) in 1980 ap­peared as a to­ken of friend­ship—no doubt, a ver­i­ta­ble diplo­matic coup.

Though cap­i­tal­ism and so­cial­ism make strange bed­fel­lows, Dis­ney’s en­try was not all about diplo­matic ma­noeu­vres only. It is less known that the largest backer of Dis­ney­land is the Com­mu­nist Party it­self— in the shape of Dis­ney’s lo­cal part­ner, state-owned, joint-in­vest­ment hold­ing Shang­hai Shendi Group.

While Dis­ney owns 43% of the re­sort, the Shang­hai Shendi Group, in ad­di­tion to 30% con­trol of the Dis­ney man­age­ment com­pany, takes “57% stake in the Shang­hai re­sort, which in­cludes rev­enue from ho­tels, restau­rants and mer­chan­dise sold on the grounds.” This has been a cut-throat deal as op­posed to Dis­ney’s pres­ence in Hong Kong (2005), which lit­er­ally ca­joled Dis­ney to set up shop.

Third, Pudong, the dragon-head, has spurred a mul­ti­plier ef­fect. Now, Shang­hai Shendi Group has con­cluded a deal with US out­let de­vel­oper Value Re­tail to build an out­let and a seven-star ho­tel, Shang­hai At­lantis re­sort will fol­low.

At Bei­jing, Uni­ver­sal Stu­dios has said that its sixth theme park glob­ally—af­ter Hol­ly­wood and Or­lando in the US, and in Spain, Sin­ga­pore and Tokyo—will be op­er­a­tional by 2019.

Fourth, at the home front, Chi­nese bil­lion­aire and largest com­mer­cial prop­erty de­vel­oper Wang Jian­lin (head of the Dalian Wanda Group which signed a pre­lim­i­nary agree­ment with In­dian au­thor­i­ties to de­velop Wanda In­dus­trial New City in Haryana) has likened Dis­ney to a “lone tiger” against a “pack of wolves”, in­di­cat­ing com­pe­ti­tion at the home turf.

For now, the pack of wolves seem to em­anate from the Wanda sta­ble and should not be un­der­es­ti­mated. A lav­ish ar­ray of theme parks have been set afloat by Wanda in tier-2 cities—such as Wuxi (near Shang­hai), Nan­chang (730-km east of Shang­hai), He­fei (460-km east of Shang­hai), Harbin (2,300-km north of Shang­hai) and Xishuang­banna (2,900-km south of Shang­hai)— which are cen­tred not around Mickey Mouse or even Poke­mon, but el­e­ments of lo­cal Chi­nese eth­nic cul­ture, ge­og­ra­phy or tra­di­tion. Re­port­edly, Xishuang­banna theme park fea­tures ad­ven­tures around the old Tea Road (route) and a jun­gle ad­ven­ture with a rain­for­est theme. In other words, will Wanda give Dis­ney­land a run for its money?

Dis­ney­land in Shang­hai has a sense of “Chi­ne­se­ness”—as it does in Ja­pan with a cer­tain “Ja­pane­se­ness”. But Mickey Mouse has also come with Amer­i­can prices in China—RMB 60 dough­nut, RMB 60 balloon (about R600) and an over­priced ticket. Ten years ago, Dis­ney­land would have been a mo­nop­oly, but what about to­day? Those who have been to the string of mid-range Wanda ho­tels know that it cuts no cor ners and so it is with the Wanda theme parks. In other words, while the eu­pho­ria is pal­pa­ble, Dis­ney­land’s fate in the long run is the big ques­tion.

Last but not the least, be it Mickey Mouse or Wanda’s Tea Road ad­ven­ture, grant it to the Com­mu­nist Party, which has done its math well—an eye on tourism, the bur­geon­ing mid­dle-class and a ride to the bank. With global and China’s slow­down in ex­ports, a thrust to­wards do­mes­tic con­sump­tion, Dis­ney­land (and Wanda parks) all help drive up con­sumer spend­ing. The au­thor is a Sin­ga­pore-based Si­nol­o­gist and ad­junct fel­low at the In­sti­tute of Chi­nese Stud­ies, New Delhi. She is the au­thor of “Find­ing In­dia in China”

Be it Mickey Mouse or Wanda’s Tea Road ad­ven­ture, grant it to the Com­mu­nist Party, which has done its math well, with an eye on tourism, the bur­geon­ing mid­dle-class and a ride to the bank. With global and China’s slow­down in ex­ports, a thrust to­wards do­mes­tic con­sump­tion, Dis­ney­land (and Wanda parks) all help drive up con­sumer spend­ing

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