The world’s largest shopping mall boasts some impressive statistics:
7.1 million square feet (659,612 square meters) of leasable
space and 890,000 square meters of total floor space; attractions,
including a roller coaster and a Venice-like canal; and over 1,500
shops, with an occupancy rate of 0.8%. That’s right.
Although it opened in 2005, 99.2% of the shops are empty.
Since its opening in 2005, it has suffered from a
severe lack of occupants. Much of the retail space remained empty in
2008, with 99.2 percent of the stores vacant…The only occupied areas
are near the entrance where several Western fast food chains are
located and a parking structure repurposed as a kart racing track.
The planned Shangri-La Hotel has not been constructed…
The New South China Mall was featured on the PBS show, POV: Utopia,
Part 3: The
World’s Largest Shopping Mall…
But the Chinese have imported yet another concept
familiar to Americans — South China Mall is considered too big to fail.
So, employees line up for flag-raising ceremonies and pep talks about
“brand building” before going off to maintain the deserted concourses
meticulously. If China is the future of the world economy, Utopia, Part
3: The World’s Largest Shopping Mall just may be a startling peek at
what’s to come.
This is a good point. The skeleton picture fits in with a
Halloween theme. But this is not about the fantasy world of
Halloween, it is about the real world we live in today.
The point made in the blurb from PBS, “If China is the future of the
world economy, Utopia, Part
3: The World’s Largest Shopping Mall just may be a startling
what’s to come, is salient. We were counting on “decoupling,”
that is, the ability of emerging economies to stay relatively strong,
in the face of economic problems in the developed world. The
idea was that if the US consumers faltered, the Chinese (and Russian,
Indian, and Brazilian) consumers would continue to provide demand for
goods and services.
Consumers in the US are not going to fix the economy, and the empty
mall in China indicates that the consumers in the developing world
aren’t, either. I know, a single failed commercial real
estate development is not proof. But there’s more: from
Myth of Chinese Decoupling, and from Market Oracle: The
China Growth Myth Debunked, What Happens When the Credit Bubble Pops?
For decades, the US has been waging a war against its own middle class.
Meanwhile, China has been battling to expand its middle
class. Unfortunately, it is easier to destroy things than to
build them, and if there is one thing the US is really good at, it is
good at destroying things.
Some companies in the US have been showing profits lately, but for
many, this has come not from selling more stuff, but from reducing
costs. That is, laying people off. This increases
profit in the short term, but it the long term, it means less fewer
paying customers. It is a reasonable strategy if the crisis
passes quickly, but this crisis is not passing quickly. It is