Xining City Guide: Rising to a historic challenge

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Xining has a historic opportunity to raise its profile and become a hub city with the creation of the New Silk Road under China’s visionary ‘One Belt, One Road’ policy. Mayor Zhang Xiaorong tells Euromoney how the city is rising to the challenge.

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Mayor Zhang Xiaorong is a man who feels the hand of history on his shoulder. A native of Qinghai province, he has taken office at a time when Xining has an unparalleled opportunity to raise its profile and become one of China’s key cities.

As he outlines his vision for the future of his city, Zhang speaks with awe and excitement at the size of the task ahead to ensure that Xining rises to the challenge. "In the 30 years since the opening up of China, much of the development has been in the east of the country," he says in an interview with Euromoney in the city’s atmospheric Qinghai Hotel. "Cities along the coast have developed very quickly and people’s lives have been improved immeasurably. Our city stands at a very important point strategically in the Silk Road. It is a hub of the eastern cities along the Silk Road, so in the future we have to make sure that we are ready to play the role of a hub.

"We have to accelerate the development of logistics and the concentration of human resources and green finance and new materials in our city. Xining has a very big role to play in the future development of culture and commerce along the Silk Road."

The crackle and energy of Zhang’s rhetoric mirrors the frenetic buzz of the city around him. There is a fierce urgency and a sense of restless purpose in every quarter as new highways, new power networks and new buildings take shape at an extraordinary pace. The hum of building work continues night and day. This is a city waking up to a new economic reality and a new world of opportunity that most of its citizens and businesses have not yet fully grasped.

Global connections

Zhang, who took office in May, bubbles with enthusiasm as he shows the map of high-speed railways that pass through Xining. The lines, extending thousands of miles in all directions, make Xining a key node city in the vast area known as the Silk Road Economic Belt.

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The most important connection along the New Silk Road, says Zhang, is the Lanzhou-Urumqi express railway – the longest railway in northwest China running nearly 2,000km from Gansu province to Urumqi in Xinjiang and passing through Xining.

The half-century-old line has been upgraded to a high-speed line, meaning it now takes only 10 hours to travel from Xining to Urumqi – a connection that opens up a wealth of opportunity for trade with neighbouring Central Asia. Simultaneously, a Xining-Golmud-Korla railway connecting China to Pakistan is now under construction, These two railways not only complement the existing rail network of Xining, but bring historical opportunities for resource integration and common development with Central Asia in this process of accelerated opening up.

Another key link in the New Silk Road is the Qinghai to Lhasa line which opened in 2006 to great fanfare as the world’s highest railway line, climbing to 5,072 metres above sea level as it crosses the Tibetan Plateau. That spectacular line has already been extended to Shigatse in Tibet and, if extended to Nepal in future, will open the door to huge commercial possibilities through the collaborative development of Xining and southern Asia.

Meanwhile, high-speed railways linking Xining to Chengdu and Xining to Kunming among other lines are being planned – all of which will reinforce Xining as the key strategic city in China in connecting the country to western, central and southern Asia.

As well as its rail links, highways throughout western China to Xining are being upgraded and built to improve connections with the rest of the country and westwards to the borders of Central Asia.

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Xining’s international airport is meanwhile becoming an increasingly important hub for the region, the mayor said. It handles some 8 million passengers and 24,000 tonnes of cargo a year with 57 domestic and overseas routes. There are direct flights to every major city in China except Lanzhou and direct flights to Bangkok, Seoul and Tapei.

By the end of 2015, there will be direct flights to Hong Kong and there are plans for further direct flights to Istanbul in Turkey and Bishkek in the strategically important neighbouring country of Kyrgyzstan.

Zhang believes that as well as a transport hub, Xining will again become a hub of commerce on the Silk Road. "We will trade goods here from other cities and areas near Xining and these links mean that the distance to central and southern Asia is less," he says.

Infrastructure is only part of the recipe, however. Having the right environment and the right cultural mix are also factors that Zhang believes will be essential to Xining’s future prosperity.

"It will be convenient and easy for businesses to reach these markets through Xining. We also have the advantage of climate, because the climate in Xining is very similar to that of south Asia," he says. "Furthermore, we have mosques and the Islamic faith and so much halal food."