Spotlight on Beijing

Robert Hsu, February 01, 2008

Since we'll be hearing a lot about Beijing in the coming months as the Summer Games approach, I want to take an in-depth look at the city. Beijing is an interesting place full of history and culture.

Even though it's the capital of China, Beijing isn't the biggest city in the country -- that distinction actually belongs to Shanghai. With a population of 16 million people, Beijing is China's second-largest city. It first gained prominence as the capital of China under Mongolian conqueror Kublai Khan in the 13th century. But it wasn't until 1420 that Beijing officially became the seat of central government upon the completion of the gigantic emperor's palace, better known as the Forbidden City. Nowadays, Beijing is organized in a series of concentric circles known as rings, with the Forbidden City at its center.

Beijing is a quiet city compared with other major Chinese hot spots like Shanghai and Shenzhen. The government's stifling dominance and desire for control make the city less vibrant than other Chinese metropolises. As the capital city, Beijing is considered so significant that all clocks in China are set to Beijing time. Although China is roughly the size of the United States, it only has one time zone.

Most first-time visitors to Beijing go there to see ancient landmarks like the Great Wall, Forbidden City and Temple of Heaven. To the average tourist, Beijing is heavily polluted, unpleasant and difficult to navigate. (Because of its proximity to the Gobi Desert, the city has had water-shortage problems and dust storms for many years.) But what the city lacks in charm, it makes up for in age-old grandeur.

For those who are culturally inclined, Beijing offers the most exciting contemporary art scene in Asia as well as a degree of Chinese cultural sophistication found nowhere else in the country. In addition, resourceful visitors who know their way around the city can find some of the best goods and services that China has to offer.

Beijing is proud of its ancient heritage. Unlike its upstart rival Shanghai, which was built in the past 150 years, Beijing is steeped in history and Chinese cultural sophistication. Some people believe that the city is set in its ways and that its traditions hinder progress, but I always enjoy chatting with intelligent Beijing natives about subjects like Taoism philosophy and Qigong, an aspect of traditional Chinese medicine. The two finest institutions of higher learning in China -- Tsinghua University and Beijing University -- are both located in Beijing. The abundance of intellectual talent is why Beijing has become a hotbed for knowledge-based businesses like New Oriental Education (NYSE: EDU) and Internet search engine giant Baidu.

But for many reasons, Shanghai is still considered livelier and more happening than Beijing. It's the most cosmopolitan city in China and the center of private businesses. Shanghai also has the most Western influence of all China's cities, and the people there tend to be friendlier to Westerners. From an economic standpoint, there are more young middle-class professionals in Shanghai than in any other city in China. And on my many trips to China, I've noticed that the average person from Shanghai is more worldly-wise than the average person from Beijing.

The Chinese government hopes that the 2008 Olympics will help Beijing become a more hip and cosmopolitan city without losing its distinctly Chinese character. Although the Olympic Games probably won't solve all of Beijing's problems overnight, they will significantly increase the city's profile and help residents improve Beijing's stodgy image.

Are you interested in tracking China's progress and taking advantage of profitable investment opportunities as the country prepares for the 2008 Summer Olympics? Visit China Strategy today!