China has become an international capital and laboratory for eco-city projects. The unprecedented scale of rural-to-urban migration is creating pressing demands on existing urban infrastructure, but also the opportunity for city planners to create new cities based on more sustainable, and even ecological patterns of development.
Rising from above the fray of the multitude of eco-city proposals is the Sino-Singapore Tianjin Eco-city project (sketch drawing pictured), which is the first of any of the proposal, as far as The Green Leap Forward knows, to have actually broken ground. This blog first mentioned this project back in February. On September 28, ground was broken and municipal regulations (hereinafter, the “Regulations”) governing the development of the project came into effect. The remarkable speed at which this project moved from concept (in April 2007) to groundbreaking, while other projects which have been planned and talked about for years remain mired in bureaucratic standstill, can be best be explained in the context of Singapore’s long term economic relationship with China. This is not the first time both countries are collaborating on a township-scale development project in China; Suzhou Industrial Park was the first in 1990s and just last month, China and Singapore also entered into a bilateral free trade agreement.
Over the years, Singapore has proved itself to be a reliable and efficient economic partner, and has become an urban development model of sorts for China since the times of Deng Xiaoping’s leadership. Singapore’s proven urban planning successes in public transportation, affordable public housing and water conservation management are commonly cited case-studies in any city planning textbook. The Sino-Singapore Tianjin Eco-city represents a logical opportunity for Singapore to bring its strength in these areas to address the growing urban needs of China, and form the anchor of another economic (and diplomatic) milestone project between both countries. Since the project was first mooted by Singapore’s Senior Minister Goh Chok Tong to Premier Wen Jiabao, it has always received the backing of the highest levels of government of both countries and been on the fast-track.
No wonder it has taken less than a year since Tianjin was selected as the project site last October for the project to break ground.
The Tianjin Eco-city is located within the fast growing economic hub of Tianjin Binhai New Area in the Bohai Rim, some 40 km away from Tianjin city center. The township will be developed in phases over the next 10 to 15 years and upon completion, will span a total area of 30 sq km and be home to some 350,000 residents. The first phase of the project, covering 3 sq km, will be completed by 2013. The choice of city is an interesting story.
Initially there were four candidate sites for the eco-city project–Tianjin; Caofeidian Industrial Park in northern Hebei province’s Tangshan city; Baotou city, an industrial base in Inner Mongolia; and Urumqi, capital city of western Xinjiang province. According to this report, two key considerations factored into formulating this shortlist – that the project should not occupy agricultural land (so as not to compromise food supplies), and that it must be in an area where water is scarce (so as to maximize Singapore’s expertise in water resource management). Referring to the eventual winner, Tianjin, Mr. Goh Chye Boon, CEO of Sino-Singapore Tianjin Eco-City Investment and Development Co., Ltd. (SSTEC), the joint venture company in charge of developing the project, said at the Singapore Energy Conference on November 5:
We chose a piece of land that has totally been devolved of its past nature. Because of many years of salt farming, it is not possible for that piece of land to have trees. That’s why we chose that piece of land…from a low base we can create the future.
More precisely, according to the official English website, the land is “1/3 of saline land, 1/3 of water area and 1/3 of wasteland” and its soil has a high saline-alkaline content, so it is clear that this is not totally a greenfield project. Of course it didn’t hurt Tianjin’s candidacy that it was already a focus of the central government for strategic economic development.
The eco-city’s masterplan can be accessed here in English. It is fairly detailed, and worth the read. Additionally, a list of the projects 26 key performance indicators (KPIs), taken from Singapore government’s website, is reproduced below at the end of this post for the reader’s convenience. Much thought was given in formulating this list. According to the website, “reference is made to national standards in China and Singapore, and the higher of the two standards is adopted wherever feasible. Due consideration is also given to international practices as well as local conditions in Tianjin.”
Corporate Legal Structure and Business Model
Make no mistake about it. This arrangement is motivated as much by international relations reasons and economic reasons as much as environmental cooperation.
The initiative is structured as a for-profit joint venture, SSTEC, the interests in which is split 50-50 between a Singapore consortium called Singapore Tianjin Eco-City Investment Holdings Pte. Ltd. (STEC) and a Chinese consortium called Tianjin Eco-City Investment & Development Co., Ltd (TECID). STEC consists of Singapore’s Keppel Group, now a leading global infrastructure and engineering company, with just over 50% holdings in STEC, and the rest consisiting of international investors, including the Qatar Investment Authority.
TECID consists of Tianjin TEDA Investment Holding Co. (the business arm of the Administrative Commission of Tianjin Economic-Technological Area, or TEDA) as the leading shareholder, with other holders consisting of Tianjin Real Estate Development and Management Group Ltd, Tianjin Tanggu Urban Construction Investment Company, Tianjin Hanbin Investment Co. Ltd and Tsinlien Group (Tianjin) Assets Management Co., Ltd.
The litany of shareholders is presented not to bore readers of this blog, but to make the point that this very much a for-profit venture. “Each of our [upstream ] shareholders and partners are publicly listed, so this needs to be profit-driven,” explained SSTEC’s CEO, Goh Chye Boon to The Green Leap Forward.
It is notable that the Qatar Investment Authority is an indirect investor in the project. Sovereign wealth funds seek long term, stable returns, and the patient nature of such capital is what long term eco-city projects like Tianjin needs. Mr. Goh also pointed out that pensions funds can be strategic investors as well because such funds have mandates or authority to make such long term, strategic investments. This probably includes investments with some sort of social development component.
However, the project also needs to prove that it can provide returns.When queried how, then, could such an intiative, which seeks to carry out and implement a lot of public functions that are usually taken on by a governmental institution, could still make money, Mr. Goh explained that it requires balancing a portfolio of projects that complement longer-term in nature with low payoffs with projects that provide short or medium-term payoffs:
If we build a business park, that’s not going to have any returns for 20 years. But that’s okay, we do that as a matter of corporate social responsibility. But at the same time, we engage in projects with shorter term returns [such as real estate development]…What we do is that we put back these profits into our longer term projects.
A Holistic Urban Development Approach
The Green Leap Forward will go on the record in saying that it is suitably impressed by the holistic thinking behind the eco-city’s master plan. The environmental and energy KPIs are extremely rigorous. Citing one of the most ambitious KPIs of the project–the proportion of green trips (i.e. mass transit, cycling or walking) used in the city at 90% by 2020, Mr. Goh said:
Even in an efficient city like Singapore, we are struggling to achieve 70%. This is not easy…but I think without such targets, we will not be able to design a green city well. As a result, we are putting in place the appropriate road structure, we are designing very good public transport systems. All these investments make sense…These are KPIs that will stretch our imagination, stretch my team and make us work very long hours.
But Mr. Goh urges planners to look beyond the KPIs themselves:
If you look at the twenty or so [proposed] eco-cities around the world, [the KPIs] are more or less the same. There is no need to compare the KPIs…I’m not here just to be green…At the heart of what we are trying to do is to create a better life. It’s not about building sexy, iconic buildings. If that’s the case it would be easy…[Rather,] it is about building not so sexy, but green buildings, [and looking at] how people live inside them. It’s about [creating an] eco-lifestyle.
Thus, the mater plan is not just about laying out the energy and water efficient infrastructure, but creating an attitudinal framework for low carbon living while respecting existing social relationships and culture. Thus, Article 32 of the Regulations talks about the establishment of high-quality education and training resources geared towards community development (“ 生态城积极引进国内外优质教育和培训资源，建立与社区发展相适应的教育体系和教育网络。”). Additionally, Mr Goh emphasized more than once the important of listening to the residents and understanding where they are coming from. Thus, of the 26 kep performance indicators (KPIs) that have been set to assess the progress of the project, a handful touch social issues directly (e.g. barrier-free access, affordable housing for low-income residents, employement levels and preservation of estuarine cultural heritage).
The Regulations themselves contain important clauses pertaining to social and community development. One that stands out, Article 34,speaks of “establishing and improving mechanisms for democratic participation”, “self-management by community residents” and “promotion of community service” (“… 建立健全民主参与机制，实现社区居民自治管理，积极推进社区服务与物业管理有机结合的新模式。”), remarkably progressive concepts when one considers the not too distant political history of China.
Truly then, the TIanjin Eco-City project takes very much to heart social innovation and development, in addition to just the eco-technological. Related to social development is the importance of building a sustainable economic base for the city so as to provide true-value employment. The muinicipality of Tianjin is already being groomed as an emerging economic metropolis of China, with emphasis on high-tech manufacturing and financial services. Already, a number of notable multinational coporations have a presence in Tianjin , particularly wind turbine manufacturers such as Vestas and Siemens. Just a day before the groundbreaking, the Tianjin Climate Exchange was launched quite nearby the project area.
In the Regulations, Article 15 alludes to the establishment of eco-industrial/investment programs (“生态城管委会对符合生态城产业发展目录和有利于增强自主创新能力的投资项目，制定相关办法给予优惠支持。”). Article 7 is more specific, describing the development of a local circular economy centered around energy conservation, sustainable real estate, R&D, services, finance, logistics, tourism, etc. (“生态城重点发展符合节能环保、循环经济要求的房地产、科技研发、服务外包、物流、创意、金融、商贸、会展、旅游等产业”). As a promotional brochure of the Tianjin project boasts, the eco-city ill be “an incubator for the latest eco-technological innovation, a greenhouse for cutting-edge eco-ideas, a hub for world-class financial, education and healtcare services; a node for international forums and exhibitions; and a playground for exciting eco-tourism, recreation and wellness activities.”
Indeed, the project adopts a people-first approach. Said Singapore minister Mah Bow Tan at the groundbreaking:
The Tianjin Eco-city is underpinned by the principle of the “three harmonies”, namely, harmony between man and man, man and the economy, and man and the environment. The balanced emphasis on social harmony, environmental protection and economic vibrancy will make the Tianjin Eco-city a unique model of sustainable development.
SSTEC will certainly have its hands full over the next few years. But after that, then what?
“We are going to make profits out of this, no doubt. Why do we want to make profits? Because if we don’t, how are we going to sustain our good work?” said Mr. Goh. When asked by The Green Leap Forward if this meant there were plans to get involved in other eco-city projects, Mr. Goh answered in the affirmative, saying that they would be happy to get involved in projects as a minority stakeholder or advisory capacity and not necessarily as the lead developer. The experience that SSTEC gain over the next decade or so in Tianjin will certainly be valuable, and worth sharing to other new town developments.
If SSTEC decides to “do its good work” in other sites in China, or beyond, it might consider a corproate name change.
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UPDATE (Nov 21): Serendipitously, GLF got invited to go visit the actual site of the proposed eco-city in Tianjin.
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The following Key Performance Indicators (KPIs) have been selected for the Sino-Singapore Tianjin Eco-city:
1. Ambient Air Quality: The air quality in the Eco-city should meet at least China’s National Ambient Air Quality Grade II Standard for at least 310 days. The SO2 and NOX content in the ambient air should not exceed the limits stipulated for China’s National Ambient Air Quality Grade 1 standard for at least 155 days.
2. Quality of water bodies within the Eco-city: Water bodies in the Eco-city should meet Grade IV of China’s latest national standards by 2020.
3. Quality of Water from Taps: Water from all taps should be potable.
4. Noise Pollution Levels: Noise levels must fully comply with China’s standards for environmental noise in urban areas.
5. Carbon Emission Per Unit GDP
Description: The carbon emission per unit GDP in the Eco-city should not exceed 150 tonne-C per US$1 million.
6. Net Loss of Natural Wetlands: There should be no net loss of natural wetlands in the Eco-city.
8. Native Vegetation Index: At least 70% of the plant varieties in the Eco-city should be native plants/vegetation.
9. Per Capita Public Green Space: The public green space should be at least 12 square metres per person by 2013.
(iii) Good Lifestyle Habits
10. Per Capita Daily Water Consumption: The daily water consumption per day each person should not exceed 120 litres by 2013.
11. Per Capita Daily Domestic Waste Generation: The amount of domestic waste generated by each person should not exceed 0.8 kg by 2013
12. Proportion of Green Trips: At least 90% of trips within the Eco-city should be in the form of green trips by 2020. Green trips refer to non-motorised transport, i.e. cycling and walking, as well as trips on public transport.
13. Overall Recycling Rate: At least 60% of total waste should be recycled by 2013.
14. Access to Free Recreational and Sports Amenities: All residential areas in the Eco-city should have access to free recreational and sports amenities within a walking distance of 500m by 2013.
15. Waste Treatment: All hazardous and domestic waste in the Eco-city should be rendered non-toxic through treatment.
16: Barrier-Free Accessibility: The Eco-city should have 100% barrier-free access.
17. Services Network Coverage: The entire Eco-city will have access to key infrastructure services, such as recycled water, gas, broadband, electricity and heating by 2013.
18. Proportion of Affordable Public Housing: At least 20% of housing in the Eco-city will be in the form of subsidised public housing by 2013.
(iv) Developing a Dynamic and Efficient Economy
19. Usage of Renewable Energy: The proportion of energy utilized in the Eco-city which will be in the form of renewable energy, such as solar and geothermal energy, should be at least 15% by 2020.
20. Usage of Water from Non-Traditional Sources: At least 50% of the Eco-city’s water supply will be from non-traditional sources such as desalination and recycled water by 2020.
21. Proportion of R&D Scientists and Engineers in the Eco-city Workforce
Description: There should be at least 50 R&D scientists and engineers per 10,000 workforce in the Eco-city by 2020.
22. Employment-Housing Equilibrium Index: At least 50% of the employable residents in the Eco-city should be employed in the Eco-city by 2013.
24. Adopt innovative policies that will promote regional collaboration and improve the environment of the surrounding regions.
25. Give prominence to the river estuarine culture to preserve history and cultural heritage, and manifest its uniqueness.
26. Complement the development of recycling industries and promote the orderly development of the surrounding regions.