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Beijing versus Shanghai

If you want a means for understanding some of the flow of Europe’s social and economic history, one way of doing it is to map its wealthiest cities through the epochs.

Broadly speaking, you can draw an arc westwards from the continent’s southern and eastern fringes, as its richest city moved through the centuries from the Mediterranean to the Atlantic seaboard (to name six of the most significant: Athens, Rome, Constantinople, Florence, Amsterdam and London).

A similar exercise might be undertaken for China, demonstrating how its richest city has moved from north to south over the last thousand years.

Economic historians report that it has been almost a millennium since a city in the north of the country was China’s richest. After the fall of Kaifeng in 1127 the Song Dynasty relocated its capital to what is today’s Hangzhou – in an area most Chinese consider to be part of the southern half of the country (northern China is usually defined as the territory above the Qin Mountains and the Huai River – Kaifeng is hundreds of kilometres north of this geographical line in Henan province).

This north-south divide is important in grasping the course of Chinese history. All the successful conquests (including the defeat of the Song empire by the Mongols) began from the north, because these invading armies were more motivated to storm southwards from harsher steppe climates towards warmer and more affluent cities. Northern strongholds were less likely to be unseated by revolts from the south, however. These strategic calculations help to explain why Beijing was designated as capital for nearly 800 years: its northerly location preferred by the triumphant Mongols (Yuan Dynasty) and later by the Qing emperors (ethnic Manchus who also invaded from the north).

Yet in the same periods the richest cities were in the lusher and more economically vibrant south. Despite sitting at the centre of China’s political power structure – and hosting an important cluster of state-owned enterprises and top universities since 1949 – Beijing’s economy trailed that of the south’s dominant city for decades, amounting to just 40% of Shanghai’s GDP by 1978. However, the so-called ‘capital economy’ has been catching up in recent years. So much so that economists expect China’s political centre could soon displace Shanghai as the country’s leading urban economy – which, given the context above, is a historically significant once-in-a-millennium shift.


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