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China bans property sales in upcoming economic zone

08 April 2017

A general view shows a residential area of Pudong district in Shanghai, China April 4, 2017.

Zhang Gaoli made the comments at a conference about integrating the Beijing-Tianjin-Hebei region.

The new area, called Xiongan, is about 100 kilometers from Beijing and Tianjin, rounding up the coordinated development of the Beijing-Tianjin-Hebei region. The country's capital is notorious for its pollution and overpopulation, and the government aims to address those issues with the creation of Xiongan New Area.

China will speed up the drafting of plans for building the new area, said He Lifeng, head of the National Development and Reform Commission (NDRC), highlighting "international standards", "Chinese characteristics", "reform" and "innovation" as key words in making the plan. It houses Baiyangdian, which happens to be among the largest freshwater wetlands in northern China with over 140 lakes that cover an area of 360 square kilometers (139 square miles).

While it remains to be seen whether Xiongan will truly emerge as China's next megacity as the authorities claim, the announcement produced an immediate effect: within 48 hours, tens of thousands of cash-rich and bullish speculators flocked to the tiny county scrambling for local properties in expectation of a huge surge in home prices in the days ahead.

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"This would be one of the centrepieces of a high-level development plan for the Beijing-Tianjin-Hebei region", said Bill Bowler, a sales trader at Forsyth Barr Asia Ltd in Hong Kong.

It is estimated that these newly developed areas are large enough to house as many as 3.4 billion people, or almost half of the world's population. The new area is not deeply developed so the construction of the infrastructure can start at a higher level. The subsidiary center will be in the eastern suburbs of Tongzhou. Industries that don't meet the requirements of the function of the capital will be moved to the Xiong'an New Area.

Beijing Great Wall Electronic Equipment, the company's arm of underwater acoustic communication devices, will relocate from Beijing to the new area.

Chinese policemen have apprehended seven individuals for property violations that occurred within Hebei's Xiongan New Area, which is set to become the nation's newest special economic zone, revealed Reuters, citing a report published by China Daily on Thursday (6 April).

China bans property sales in upcoming economic zone