It’s been over a month since the Expo has ended, effectively shutting its doors to the biggest single event in Shanghai’s history. And while constant Expo commercials may no longer play in the subway, and illegal ticket hawkers may not swarm if you find yourself within a fifty meter radius of the Expo gates, there are lasting effects of this cultural and economic phenomenon that will not so easily fade away.

Photo: dfdaily.com

Money talk

Much was made in the years and months leading up to the Expo over the amount of money Shanghai was spending to clean up the city and make it “Expo worthy.” An official Expo budget was set at $42 billion USD for preparation, with about $586 million of that going towards the construction of the three kilometer tunnel under the Huangpu River alone. Even multi-billion dollar budgets can prove inadequate, however, and the China Economic Daily reported that the actual amount spent by the government hovers more around the $58 billion mark once the cost of all the new metro lines, airport terminals, and other city improvements are included.

Many people wondered how Shanghai could ever make a profit after such exorbitant spending and if such a large investment was a wise use of money, considering other parts of the country could have more directly profited from the funding. If official government numbers are to be believed, the Expo actually generated about 12 billion USD in ticket sales and tourism, for both Shanghai and its surrounding cities. This may just be a fraction of the cost Shanghai spent on Expo preparation, but it is important to remember that short term profits were not the ultimate goal to begin with.

Improvements and benefits

Instead, the infrastructure improvements will benefit the city long term by establishing more economically and environmentally friendly practices. For example, the solar panel on the roof of the Chinese Pavilion is officially the largest in the world at 30,000 square meters. This pavilion, the newly built performing arts center, and all the Expo zones use LED lighting for more electrical efficiency. And in what can be called the Great Taxi Expansion of 2010, Shanghai has introduced more than 1,000 “renewable energy” cars, with more expected in the near future. With all these long term benefits for the city, it is not surprising that experts estimate the Expo’s overall economic advantage as three and a half times what Beijing experienced for the Olympics.

Unofficial numbers show the travel, retail, wholesale, and tourism businesses seeing about a twenty percent increase this year due to the Expo. I would expect that percentage to increase once official numbers come out. In addition to increasing the business already here, the Expo brought new foreign companies to the city, including twenty foreign-invested projects estimated at a value of over $1.2 billion USD. As these businesses find success in Shanghai, other foreign businesses are bound to follow and the city’s residual gain from the Expo will continue to grow for many years.

With the Shanghai Expo going down in history as the largest Expo thus far (according to CRI, its estimated 70.7 million visitors beat out Osaka’s 1970 Expo by over 13 million), there is little doubt in people’s minds that the event was a success. Its infrastructure improvements will certainly help the city in the long-term, and the success of the actual Expo has fueled much national pride in the hearts of Chinese citizens.

There have been clear downsides, though, including a continual increase in apartment rental costs. Of course, this can be seen as positive for property owners such as Mr. Fen, who says the Expo “has allowed landlords to acquire about 10% more per month for rent. The Expo has been good.” The cost of traveling to and from China has also gone up around 30%, an increase that is unlikely to go back down any time soon.

Expo and the international community

When it comes to the Expo’s overall impact on the international community, the event’s effects don’t seem to reach quite so globally. One of the larger international issues stemmed from the government’s forced relocation of over 18,000 families from their homes in order to clear the grounds for the Expo, rather than the Expo itself. Overseas visitors accounted for less than 6% of the total number, meaning most visitors came from other parts of China. This reflects both the heavy marketing the government did throughout the country, as well as the free tickets and “Expo days” they gave employees to boost attendance. In other parts of the world, however, the Expo was largely overlooked and expats living in Shanghai were mostly ambivalent towards the event. Those expats living in Shanghai short term will mostly remember the government’s cracking down on practices such as selling illegal DVD’s (which simply forced DVD sellers to put up fake walls in their stores and sell the DVD’s behind this flimsy partition) and wearing pajamas in public – all of which were promptly reinstated once October 31st came and went. Long term expats, however, are much more likely to see the residual benefits of the Expo.

Ultimately, the Expo was successful in greatly improving the infrastructure of Shanghai as a city, and inspiring the citizens of China as a country. As Premier Wen sums up, "The success of the Expo has strengthened China's confidence and resolve to pursue reform and opening up.” And really, isn’t that the most important thing?

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