Entrepreneurship not speculation key for new area success

On Saturday, the central government announced its plan to create Xiongan New Area in North China's Hebei province, as part of its measures to push "inclusive development" of the Beijing-Tianjin-Hebei region in a coordinated manner.

The move is expected to have a significant bearing on the country's future development, and many people have drawn parallels with the Shenzhen Special Economic Zone and Shanghai's Pudong New Area, the country's two most important economic hubs that have spearheaded the prosperity of the Pearl River Delta and the Yangtze River Delta, and which are deemed to have been successful test beds and drivers for the country's reform and opening-up initiative.

What is worrying, however, is that even before a concrete development blueprint for the new area has been revealed, a large number of investors, from within Hebei and beyond, have swarmed into the region, which includes three counties in Hebei that are about 100 kilometers south of Beijing, to buy flats in anticipation of profiting from rising property prices. As a result, the prices of apartments in these counties have reportedly doubled, even tripled, in just three days after the plan for the new area was announced.