The rollercoaster ride is over. Fearful of a property bubble and risky spending, the Chinese government has called a halt to the building of new theme parks that would add to the hundreds already operating throughout the country.
The last decade has seen the emergence of new leisure destinations to entertain the 1.3 billion population. Many of the parks have themes such as chocolate, sex, Qing dynasty and movies. But runaway property prices and concerns that local governments have overspent on the 2,500 parks currently in existence have led to a blanket ban on new developments.
The ban applies to theme parks that cover an area of more than 20 hectares or have a total investment of more than 500 million yuan (£47.4m). The ban, which follows the announcement of numerous large enterprises in recent months, could apply to projects already under way.
In June, the Chinese real-estate company Zhonghong signed up the US-based entertainment venue developers Thinkwell to design a £930m theme park based on the Monkey King legend. The previous month, the film group Huayi Brothers signed a deal with a property developer to build a £280m theme park near Shanghai based on its movies. And a £130m Hello Kitty theme park, celebrating the cartoon cat, which has a huge following in China, is due to open in 2014.
The biggest of them all is the Disneyland near Shanghai, which is unlikely to be affected by the National Development and Reform Commission's decision, as permission came directly from the Beijing government. The resort, which will cost £2.6bn to build, is expected to open in five years.
But the ban would bring an end to a booming industry on which £14.2bn has been spent and would dash the hopes of more than 20 cities looking at plans to get in on the act. "I would describe the environment as a gold rush in the Wild East," said Brent Young, principal and chief creative officer of the Los Angeles-based design firm Super 78 Studios. He has worked on a number of theme park projects in China.
The reining in of spending reflects concerns that local governments have stretched their powers to approve the large-scale projects, even though China's cabinet is supposed to be the final arbiter on such schemes.
There are also worries that local governments have become massively indebted since being encouraged to borrow for infrastructure projects under a 2008 stimulus plan. Theme parks have proved attractive to local governments because they provide jobs and revenues. For the developers, the construction of theme parks in China is similar to the growth of golf courses – the activities in the theme park itself are secondary to the spin-offs, such as luxury villas and apartments built nearby.
"The halt of the expansion of theme parks appears to be further evidence of the Chinese government's desire to cool off the market and concerns that the feasibility of some of these developments is questionable," said Mr Young. "Knowing that politics and relationships always play a role in any of these decisions, you can be sure that there are agendas from established park developers to slow growth."
And it's not always about the money. In 2009, the government in the south-western city of Chongqing closed Loveland, China's first sex theme park, because its erotic sculptures were deemed too vulgar.Reuse content