China New Year's Eve crush: At least 36 killed and 47 injured in Shanghai after 'fake money thrown from balcony of nightclub'

A witness said people had scrambled for coupons that looked like dollar bills that were being thrown out of a third floor window

A friend of a victim covers his face as he waits outside a hospital where injured people of a stampede incident are treated, in Shanghai (REUTERS/Aly Song)

New Year celebrations in Shanghai ended in tragedy last night after 36 people were crushed to death and 47 injured in what has become the city's worst disaster in recent years.

Screams were heard as a stampede broke out on the city's historic waterfront area, causing people to fall and become trampled during the chaotic scramble in which some died of suffocation.

Reports from state media and witnesses have said the stampede was at least partly caused by fake money being thrown down onto the crowds below from the window of a bar on the third floor of a building overlooking the area.

But Shanghai police said on their official microblog that while closed-circuit television footage did show some bills had been thrown from a bar in a building overlooking the Bund, which a small number of people picked up, this did not cause the crush.

"This incident happened after the stampede," police said in a brief statement, without saying what the real cause was.

Crowds of people had already streamed into the Bund waterfront area of the Chinese city before the fake money was hurled out of the bar's window.

The fake money was discovered to be coupons designed to look like dollar bills.

"People were screaming, women were screaming and people started jumping off the staircase to get clear," a Shanghai resident named as Sarah told AFP. "There was a quiet, and then people on the stairs fell in a wave and people started to get trampled."

A man who brought one of the injured to a local hospital said the fake money had been thrown down from the bar as part of New Year' Eve celebrations, which he claims triggered the stampede.

State media reported that witnesses saw the saw fluttering down "like snow".

Cui Tingting, 27, said she picked up some of the bank notes but threw them away when she realised they were fake.

"It's too cruel. People in front of us had already fallen to the floor, and others were stepping all over them," she told Reuters news agency.

Earlier, Shanghai police said they could not confirm the cause of the tragedy and have asked people to be patient, according to state television.

Many of the dead and injured were students, and 28 of the dead were women, state media reported.

People who were unable to contact friends and relatives and were anxious for information streamed into hospitals on Thursday.

A saleswoman in her 20s, who declined to give her name, said she had been celebrating with three friends, one of whom she still has not be able to contact.

Security guards hold a line to keep relatives away from the emergency area in a hospital (EPA)

"I heard people screaming, someone fell, people shouted 'don't rush'," she said. "There were so many people I couldn't stand properly."

Xinhua news agency quoted a woman with the surname of Yin who was caught with her 12-year-old son amid the rush of people pushing to move up and down the steps leading to the square.

She said people that began to fall down "row by row", and that when her son was finally safe, his clothes were covered in shoe prints, "his forehead was bruised, he had two deep creased scars on his neck, and his mouth and nose were bleeding".

The Shanghai government information office said of the 47 people who received hospital treatment, 13 were seriously injured.

Xia Shujie, vice president of Shanghai No. 1 People's hospital, told reporters some of the victims had been suffocated.

One Taiwanese was confirmed among the dead by officials, and two Taiwanese and one Malaysian were among the injured.

People had turned up in their droves despite the planned large scale 3D laser display celebrations having been cancelled a week ago amid safety fears.

The stampede appeared to have taken place close to the area where, according to the Shanghai Daily, a “toned-down” version of the New Year laser display was to have taken place. The show was intended to be for invited guests only rather than for the general public.

A woman grieves in a hospital where some of the injured from the stampede were admitted (EPA)

"It was chaos, and there were only one-third of the number of police there compared with previous years," the Beijing News quoted one Shanghai resident as saying.

Organised New Year celebrations have been taking place in the Bund area for the past three years and in 2013 they attracted almost 300,000 people.

Concerns about the size of the crowds and doubts that police could guarantee their safety led to the authorities cancelling this year’s official public display but thousands of revellers still headed there to celebrate the New Year.

Shanghai's historic Bund riverfront, one of the biggest tourist attractions in the city, runs along an area of often narrow streets amid restored old buildings, shops and other attractions. It runs along the bank of the Huangpu River. The China Daily newspaper in February reported that the city's population was more than 24 million at the end of 2013.

Among the concerns that led to the cancellation of the big public laser display were the number of people crammed into a small area and the difficulties in dispersing them. The laser display was to have been beamed on to the walls of historic buildings for about ten minutes before culminating with midnight fireworks.

People cry at a hospital after a stampede occurred during a New Year's celebration on the Bund, central Shanghai (Reuters)

In its first year the display attracted an estimated 100,000 people but this had tripled by last year, with people crowding in hours before the show started. There were complaints that afterwards it took hours to get people out of the Bund, putting enormous pressure on public transport and leading to taxis hiking fares five-fold.

The tragedy unfolded as Chinese President Xi Jinping gave a New Year address in which he vowed to continue reforms while maintaining the “rule of law”. He compared the twin aims to “a bird's two wings”.

He said there was “no turning back” from the path of reform but said it would only be achieved alongside strong laws designed to protect people's rights and interests, and social justice. By 2020, he said, the policies would ensure China has an “all-round well-off society”.

Additional reporting by agencies