For the once booming central hub city of China, it looks like the honeymoon is over – for the time being.
Chongqing is regularly described as the largest city in the world. The municipality is effectively a province of its own, one of three such municipalities in the country, and home to anything from 35 to 45 million people.
In the past few years, Beijing has ramped up its Go West programme aimed at boosting development in the inland provinces and shifting manufacturing inland and away from the coastal areas that have the highest per capita wealth.
The municipality of Chongqing constructed enormous economic zones, free trade areas and bonded facilities. It build roads and expanded airport cargo handling facilities and created large container terminals on the banks of the Yangtze River.
The gates were opened and foreign multinationals poured in. Almost every major automaker and electronics manufacturer has production facilities in Chongqing and nearby Chengdu.
Such was the development that the city’s import and export volume grew by almost 95 percent over the last three years. It prompted stunning forecasts for this year, mostly in the electronics sector that officials said would produce 20 million monitors, 30 million printers and 50 million computer notebooks before the clock ticked over to 2013.
Except it turned out that China was not immune from the global financial crisis. No matter how much it threw into stimulus packages, with such an export-focused economy there was no way imports could ever offset the fall in exports.
It took transport and logistics providers by surprise. Their forecasts for 2012 have are wildly inaccurate, with one huge German forwarder admitting to overestimating the volume by 25 percent.
Air freight is being hurt the most, but containerized exports from Chongqing that travel down the Yangtze River to the Shanghai hub have also slowed. The orders from overseas have simply dried up and factory output has slowed.
It is inevitable Chongqing will assume the mantle of manufacturing hub of central China, but it seems reaching the point where significant and sustained volumes of freight are produced will take a little longer than everyone thought.