Disneyland Park Expected to Drive Shanghai Financial Sector

The upcoming Disneyland Park in Shanghai is expected to drive local financial industry.

Sources said that Shanghai Disneyland Park is to be located in economically developed Pudong New Area. With the first phase covering total areas of 150 hectares, the park will come into use in 2014 at the earliest. According to the announcement of Walt Disney Company released this January, it is to build the Disneyland Park in partnership with People's Government of Shanghai Municipality with total cost estimated at CNY 24.5 billion. Reports said that the government-controlled enterprises in Shanghai are to take a combined 57% stake in the upcoming park and Walt Disney Company is to hold a 43% stake.

Earlier, the listed company Shanghai Lujiazui Finance & Trade Zone Development Co., Ltd. (Lujiazui, 600663.SH) was said take a 30% stake in the coming Disneyland Park. In addition, domestic banks of China are likely to offer syndicated loans to the Disneyland Park, according to a general manager with a local investment consulting firm.

Industry experts believed that once the Shanghai Disneyland Park operates well, it will be a driving force for local economic development. This can be reflected in the future benefits for the supportive commercial facilities, transportations and communications, hotels and restaurants, as well as such sectors as retail, real estate and infrastructure construction. In addition, the international recognition of Shanghai can also be further enhanced.

In addition to the Disneyland Park, Lujiazui Financial City is another big project in Shanghai, merely 10 kilometers away from the coming Disneyland Park. Both the Financial City and Disneyland Park are expected to be two major driving forces for Shanghai's local economic development. Therefore, the land development, tourism, consumption goods, construction, media and broadcasting-related stocks will see performance growth by then.

Currently, the business scope of Walt Disney Company covers four areas: theme parks and amusement parks, film-making, media and other consumer products. As early as 2005, Hong Kong Disneyland Resort had started operation. It was The Walt Disney Company's second subject park in Asia and the fifth in the whole world. With an investment of HKD 22.45 billion, Hong Kong SAR Government controls a 57% stake in Hong Kong Disneyland. In the coming 40 years, the Disneyland Resort is expected to bring revenues of HKD 80 billion to HKD 148 billion to Hong Kong SAR, with the return on capital as high as 25%.

(USD 1 = CNY 6.83)

Source: www.cnstock.com (September 10, 2009)

Related terms: asia, broadcasting, china, commercial, communications, construction, consulting, consumer products, film, finance, government, hong kong, investment, local, media, partnership, real estate, restaurants, retail, shanghai, trade, SinoCast China Business Daily news, SinoCast China Financial Watch, Disneyland Park, bank, stock, stake