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From Site Selection magazine, September 1999 P H Y S I C A L I N F R A S T R U C T U R E G I A N T S 'Billion Dollar Babies' Reshape the Location Landscape
From China’s $28 billion Three Gorges Dam to
In fact, much of this SS issue is a veritable hymn to how information infrastructure has dramatically altered where, when and how we work, transforming a 9-to-5 workplace that was as tightly defined as the facility walls that confined it. Instead, we now work anytime/anywhere/anyplace. Simultaneously unfolding, though, are a series of old-fashioned but hugely influential physical infrastructure projects with equally awesome transformational powers. Physical infrastructure, of course, remains a critical business location element. That’s obvious in this issue’s listing of some of the world’s major projects (see pg. 819), which will substantially increase the surrounding areas’ site selection potential. Today’s biggest infrastructure projects, however, are something else again. Opening up vast land tracts and billion-dollar markets, they hold the potential to forever alter the location equation. China’s Dam Controversy Matching that potential are dizzying capital expenditures. Consider the US$28 billion price tag on the yawning Three Gorges Dam project in China, designed to generate one-ninth of the power supply needs inside that sprawling giant. Scheduled for completion in 2009, the dam marks only the second time in history that the Chinese have diverted the mighty Yangtze, the world’s third- longest river. With its crew of 18,000, the project will create a reservoir a mile and a half (2.4 km.) wide and 370 miles (592 km.) long. A firestorm of controversy, however, matches the dam’s scale. Immense size virtually guarantees debate. But the world’s largest hydroelectric project has pushed the controversy quotient to tidal-wave levels. Environmentalists uniformly vilify Three Gorges as an unmitigated disaster that will dramatically increase pollution, flood valuable archaeological sites, wipe out endangered species and destroy some 250 Chinese cities. Not to mention the jarring relocation of up to 1.9 million Chinese, most poor and uneducated. The dam should be halted, says Owen Lammers, executive director of the International Rivers Network (www.irn.org), an environmentalists’ coalition. It will only strengthen Chinese hard-liners and keep all enterprises state-owned. Three Gorges, however, looks like an environmental Tiananmen Square. Controversy won’t likely stop China’s relentless economic evolution, most observers agree. In fact, many Chinese officials proudly regard the dam as the modern-day equivalent of the Great Wall. Libya Builds a River Similarly great expectations (and lower-voltage controversy) are riding on Libya’s Great Man-Made River. At peak capacity, it will daily carry some 175 cubic feet (5 million cubic meters) of water, aerating the barren northern Sahara Desert, one of the world’s final wildernesses. That could create huge development opportunities for Libya, with which the UK recently resumed diplomatic relations after a 15-year hiatus. (The USA is also considering removing Libya from its terrorist nations list.) The four-phase river, however, faces more long gaps. Though now partially operative, history’s biggest water transport project won’t be completed until 2010. Malaysia’s High-Tech Corridor A more high-tech mega-infrastructure project is unfolding courtesy of Malaysian Prime Minister Mahathir Mohamad, whose lofty national aspirations drove the creation of the world’s tallest building, Petronas Twin Towers. Now the prime minister says he wants to create the Asian Silicon Valley -- the Multimedia Super Corridor (MSC), a nine-mile (14.4-km.) wide greenfield area stretching 30 miles (48 km.) south from Kuala Lumpur City Centre (home to Petronas Towers) to Kuala Lumpur International Airport. The MSC project (www.mdc.com) underscores the interplay of physical and information infrastructure in high-end facility locations. One linchpin strategy, for example, would create two "smart cities." Putrajaya would become Malaysia’s governmental capital, housing 250,000 people. Joining Putrajaya near the MSC’s southern tip would be the more business-centric Cyberjaya (meaning Cybercity), designed to nurture software design and development, electronic publishing, film production, and Internet service providers. Putrajaya’s other "precincts" would include shopping and support services and a residential area for 100,000 people. The MSC’s communal glue would be its electronic backbone, a digital fiber- optic network linked to the United States, Japan and Europe. The MSC’s potential (plus its lucrative incentives) have triggered substantial corporate interest. Major firms that have either invested or plan to invest in the MSC include AT&T, British Telecom, Intel, Motorola, NCR, Nippon Telegraph and Telephone, Rockwell Automation, Sharp, Siemens, Sun Microsystems and Sumitomo. Similarly, the MSC international advisory panel includes high-tech luminaries like Microsoft Chairman Bill Gates and Sun Microsystems Chairman Scott McNealy. Even Big Boys Get a Bruise By their nature, though, jumbo-size infrastructure projects often teeter precariously. Such has been the case with the MSC. The ringgit’s collapse triggered the nation’s first recession in 13 years, drying up seed capital and spurring the almost two-year delay for the liftoff of MESDAQ, a Malaysian stock market for new technologies modeled after the U.S.-based NASDAQ. Mahathir then further spooked business by introducing capital controls pegging the ringgit to the U.S. dollar, which stopped investor profit repatriation for a year and limited short-term capital inflows. Finally, late last year Mahathir sacked and arrested a political rival, Deputy Prime Minister and Finance Minister Anwar Ibrahim. With that, author and futurist Alvin Toffler, an influential MSC advisory panel member, broke ranks and blasted the prime minister. "I do not believe this visionary project . . . can flourish in the present climate of political repression," Toffler said. "Can anyone imagine [creating] Silicon Valley with political repression?" Obviously, the MSC is a project to watch in more ways than one. ‘Big Dig,’ Big Payoff But not all of today’s most significant projects are aimed at opening up virgin business location turf. Many are unfolding in established business hotspots where success has sired king-size problems.
One such project is Boston’s $11 billion Big Dig (www.bigdig.com), an ambitious 11-year plan attacking choking traffic gridlock, a problem as American as mom, apple pie and free-floating firearms. Boston’s gridlock is most acute at the six-lane elevated highway linking downtown and the waterfront. Designed in the ‘50s to handle 75,000 cars a day, it’s daily crammed with 190,000. The multi-faceted design includes adding a second tunnel under Boston Harbor to Logan International Airport, plus replacing the outmoded six-lane with an underground eight-lane that can carry 245,000 cars. The Dig will cut rush hour by two hours, officials estimate. Above right: Boston's massive "Big Dig" is excavating 13 million cubic yards of dirt, enough to fill Foxboro Stadium, the New England Patriots' 61000-seat home to the rim 13 times. Big Initial Opposition Early on, though, critical slings and arrows besieged the Big Dig. The Project On Government Oversight, a federal government watchdog group, slammed it as "a renegade project" in a stinging 1995 report, "No Light at the End of This Tunnel." Now, though, the Dig is widely regarded as a model for restoring aging urban highways and strangled downtowns -- in short, a case study in big-project survival skills. The Big Dig’s redemption rested in mollifying local activists and minimizing disruption -- no mean feat when you’re excavating 13 million cubic yards (16.9 million cubic m.) of dirt, enough to fill to the rim, 13 times, Foxboro Stadium, the 61,000-seat home of pro football’s New England Patriots. But project directors hired on-site noise technicians, repeatedly showered dirt- carrying trucks and retrofitted equipment to limit pollution. Expecting a critical earful, Big Dig officials also offered a disarmingly willing ear. They funded many activists’ pet projects, ranging from a Holocaust monument to ginkgo trees in Chinatown. And funding additional rail and water ferry service for downtown-suburbia commutes prompted environmentalists to drop their court challenge. But that accommodating style has been pricey. Add-ons account for one- third of the project’s total cost. Business, however, has embraced the smart-growth strategy. Says Massachusetts Turnpike Authority Chairman James Kerasiotes, who’s overseeing the Big Dig, We’re seeing a downtown development explosion, and we haven’t even finished. By 2000, says Boston Chief Economic Officer Thomas O’Brien, 4 million sq. ft. (371,612 sq. m.) of office space, 1,600 new hotel rooms and 2,000 housing units will be built or under way. The Big Dig, says Brookings Institution urban planning analyst Bruce Katz, has positioned Boston to be the 21st century’s jewel of American cities. Clearly, physical infrastructure retains its potent business-location punch. SS
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