Business News

HK Magnate's $250 Million Chongqing Plan Intact Despite Bo Ouster

Rethi Santra|Supervising Producer, CNBC Asia Pacific

Just weeks before Bo Xilai was sacked, sparking the country’s biggest political crisis in recent decades, Allan Zeman, a prominent Hong Kong businessman, spent an evening rubbing shoulders with the former mayor of Chongqing.

“We went out to dinner and a propaganda show with him one night and I saw the local people really hugging him, saying what a great job he’s done, and I look at that, I look at the culture of the people,” Zeman told CNBC’s The Call on Wednesday

Zeman is known as the "father of Lan Kwai Fong," the Hong Kong nightlife district he helped develop. He’s pursuing plans to develop a $250 million entertainment district in Chongqing and told CNBC he would continue despite the cloud now hanging over the former mayor.

“I was looking at it and I was really amazed at how the city has changed. In fairness to (Bo) …the city really has upgraded… there’s good economic climate out there,” Zeman said, adding that he’s not that worried by the change of guard because he doesn’t think the city will shun a project that was an initiative of their past leader.

Chongqing, a city in southwestern China is a bustling manufacturing and transport hub, with a population of 29 million in the metropolitan region. It’s one of China’s four major municipalities, the others being Beijing, Shanghai and Tianjin.

But in recent weeks, its economic future has been shrouded in uncertainty after Bo Xilai was stripped of his post as Communist Party Leader. Bo has been tangled in scandals ranging from the murder of prominent English businessman to allegations he tapped President Hu Jintao’s phone.

Zeman first replicated Hong Kong’s Lan Kwai Fong nightlife district in Chengdu. He now wants to do the same in Chongqing, Hangzhou, Ningbo and Qingdao.

“China now is looking for consumer spending. Before, they were 100 percent export driven, today they’re 75 percent export and 25 percent consumer-driven," he said.

And that drive towards consumerism means a desire for a change in lifestyle — a phenomenon Zeman said he witnessed firsthand.  

“When you go to some of these secondary cities, after seven at night, after dinner with the government officials, there’s nothing to do. You go to sleep. I was in Ningbo last week, there’s really nothing to do. They’re crying out for an area like Lan Kwai Fong.”

To develop such nightlife sites, Zeman is setting up a $1 billion private fund. He’s targeting pension funds and wealthy individuals to finance half of that. The other half will be financed by banks.

Lan Kwai Take 3 will be a 70,000 square meter food, beverage and retail project in Chongqing. Zeman heads back to the city in two weeks to source out the city’s new hot spot.