The proposed relocation of some of the Shanghai's oldest factories to allow redevelopment of the 2010 World Expo site will modernize and boost their outdated production capabilities, planners predict.

The 140-year-old Jiangnan Shipyard, the oldest existing shipbuilder in China, will be moved from the Huangpu River site to a site earmarked to become the largest shipbuilding base in the world on Changxing Island, on the mouth of Yangtze River.

The 100-year-old Shanghai Pudong Steel Corporation on the eastern bank of the Huangpu River will carry out ambitious expansion plans in Luojing, closer to its parent company the Baosteel Group.

However, some of the factory's existing buildings, such as the workshops, will be retained on the expo site and converted into exhibition and recreational facilities during the next three years.

A steel-making workshop of the Pudong steel factory will be renovated into a theater and after the Expo, it will be used mainly for community entertainment. Another electric furnace workshop will become an exhibition pavilion.

An old workshop of the Jiangnan Shipyard, located in Puxi, will be rebuilt into corporate pavilions and an industry-themed museum.

"To host the fair means a new development opportunity for these enterprises," Zhong Yanqun, standing deputy director of the World Expo 2010 Shanghai Executive Committee, said.

"On the other hand, these factories and a history they marked of Shanghai's early industrial growth could be remembered here because some of their buildings will be retained."

Jin Qing, a senior manager of Shanghai Pudong Steel Corporation said the Luojing project would be finished in two phases over five years. The steel factory will be moved to Luojing by the end of this year when its first phase is completed.

After relocating, production capacity is expected to more than double to 10 million tons of steel and iron products by 2012.
"We will introduce the world's most advanced steel-making facilities and technology in the new factory to optimize the diversity of our products and improve their quality," Jin said.

The Jiangnan Shipyard's size will double when it moves to Changxing, and by 2010 it will have an annual production capacity of 4.5 million deadweight tons.

Shanghai Port Machine Plant, another enterprise to be relocated to the Changxing Island because of the expo, has already built new docks and gantry cranes along the shore and has commenced operations. It expects to gain an annual production value of 6 billion yuan (775 million U.S. dollars), three times its current earnings.

Zhu Ronglin, an economics professor from East China Normal University said the relocation of Shanghai's old factories was in line with the city's vision to move the manufacturing industry out of the inner city and attract more service industries.

"Meanwhile, the balance between different land values and the compensation that has been offered to them a good chance to update its facilities and technologies," he said.

Wu Zhiqiang, chief designer of the expo site and dean of Architecture and Urban Planning School of the Tongji University said about one fifth area of the expo site would have retained factory buildings.