After years of talks, Chinese officials and the Walt Disney Company have finalized an agreement on a theme park deal in Shanghai.
Shanghai Mayor Han Zheng says Shanghai authorities and the Walt Disney Company agree to build the first Disneyland theme park on China's mainland.
The project is estimated at over $3.5 billion and is scheduled to open in 2014. The first phase of building reportedly covers one and a half square kilometers, out of a total of ten square kilometers earmarked for the park in the southeast suburbs of Shanghai's Pudong area.
Disney would own 43 percent of Shanghai Disneyland, while a joint-venture company owned by the local government would own 57 percent. This arrangement would be similar to the Hong Kong Disneyland that opened in 2005. The local Hong Kong government owns a 57 percent stake in that park.
Many analysts have said the attendance figures for Hong Kong Disneyland indicate the park is underperforming. But the chief economist at the Hong Kong Chamber of Commerce, David O'Rear, thinks those assessments were based on unrealistic expectations. He says there is room for a Disney park on the mainland.
"Well, it is the biggest growing consumer market in the world and it's one that is grossly under served by Disney type projects or any theme parks of the international stature," O'Rear said.
Shanghai Mayor Han says the municipal government started thinking of a Shanghai Disneyland more than a decade ago. O'Rear says when the Hong Kong theme park was announced almost ten years ago, there was speculation Hong Kong was in competition with Shanghai for the project.
O'Rear says Hong Kong Disneyland was announced in during a financially difficult time for the city.
"For Hong Kong it was something that was announced during a time of great economic crisis, so it did provide a confidence boost," O'Rear said.
Final implementation of Shanghai Disneyland still requires approval by the State Council, China's chief administrative authority chaired by the Premier Wen Jiabao.