BY BARBARA MANINGAT
ANCHOR ALEX HOLLEY
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Mickey Mouse, Minnie Mouse and the whole Disney gang will have a new home -- in Shanghai.
The 3.9 square kilometer Shanghai Disneyland resort officially began construction Friday morning with a large breaking ground ceremony in Disney style with song, dance and all the lovable characters. (Video from CCTV)
The excitement is clear, but media is buzzing as China enters another slow year of economic recovery. Despite these concerns, many are calling this park a profitable move for Disney and the LA Times says Shanghai is the perfect location.
“For Disney, the park represents a highly sought entree into one of the most promising consumer markets in the world to sell merchandise and market movie and TV brands despite tight government restrictions.”
Disney will not be taking on the 24.5 billion Yuan or $3.7 billion investment alone. The Chinese central government recently approved a joint venture between Disney and a state-owned business conglomerate, the Shanghai Shendi Group. The Shanghai Shendi Group will have the majority ownership with 57% stake and will split the costs and the profits with Disney.
But some say it may be a small world after all, because there are currently two Disneylands in Asia -- and China already has one that has never made a profit. Euro News covers the concern and the response from Disney’s chief executive, Robert Iger. (Video from Euro News)
BOB IGER: “I am thoroughly confident in the future of Hong Kong Disneyland and believe that China, which is a much larger country than the United States, is more than capable of supporting and sustaining two wonderful Disney destinations.”
A Fox Business analyst stresses there’s enough financial stability on the city level for Shanghai to be a place where dreams come true.
“But let’s remember that Shanghai, a city where capitalism, not communism, has been a mainstay for centuries. Shanghai will be Disney’s real gateway to all of Southeast Asia. And remember one more thing, guys. China, 1.3 billion people and 30 million newcomers to the middle class every year and the Disney brand means the same thing to people all around the world.”
And that brand is expected to rake in the dough. Shanghai government officials expect more than 7 million tourists immediately after the grand opening – hope to transform the city into a world – class tourist destination – in the next five years. Both theme parks, the hotels, the merchandise sales will all add to Disney’s international value.
But The Wall Street Journal says Disney’s ultimate moneymaker is not part of the plans -- yet. (Video from CCTV)
“Among the things that didn't accompany approval of the resort project: The ability to broadcast Disney programming on Chinese television airwaves… If Mr. Iger gets his wish for a television presence, Disney could find itself competing—or collaborating—with Shanghai Media Group.”
Both of China’s Disneyland resorts will be under construction for some time as the Hong Kong location is under expansion to offset the building of the new Shanghai site.
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Transcript by Newsy.