LOS ANGELES, CA (Catholic Online) - The project has already accrued much of the multi-billion cost with corporate investments.

According to state media reports, the area will be China's fifth "state-level development zone" and the first in the country's rapidly developing interior. Among other Chinese areas enjoying widespread expansion are Shanghai's Pudong and Tianjin's Binhai, home to a half-built, 120-building replica of Manhattan. The Lanzhou project was approved last August.

"Mountain flattening" began in October, according to the China Economic Weekly magazine. The project will eventually enable a new urban district almost 10 square miles in size northeast of downtown Lanzhou.

The Nanjing-based China Pacific Construction Group, one of the country's largest private companies headed by Yan Jiehe, is behind the initiative. The 52-year-old Yan, a former teacher is often portrayed in China as a home-grown Donald Trump. Yan is now for his over-reaching ambition and is highly adept at navigating among his nation's vast network of "guanxi", or personal connections.

However, skepticism has met Yan's plan. Lanzhou is home to 3.6 million people alongside the silty Yellow River with major environmental concerns. The World Health Organization named it the city with the worst air pollution in China last year. Currently, the city's main industries include textiles, fertilizer production and metallurgy.

One official who says the plan is unsuitable is Liu Fuyuan, a former high-level official at the country's National Development and Reform Commission. Liu points out that Lanzhou is frequently listed as among China's most chronically water-scarce municipalities. "The most important thing is to gather people in places where there is water," he said.

Others question the validity of building a new city in the middle of the desert. "All this investment needs to be paid back with residential land revenue, and I don't see much on returns in these kinds of cities," Tao Ran, an economics professor at Renmin University in Beijing says. "If you have a booming real estate market it might work, but it seems to me that real estate in China is very, very risky."

In an email interview, a China Pacific Construction Group spokeswoman dismissed criticisms of the project as unjustified. "Lanzhou's environment is already really poor, it's all desolate mountains which are extremely short of water," said Angie Wong. "Our protective style of development will divert water to the area, achieve reforestation and make things better than before."

The government hopes to allay these concerns. The new area "will lead to an environmentally sustainable economy based on energy-saving industries" including advanced equipment manufacturing, petrochemical industries and modern agriculture, wrote Chinese Central Television on its Web site.

© 2012, Catholic Online. Distributed by NEWS CONSORTIUM