Once known as "Paris of the East," Shanghai in the early twentieth century was the most glamorous, decadent and cultured city in China and all of Asia. After years of being closed off to the rest of the world, Shanghai is rapidly regaining its reputation as a cosmopolitan city. While Beijing is the capital, recognized as the center of politics, culture, information, and academia, Shanghai is widely regarded as the financial center of China, a progressive enterprising city, open to new ideas.
Unlike Beijing, Shanghai's history does not date very far back. Until 1842, it was a small sleepy fishing village. Shanghai, in Chinese, means "by the sea." Its advantageous location, on the banks of the Yangtze River delta, would soon propel it to prominence.

Up until 1842, China and Britain were engaged in a bitter conflict. Britain was smuggling opium into China. While Britain was making a financial killing, hundreds of Chinese were becoming addicted - leading to social decay and degradation, much to the concern of the Qing Dynasty rulers. China responded by dumping British opium into Hong Kong, which subsequently set off two opium wars between the two nations. At the conclusion, a humiliated China was forced to admit defeat to the better armed British armies. As part of Britain's terms, China was forced to give up its sovereignty on Hong Kong as well as other advantageous treaty ports - Shanghai being one of them. Other Western powers soon joined Britain to lay claim on the precious land.

After the war, Britain declared Shanghai a treaty port, and the sleepy village was suddenly transformed into a city with many foreign influences. The British, the French, and the Americans each took up autonomous concession zones in the city, each of which were independent of Chinese law. Each brought their own colonial influences to the city, which can still be seen today in the European architecture of the buildings on the Bund and in the old French Concession area.

Shanghai soon became an important industrial center and trading port in China, drawing hundreds of people to the city. Those times were prosperous times, and Shanghai gained its reputation for being one of the most cultured and sophisticated cities in the world. The rich, foreign "taipans" led self indulgent lives by gambling in casinos, going to cabarets and spending money in brothels.

But while the rich got richer, the poor got poorer. Many local Chinese lived in absolute squalor and poverty. With weak and corrupt Chinese rule and rampant exploitation by foreigners, it was inevitable that rebellion and revolt would take place. It had its roots when the declining Qing Dynasty was overthrown, and the Nationalist Party took over, declaring a new Republic of China with Sun Yat-sen as president. Marxism soon became a popular ideology among Chinese intellectuals, and in 1921, the Communist Party was first formed in Shanghai. Among its member was a young Mao Zedong. The Communist Party and the Nationalists initially formed an uneasy alliance to reunify China under Chinese sovereignty. But Shanghai would have to weather another invasion by the Japanese during World War II. Afterwards a power struggle between the Communists and the Nationalists forced the Nationalists to flee to Taiwan.

In 1949, the People's Republic of China was declared under Communist rule by Mao Zedong. And Shanghai's reign as the most cosmopolitan city in China ended. Political infighting and power struggles within the Communist Party led to further chaos for the country. After Mao's death, Deng Xiaopeng rose to power, and in 1979, he initiated a program of market liberalization and reform to kick-start China's economic development. Shanghai was to especially benefit from the reforms. In 1990, Shanghai was chosen as the city to drive China's economic progress. And it has responded with a booming construction industry, increasing private businesses, rising personal incomes and growing foreign investments. Currently, it is the one of the most industrial bases in the country. With its economic progress, Shanghai is also undergoing a renaissance revival in its arts and culture, signaling a return to its triumphant days in the past.