When Shanghai decided to renovate its central Xintiandi (“New Heaven and Earth”) district, it focused on traditional 19th-century houses called shikumen, refurbishing them as souvenir stores, art galleries and Starbucks cafes with imperial-style facades. The neighbourhood now bustles with camera-toting millennials, and drives huge consumer spending.

The experiment was hailed a success and touted as a model of Chinese urban development. In the north-eastern city of Harbin, the central historic district of Lao Daowai was chosen for similar treatment.

Young people don’t really go to Lao Daowai. What’s the point? Ye Xia

Walk Lao Daowai’s streets today and you’ll find a kind of gentrified nostalgia: the old residences have been demolished and replaced with remakes in the “Chinese-baroque” style (two-storey stone houses with European exteriors and Chinese interior courtyards). Shops peddle kitschy Russian memorabilia and cafes offer lattes and sourdough bread, hoping to attract young consumers with time to spare and cash to spend.

But unlike Xintiandi, Lao Daowai is eerily quiet. During my visit it was empty but for a handful of wandering tourists.

In Lao Daowai, Harbin, old residences have been demolished and replaced with remakes in the “Chinese-baroque” style. Photograph: Yi-Ling Liu/The Guardian

“Young people don’t really go to Lao Daowai,” says Ye Xia, a PhD student in comparative literature at Heilongjiang University in Harbin. “What’s the point? What is there to do? I would only want to go hang out a place where there are other young people.”

It illustrates the challenges faced by Harbin, the once-thriving capital of Heilongjiang province, which has been rocked by an exodus of young talent attracted to the more successful likes of Shanghai, Beijing and Guangzhou. Across the north-east Dongbei industrial region, of which Harbin is part, more than 2 million people left between 2000 and 2010.

Dongbei, a trade hub with Russia in the 1920s and home to an influx of Jewish immigrants on the eve of the second world war, became under Mao a powerful manufacturing base dubbed China’s “eldest son” because it shouldered the nation’s economy. But it has suffered in recent decades as the steel and coal industries have declined, and is now referred to by the less enviable term “rust belt of China”.

Harbin does not feel like a city in decline. On Central Avenue, the longest pedestrian street in China, an elaborate ice-sculpture advertises the mobile phone company Huawei and an H&M store sells its wares inside a Russian baroque building, one of the vestiges of the city’s varied architectural past. And the Songbei district, a 738 sq km new town that was industrial wasteland only a decade ago, is now packed with residential high-rises, office towers and the world’s largest indoor ski resort.

But the region is highly dependent on the state: 55% of industrial jobs in Heilongjiang province are in state-owned enterprises, compared to just 17% in China as a whole. As the country has embraced market reforms, and the big coastal cities have reaped the rewards, the region has fallen behind: its contribution to China’s GDP has dropped from 13% to 7% since 1980.

A Russian baroque-style building houses an H&M store on Harbin’s Central Avenue, the longest pedestrian street in China. Photograph: Yi-Ling Liu/The Guardian

This slowing in the face of a shifting economy is new territory for Harbin, and for China. Indeed, the city’s challenge is similar to that faced by many post-industrial cities in the west, such as northern UK cities like Newcastle and Middlesborough or the US rust belt cities of Detroit and Pittsburgh: how to prevent, or manage, decline.

Harbin is not quite in the same situation as a city like Detroit, where the population fell dramatically over the second half of the 20th century, says Ren Xuefei, professor of global urban studies at Michigan State University. In contrast, Harbin’s population of 5 million is still growing. “Detroit’s urban master plans aspire to shrink the city and make it more compact,” says Ren. “In Harbin, the aspiration is to expand and make the city larger.”

She says Harbin is better understood not as a city in decline so much as a city playing catch-up. “[Harbin] is still developing, just nowhere near as quickly as first-tier cities like Beijing and Shanghai,” she says. Growth in GDP across the Heilongjiang region in 2017 was 2.7%, which although not in the same league as coastal Jiangsu (10.1%) is not recession either.

Nevertheless, an anxious national government has taken note that Harbin is lagging behind its peers. It has drawn up a plan to revitalise the old north-east industrial bases, and announced in 2016 that it would pump 1.6tn yuan (£183bn) into the north-eastern provinces in the next three years.

The municipal government, meanwhile, wants to rebrand the city as a cultural capital. In both China and the west, the “creative economy” – the role of arts and culture – has been raised as a means of reviving post-industrial cities.

Lao Daowai was designated a preserved historical area in 2016. Photograph: Yi-Ling Liu/The Guardian

Harbin has pinned its hopes on large architectural projects such as Songbei, a newly built area north of the Songhua River modelled after Shanghai’s booming Pudong financial district, and renovating neighbourhoods such as Lao Daowai, named a “preserved historical area” in 2016. But it has struggled to match the appeal of China’s more attractive coastal cities. The Lao Daowai regeneration is a “mimicry of Xintiandi,” according to Ren, “yearning to become the cosmopolitan mini-Shanghai that lies beyond its reach.”

A major obstacle is Harbin’s lack of human capital. It simply does not have enough consumers and workers to fill the new spaces being created. The best students leave for better opportunities and higher-paying jobs; in 2016, less than 50% of university graduates from the Dongbei region chose to work with employers in their home provinces, far below the 75% national average. At Harbin Institute of Technology, one of China’s top engineering universities, only 3% of alumni decide to stay.

“Most of my friends who leave Harbin will not come back,” says Ye. She wants to work as a high school teacher after graduation; in Harbin, she would earn 3,000 yuan per month, whereas in a southern city like Shenzhen, she could fetch a monthly salary of up to 10,000 yuan. The disposable income of Harbin’s residents is only a fraction of that in Shanghai, 28,000 yuan a year (£3,160) compared to 48,000 (£5,420).

The big architecture projects are similarly hamstrung. In Songbei, the city commissioned a new opera house, a sprawling white structure of glass and aluminium designed by the star architect Ma Yansong that opened in 2016. The building is part of an effort to rebrand Harbin as China’s “music city”, which also includes luring visitors during warmer seasons by hosting an annual Harbin summer music festival.

Without sufficient human talent, however, such initiatives are limited. “On one hand, [the municipal government] aspires to refashion the city into a cultural capital. On the other hand, it struggles to draw upon declining human capital and creative talent to make things happen,” Ren wrote in a recent essay. She points to the new Songzhuang art district next to Harbin Normal University – again, modelled after a similar artist colony in Beijing – as an example of such a failed effort. “You can’t have an artist district without artists,” she says.

The Harbin opera house, designed by Ma Yansong. Photograph: Yi-Ling Liu/The Guardian

More effective than top-down interventions, perhaps, are broad cultural policies that can retain young talent, to keep them from fleeing south in search of better opportunities and to draw them back to the city to innovate.

Here Harbin can draw on lessons learned by post-industrial cities elsewhere. In the US, while “high-profile cultural centres or ballparks may have dramatic appeal, more important is sustained investment in education, job-training and university partnerships to generate new employment opportunities,” according to Elihu Rubin, professor of urbanism at Yale School of Architecture.

In Harbin, such policies “might include lowering real-estate prices [or] providing government subsidies for startups or low-interest loans for university students”, says Ren.

Li Gang, an independent music producer from Harbin, remains hopeful about the potential of Harbin’s cultural industries. Since he arrived as a university student five years ago, independent music performances have proliferated from a couple to a couple hundred, and ticket prices have risen from 10 to 100 yuan.

“A few years ago, the young people I met were mostly ‘Beijing drifters’,” says Li, referring to people who migrate to China’s capital in search of a better life. “But in the last few years I’ve had friends open their eyes to new possibilities and come back to try to run startups and businesses back here in Harbin.

“Perhaps I’d leave the city if I changed my job. But outside Harbin, the rice and beer simply isn’t as delicious.” The rest of the city will need more than that to convince them to stay.

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