Reminds me of "The City and the City" in which the two countries occupy the same space but are bound by law to pretend the other doesn't exist. http://www.goodreads.com/book/show/4703581-the-city-the-city
https://en.wikipedia.org/wiki/Exclusive_mandate
This resulted in all kinds of awkwardness, because of course both German states had to interact in practice (just think of public utilities of split Berlin), but somehow didn't want to set a precendent proving the other a) existed and b) was legitimate.
I saw it as a metaphor for those things in our cities we choose not to see, e.g. poverty and homelessness.
Overall, I loved the theme, setting, language, but didn't get much out of the plot. That's mostly how I've felt about all the Mieville books I've read so far. (With the exception of The Scar which was delicious in every aspect.) I keep reading them because I love every sentence, page, chapter, but I don't expect the whole to ultimately satisfy.