Economy of Guangdong

The Economy of Guangdong is one of the most prosperous in China. Guangdong is located in southern China, bordering on the special administrative regions of Hong Kong and Macau. It is also the largest economy of a sub-national entity in terms of GDP CNY5.26 trillion (US$836.19 billion) in all of Asia, save for Tokyo and sixth or seventh largest sub-national entity in the world.

Overview

Shops in one of the streets of Guangzhou specialize on selling various electronic components, supplying the needs of local consumer electronics manufacturers. The shop in front is in the LED business.

This is a trend of official estimates[1] of the gross domestic product of the Province of Guangdong with figures in millions of Chinese Yuan:

Year Gross domestic product
in millions RMB
1980 24,521
1985 55,305
1990 140,184
1995 538,132
2000 966,223
2008 3,570,000
2009 3,776,000 [2]
2010 4,550,000

After the communist revolution and until the start of the Deng Xiaoping reforms in 1978, Guangdong was an economic backwater, although a large underground, service-based economy has always existed. Economic development policies encouraged industrial development in the interior provinces which were weakly linked to Guangdong via transportation links. The government policy of economic autarchy made Guangdong's access to the ocean irrelevant.

Deng Xiaoping's open door policy radically changed the economy of the province as it was able to take advantage of its access to the ocean, proximity to Hong Kong, and historical links to overseas Chinese. In addition, until the 1990s when the Chinese taxation system was reformed, the province benefited from the relatively low rate of taxation placed on it by the central government due to its post-Liberation status of being economically backward.

Although Shanghai is often cited as evidence of China's success, Guangdong's economic boom demonstrates that China has become a labor-intensive manufacturing economy. Guangdong's economic boom began with the early 1990s and has since spread to neighboring provinces, and also pulled their populations inward. Guangdong is China's largest exporter, as well as its largest importer of goods.[3] Its extensive manufacturing base is largely privately owned, making it less reliant on fixed asset investments than other provinces in China.[3]

The province is now one of the richest in the nation, with the highest GDP among all the provinces, although wage growth has only recently begun to rise due to a large influx of migrant workers from neighboring provinces. Its nominal GDP for 2011 was 5.26 trillion yuan (US$836.1 billion).[4]

In 2008, Guangdong's primary, secondary, and tertiary industries were worth 197 billion yuan, 1.84 trillion yuan, and 1.53 trillion yuan respectively.[5] Its per capita GDP reached 37,588 yuan (about US$5,410).[6] Guangdong contributes approximately 12% of the total national economic output.[5] Now, it has three of the six Special Economic Zones: Shenzhen, Shantou and Zhuhai. The affluence of Guangdong, however, remains very much concentrated in a handful of cities near the Pearl River Delta.[3]

In 2008 its foreign trade also grew 7.8% from the previous year and is also by far the largest of all of China. By numbers, Guangdong's foreign trade accounts for more than a quarter of China's US$2.56 trillion foreign trade or roughly US$683 billion.[7]

Recently, more than 7000 factories based in southern Guangdong cities such as Shenzhen and Dongguan has shut due to rapidly falling demand from western consumers, stricter labour and environmental regulations and the global financial crisis.[8][9]

Economic and Technological Development Zones

References

  1. ↑ official estimates
  2. ↑ http://www.newsgd.com/news/weeklynews/content/2010-01/11/content_8003453.htm
  3. ↑ 3.0 3.1 3.2 http://www.thechinaperspective.com/topics/province/guangdong-province/
  4. ↑ http://www.chinadaily.com.cn/business/2011-02/14/content_12004550.htm
  5. ↑ 5.0 5.1 News.xinhuanet.com 02-04-2006
  6. ↑ News.xinhuanet.com 02-02-2006
  7. ↑ Guangdong reports 20% foreign trade growth
  8. ↑ http://www.newsweek.com/id/143661
  9. ↑ http://www.google.com/hostednews/ap/article/ALeqM5gssNAVOFZK3RKWh9dBGtMmxhgpOAD95604B00