Guangdong GDP up 6.5%

Following the release last week of national data showing the country’s economy had slowed to its lowest growth rate in three decades (6.2%), the National Bureau of Statistics has released data showing Guangdong’s GDP grew faster than the national average, up 6.5% at RMB5.05 trillion. 

Highlights of the data, according to the provincial government, were:

  • Urban unemployment of 2.23%, down 0.18% YoY
  • Utilized FDI up 5.9% in Q2 (+2.9% YoY); 
  • Fixed asset investment up 10.5% in Q2 (+0.4% YoY) and 1.5 % higher than the annual target; 
  • Loans to non-financial enterprises and government institutions up 19.2% in Q2 (+2.6 % YoY);
  • ·     Foreign trade volume growing (1.3%) for three consecutive months; exports growing (3.9%) for four consecutive months.
  • Retail sales up 7.7% YoY, up 0.8% QoQ.

More importantly to us, the province’s private sector is leading the way in industrial output. Privately owned enterprises grew 7.5% YoY, compared to overall growth of 4.8%. The pillar industries were solid:

  • Computer, communication and electronic devices manufacturing up 8.9%;
  • Electrical machinery and equipment manufacturing up 7.7%;

Some stars were:

  • 3D-printing equipment up 334.5%;
  • New Energy Vehicles up 184.2%;
  • Mobile communication base stations up 128.4%;
  • LCD screens up 30.8%;
  • Software and IT services up 21.3%;
  • Internet and related services up 19.2 %.

Private investment is growing, too, 0.9% higher in Q2, accounting for 58.4% of total fixed-asset investment. Foreign trade by private enterprises was up 5.9%, accounting for 50.7% of the province’s total export-import volume. The private economy now employs more than 70% of the workforce, their number rising by 685,600 YoY (+4.4%).

The financial sector appears to be in reasonable shape, but lending is clearly ramping up. At the end of June, the deposit balance of domestic and foreign currencies of financial institutions was up 11.9% YoY, the highest growth in nearly 17 months; the balance of loans increased 16.2%. Insurance premium income increased 21.2%. 

The real estate market, meanwhile, appears to be cooling. home sales in Q2 were down 3.2% from Q1. 

The government’s hand is not far from the investment button, of course. Infrastructure investment increased 24.3% YoY, of which the production and supply of electricity, gas and water rose 26%, railway transport 17.7%, and water conservancy, environment and public facilities management 34.2%. Investment in education, medical care and other areas to improve people’s livelihood developed rapidly with investment on education growing by 37.0%, health and social work by 40.8%. 

Retail sales appear to have been stimulated by government policies, with growth of automobiles surging 7.9%. Communication equipment, Chinese and Western medicine and office supplies maintained double-digit growth, growing by 14.8%, 21.0% and 10.9% respectively.

Guangdong’s total import-export volume reached RMB3.28 trillion in the first half, up 1.3% YoY and up 2.3% in Q2.

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