Guangzhou’s first-half performance this year was remarkable indeed, as the trillion-yuan economy was up 7.1%, nearly a percentage point above the national average. However, within the city were two astonishing growth stories, in the Nansha and Tianhe districts, which grew at a sizzling 9.4% each.
Tianhe was the city’s leader in absolute GDP numbers, again. Its RMB226.681 billion accounted for nearly one fourth of the total for the eight districts. Despite the pressures bneing felt in the manufacturing sector, it was Tianhe’s weighting toward financial and other services (75%) that made the difference: the tertiary sector kicked in with output of RMB166.61 billion, up 11.4%.
The district, which is accessed by train via the Guangzhou East Station, is a headquarters base for 149 enterprises. These are mainly involved in the financial industry, information services, software and other IT services.
Tech developers are having a strong growth spurt in the district. New policies favoring the development of new tech clusters, such as the Guangzhou Software Valley, resulted in 15,000 new science and technology enterprises being registered in Tianhe, up 40% YoY, accounting for 34.2% of the city’s total. A total of 31 new incubators were set up, while 21 “village rejuvenation” projects were started.
Despite being a densely packed high-rise district, Tianhe is still far from being fully developed. No fewer than 143 key construction projects costing around RMB10 billion were launched here in the first half of the year. Overall, Tianhe registered 48,000 new enterprises, up 39% YoY. Among them, 8,072 enterprises had registered capital of over RMB10 million, up 88.7%.
Nansha, meanwhile, is on a fast track to catch up. Its first-half GDP of RMB75.3 billion is still less than one-third Tianhe’s, but the southernmost district is in the early phases of growth.
The district, which still has an abundance of land for development, is benefitting from forward-thinking policies and long-term planning. According to KPMG, Nansha ranked 29th in the World Bank’s global simulation of business environment in 2018. As a New Area (see our explainer), Nansha is able to innovate in many ways that Tianhe and other districts cannot. According to officlal data, Nansha has developed 457 “system innovations” such as a verification mechanism for commercial registrations (hence, the boom in new company registrations); 41 of these innovations are being replicated throughout the country.
Indeed, the past four years have seen rocketing growth in Aansha. From 2014 to 2018, here are a few of the numbers:
• Average annual GDP growth of 11%;
• Tax revenue growth of 13.3%
• Imports and exports accounted for one-fifth of the city’s total, up 12.2% on average annually;
• Registered enterprises increased from 8,400 to 90,535; and
• 146 investment projects from Global Fortune 500 enterprises introduced.
Nansha’s development is focused on new-economy industries related to innovation. It has been striving to build itself as an international scientific and technological innovation hub, shipping hub, new trade hub, regional transportation hub and a pilot demonstration zone for the opening up of the financial industry.