China's Strong Start to 2017 Evident in 31 Provinces' First-Quarter Economic Data
Lin Xiaozhao
/SOURCE : Yicai
China's Strong Start to 2017 Evident in 31 Provinces' First-Quarter Economic Data

(Yicai Global) May 2 -- First-quarter economic data published by 31 Chinese provinces shows they started the year strong. Coastal provinces and energy-based economies witnessed growth.

Zhejiang led coastal provinces in economic growth rate. The gap between Guangdong and Jiangsu, two major economic power provinces, narrowed.

The gross domestic product of four developed coastal provinces -- Guangdong, Jiangsu, Shandong, and Zhejiang -- surpassed CNY1 trillion (USD145 billion).

Guangdong and Jiangsu

Guangdong's GDP in the first quarter was CNY1.94 trillion, an increase of 7.8 percent, Guangdong Provincial Bureau of Statistics data shows. Its growth rate was up 0.5 percentage points year-on-year and was 0.3 percentage points higher than 2016's full-year rate. Guangdong's first-quarter growth rate was the highest it has been since 2014.

Enhanced growth in the service sector (which had a contribution rate of 62.5 percent), an increase in industrial production (with a 7.1-percent year-on-year increase in industrial added value), and a rise in consumption as well as imports and exports drove Guangdong's economic development, said Guangdong Provincial Bureau of Statistics Director Xing Xiaowei.

Jiangsu's first-quarter GDP ranked second. It was CNY1.88 trillion, up 7.1 percent.

Guangdong's lead is shrinking. The gap between the top two provinces narrowed by CNY14.77 billion to CNY61.55 billion from CNY76.32 billion a year earlier.

Guangdong's GDP in 2008 was CNY580 billion more than Jiangsu's. Since then, Jiangsu has caught up with Guangdong every year except 2016.

Zhejiang and Hangzhou

Zhejiang's first-quarter GDP was CNY1.06 trillion, an 8.0-percent increase.

"Zhejiang's 8 percent GDP growth rate ranked highest among the economic developed provinces in the eastern coastal areas, surpassing Guangdong, Shandong, Jiangsu, and other provinces," Zhejiang Provincial Bureau of Statistics Director Wang Jie said recently. "This has not been seen over the years. The 18 percent increase in the general public budget is also the highest among these provinces."

Alibaba and Ant Financial have contributed to the new economy and strategic new industries that have helped transform Zhejiang province. The added value of Zhejiang's information industry stood at CNY85.8 billion in the first quarter, up 16.5 percent year-on-year and accounting for 8.1 percent of the province's GDP. Its price growth was 19.4 percent.

In Hangzhou, an e-commerce business hub, the information economy achieved an added value of CNY61.4 billion in the first quarter, an increase of 22.2 percent, Hangzhou Bureau of Statistics data shows. E-commerce, mobile Internet, and digital content industries increased by 45.8, 45.3, and 33.8 percent, respectively. Cloud computing and big data, software and information services, and integrated circuit industries grew by 28.3, 27.8, and 24.3 percent, respectively.

Zhejiang has focused on the intelligent economies and intelligent industries using new-age internet technology to promote the 'Zhejiang-Made' development in recent years, said Professor Hu Taxen, Director of Public Service and Performance Evaluation Research Center of Zhejiang University.

Yangtze River

Provinces in the mid and upper reaches of the Yangtze River saw the fastest growth. Tibet, Chongqing, and Guizhou saw more than 10 percent growth rates and Guizhou's growth rate has ranked in the top three in the country for 25 consecutive quarters. Yunnan's growth rate reached 9.9 percent, ranking fourth. Jiangxi, Anhui, and Sichuan's growth rates were among the country's top ten.

Improved transportation has made it more convenient to travel to the Yangtze and Pearl River Deltas. Provinces in the mid and upper reaches of the Yangtze River have lead the country in economic growth in recent years.

The industrial layout and in the mid and upper reaches of the Yangtze River has been good in recent years, and the industrial structure has been more balanced, attracting a large number of companies to settle in the Yangtze and Pearl River Deltas, said Guizhou Provincial Academy of Social Sciences Professor Hu Xiaodeng. Equipment manufacturing, electronic information, and high-tech industries in these areas have developed rapidly.

Some 287 million mobile phones were produced in Chongqing last year. Guizhou produced 130 million units. The provinces ranked second and fourth in the country, respectively.

Energy Provinces

Downward pressure on large energy intensive provinces has been relieved in the past few years. Heilongjiang province's first-quarter GDP of CNY279.8 billion marked a growth rate of 6.1 percent, 1.0 percentage points higher than in 2016's first quarter.

Liaoning's GDP was CNY457.47 billion, up 2.4 percent year-on-year, Liaoning Provincial Bureau of Statistics data shows. The province saw its first positive growth after four consecutive quarters of negative growth last year.

Shanxi's CNY280.94 billion GDP represented an increase of 6.1 percent. The province's growth rate was up 3.1 percentage points over the same period last year and was 1.6 percentage points above last year's whole-year rate.

There was a large decline in energy prices over the past few years and province that focus on heavy industry and energy faced a lot of downward pressure. Since last year, energy prices bottomed out and these provinces' economies also picked up, said Peng Peng, vice president of Guangdong Provincial Institute of Economic Reform.

Last year, of the main industrial products in Shanxi rebounded, Shanxi Provincial Bureau of Statistics data shows. Coal, coke, and metallurgical products prices rose 43.4, 67.1, and 30.6 percent, respectively.

The energy price increase may be temporary, Peng said. "The ability to prevent risks is indeed relatively weak if over-reliance on the energy industry." Energy-based economies should diversify, Peng said.

Follow Yicai Global on
Keywords: Provincial Government , Regional , GDP , Energy Intensive Economy , Structure Reform , New Economy