Guangdong Province, located on the South China Sea coast of the People’s Republic of China, is the Special Economic Zones and economic hub of China’s reform and opening up project since 1978. For 30 years, with the fast development of manufacturing industry, the economic growth of Guangdong Province has been in the lead nationwide for 27 years and it became one of the most important manufacturing bases in China even in the world. The Pearl River Delta in Guangdong represented by Shenzhen and Dongguan is famous for the title of World Factory.
The GDP of Guangdong in 2015 reached ¥72,812,100 billion ranking 15th in the world in terms of calculation by single economic entity according to statistics of National Bureau of Statistics. Through years of industrial development, Guangdong has built up 9 pillar industries including electronic information, electrical machinery, petrochemical, pharmaceutical, automobile, food and beverage, textile and garment, building materials, papermaking, of which the industrial added value accounts for 70% of the whole.
As the economic hub, the manufacturing industry in the Pearl River Delta has been focusing on business extension and already covered the whole industry chain. For example, the electric manufacturing industry in Gongguan and Shenzhen has obvious advantages in the integrated supply chain from design and production to package and logistics with the world-class infrastructure.
Through years of development, the Pearl River Delta is competitive in the market of machine manufacturing and it becomes the global supply and distribution center of precision parts and consumption center of machine tools with the production of micro-machine, new battery and precision parts ranking first in the world. Guangdong is the most important market of die and mould industry. There are over 10,000 mould manufacturing enterprises and 300,000 people who occupy in the industry. The production and sales value of mould manufacturing takes up over 40% of the whole in China. Guangdong has 5 large-scale enterprises of machine, hardware and mould ranking in the top 10 list of mould enterprises in China.
The electronic information industry of Guangdong ranks first among other provinces in China. Guangdong is the most important production base of IT products. The electronic information industry is mainly spread in the Pearl River Delta represented by Shenzhen, Guangzhou, Dongguan, Huizhou, Foshan, Zhongshan, forming a well-known electronic information industry hub in China. In 2015, the computer, communication and other electronic industries above designated size reached a sales value of ¥3.27 trillion, accounting for 28.9% of China’s total sales value. And the industrial added value of these manufacturing industries reached ¥7.17524 trillion, accounting for 23.7% of the industrial added value of Guangdong according to National Bureau of Statistics.
Communication industry has been the largest scale electronic information industry with fast growth. Famous Companies such as HUAWEI and ZTE keeps developing at an astonishing speed. As a leading global information and communications technology solutions provider, HUAWEI reached revenue of ¥395,009 million in 2015 realizing 35.3% increase comparing with the last year according to the Annual Report of HUAWEI while Apple Inc. reached net sales of ¥233,715 million in 2015 realizing 27.9% increase comparing with 2014 according to the Annual Report of Apple Inc. HUAWEI became the third enterprise which realized shipments of more than 100 million mobile phones after SAMSUNG and iPhone.
Guangdong has developed to an electrical machinery cluster centering on Guangzhou, Shenzhen, Foshan and other cities which have a good foundation of manufacturing while spreading to the Pearl River Delta to promote the development of surrounding areas. The economic district owns a number of advantaged products which possess large market shares in domestic. Household appliance industry in Guangdong holds a significant position in China, featuring with a complete range of products, advanced production supporting facilities. Moreover, there are a number of famous brands and powerful companies in Guangdong such as Midea, Gree, Galanz, TCL, Skyworth, Hisense and so on. Midea occupies 4.6% market shares in the global large household appliances market, ranking 2nd in the global market in 2015. The revenue of TCL and Skyworth are respectively ¥104.6 billion and ¥37.9 billion.
Guangdong is the largest automobile production base in South China. The automobile industry is centered on Guangzhou and Foshan and radiates to the main districts of the Pearl River Delta. Currently, the scale of production of automobile production is expanding and forms an automobile industry cluster with competitive product development capabilities and export competitiveness. The passenger car of joint venture brands dominates the market and Toyota, Honda, VW and many other world-renowned automobile enterprises established its branch in Guangdong.
Especially, Shenzhen BYD Group has made a leap in the new energy automobile industry, of which the new energy product occupies over 10% market shares in the globe. According to the statistics of China Association of Automobile Manufacturers (CAAM), the sales volume of new energy passenger car of BYD had hit the records of 61,722 ranking first in global new energy automobile sales ranking list.
In China, as living conditions continue to improve, people are becoming more and more willing to invest in home decoration. People’s increasing purchasing power has driven the furniture market to develop in leaps and bounds. In 2015, the total retail sales of furniture products by units above a certain scale grew 16.1% year-on-year to ¥244.50 billion.
After more than 20 years of rapid growth in its furniture industry, China has now become the world’s largest furniture production base and exporter. According to information released by the China National Furniture Association (CNFA), among all regions in China, the Pearl River Delta has the highest concentration of the furniture industry with the highest production output and strongest integrated support capability.
The Pearl River Delta has a complete production system, well-developed sales market and supporting industries. The production value of furniture in Pearl River Delta accounts for one third of China and the value of exports took up over a half. Shunde, a city in the Pearl River Delta, has more than 2000 furniture manufacturing companies and over 200,000 people who occupy in the furniture industry. Dongguan is also a famous furniture production base in which many large-scale furniture companies located.
Guangdong is also the production base of construction materials ranking first in China according to the quantity. Nearly 8,000 construction material enterprises grew up in Guangdong thus forming a batch of unique and influential product clusters, such as Foshan ceramics, Foshan (Shunde) construction coating, Foshan (Dali) aluminum profile, Chaozhou sanitary ware, Yunfu stone, Jiangmen (Kaiping) bathroom plumbing and so on.
For example, the exports of ceramics in Guangdong accounted for 75.8% of the total exports in 2013 while Chaozhou is the production base of sanitary ceramics. Currently, Guangdong construction material industry is transforming to new and high-tech industry characterized with smart manufacturing. The automatic production and robot manipulating task have become “New Normal” of sanitary, coating and wooden flooring enterprises.
Although the pharmaceutical industry started late in China, it is one of the fastest developing industries in recent years. At present, China has become the second largest market of pharmaceutical industry after USA and is showing great potential. The medical technology industry in Guangdong has been leading the market and it is the production base of medical devices for Chinese medicine. There are over 2,100 medical device production enterprises in Guangdong Province. For example, Mindray, as a world’s leading medical device manufacturer with its headquarter in Shenzhen, has sold its products and solutions to over 190 countries and 100,000 health care organizations. Mindray not only maintains the top position for market share in the pharmaceutical industry in China, but also the third largest manufacturers of life sign monitor system after GE and Philip. The net revenue of Mindray in 2014 was ¥1,322,814,000 realizing 87.8% increase comparing with 2011. Today, Mindray’s products and services can be found in healthcare facilities in over 190 countries and regions. 50% of emergency departments and 90% of anesthesiology in Turkey teaching hospitals use Mindray ultra sound systems.
Guangdong, with the GDP accounting for 10% of the nation and value of the import and export accounting for 25% of the total value, is the best platform for overseas enterprises to enter China market. As the opening door in South China of the initiative of Silk Road Economic Belt and the 21st Century Maritime Silk Road, Guangdong will make contribution to the cooperation with our neighboring countries and build a convenient and fast transit corridor connecting the domestic market to the overseas world.