Source: Global Times Published: 2018-4-23
First quarter GDP data just published by 17 areas underlines the structural reforms and optimization taking place from Chinese coastal provinces to inland areas, experts said on Monday.
According to data compiled by domestic news site thepaper.cn, a total of 17 areas have released their first quarter GDP as of Sunday.
In terms of GDP growth, 11 of them reported a slowdown compared with the same period in 2017. South China`s Hainan Province and North China`s Tianjin Municipality reported the most drastic decline in growth rates. Hainan`s first quarter GDP dropped to 5.1 percent from 8.9 percent in 2017. Tianjin saw its GDP slump from 8 percent in the first quarter of 2017 to 1.9 percent this year.
In terms of total GDP, Shanghai surpassed Central China`s Hunan Province with GDP of 786.34 billion yuan ($124.70 billion) while Tianjin was surpassed by East China`s Jiangxi Province and Northwest China`s Shaanxi Province.
Central China`s Henan Province reported first quarter GDP of over 1 trillion yuan for the first time.
Experts said the differences in GDP data show the effects of the broad structural reform that has pushed for industrial relocation and structural optimization.
"In general, the western provinces are catching up in GDP growth rates. This shows the combined effects of both the central government`s policies for economic rebalancing and local governments` drive to develop their economies based on comparative advantages," said Wan Zhe, chief economist with the International Cooperation Center of the National Development and Reform Commission.
Southwest China`s Guizhou Province, for instance, benefited from targeted poverty alleviation efforts, along with infrastructure development and local efforts to improve the big data industry, Wan said. Guizhou led the 17 areas with growth of 10.1 percent in the first quarter.
"On the other hand, the fact that Shanghai could improve its ranking shows that eastern localities, after the initial dividends from reform and opening-up, can still find growth momentum," said Wan, with their advantages "shifting from labor and geography to capital and technology."
Cong Yi, a professor at the Tianjin University of Finance and Economics, said his municipality has felt acute pain in the last two years amid the transformation process.
"Tianjin has had to curb its traditional sectors such as heavy and chemical industries. But while these industries have been shrinking in Tianjin, the new growth drivers such as high-end manufacturing have not been strong enough to replace the lost GDP," Cong told the Global Times on Monday.
Tianjin`s GDP growth reached 13.8 percent in 2012, but in 2017 the figure was 2.6 percent.
"Tianjin has attracted a number of companies in the biomedicine, pharmaceutical and high-end manufacturing sectors, but these firms need time to mature and they need localized auxiliary industries to take shape to form viable industrial clusters," Cong said.
Among Beijing, Tianjin and Hebei Province, and the Xiongan New Area, Tianjin also has to rethink its niche amid the new division of labor and the integration of North China, he noted.
China announced the establishment of the Xiongan New Area on April 1, 2017, as part of measures to transfer non-capital functions out of Beijing and advance the coordinated development of the Beijing-Tianjin-Hebei region.
Wan noted that even though western provinces are developing quickly, they should be cautious about balancing their growth prospects and local debt in order to achieve sustainable development over the long term.
Wan Zhe is a visiting fellow of Chongyang Institute for Financial Studies at Renmin University of China.