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Economic Observer reporter Zhang Rui As a "first-tier city", Guangzhou's gross domestic product (GDP) was once again surpassed by Chongqing in the first half of 2024, sparking heated discussions online.

On July 27, the official website of the Guangzhou Municipal Bureau of Statistics released data showing that in the first half of 2024, Guangzhou's GDP was 1,429.766 billion yuan, a year-on-year increase of 2.5%. Earlier on July 23, the official website of the Chongqing Municipal Bureau of Statistics released data showing that in the first half of 2024, Chongqing's GDP was 1,513.824 billion yuan, a year-on-year increase of 6.1%.

Comparison of the above two sets of data shows that in the first half of this year, Guangzhou was surpassed by Chongqing in terms of both economic volume and economic growth rate. Going back in time, in 2022, Guangzhou's annual GDP (2883.90 billion yuan) was also surpassed by Chongqing (2912.903 billion yuan). Not only that, according to Economic Observer, in the past few years, Guangzhou has often been listed as a competitor by cities such as Hangzhou, Chengdu, and Suzhou, which are known as "new first-tier cities", in many hot topics related to urban development, and even the sayings of "Beijing, Shanghai, Shenzhen, and Hangzhou" have appeared from time to time.

On July 29, a number of economists told Economic Observer that the public's concern about Guangzhou being "overtaken" by Chongqing is, to a certain extent, also a concern about whether Guangzhou is "falling behind" in the development of "first-tier cities."

It is worth noting that from another measurement indicator, GDP per capita, there is still a clear gap between Chongqing and Guangzhou. Statistics bureau data from Guangzhou and Chongqing show that in 2023, Guangzhou's GDP per capita will be about 161,600 yuan, while Chongqing's GDP per capita will be about 94,100 yuan, which is roughly equivalent to the level of Huizhou City in Guangdong Province.

Automotive industry under pressure

On July 27, the Guangzhou Municipal Bureau of Statistics’ official website released the economic operation status and interpretation of Guangzhou in the first half of 2024, stating that in the first half of this year, Guangzhou faced the challenges of market cyclical problems such as sluggish domestic and foreign demand, as well as the intertwined challenges of structural problems such as the transformation of traditional pillar industries. The city’s economy operated steadily under the pain of alternation between old and new growth drivers, the economic growth rate slowed down, and the positive momentum was temporarily under pressure.

Among them, in terms of industrial production under pressure and transformation, in the first half of this year, the added value of industrial enterprises above designated size in the city decreased by 0.8% year-on-year. Among the three pillar industries, the production of automobile manufacturing continued to be under pressure, with the added value decreased by 16.4%. In terms of the consumer market, in the first half of this year, affected by factors such as weakening demand for automobile and oil retail and the sluggish retail market for decoration and furnishing supplies related to real estate, the total retail sales of consumer goods was 560.155 billion yuan, which was the same as the previous year.

Lin Jiang, deputy director of the Hong Kong, Macao and Pearl River Delta Research Center of Sun Yat-sen University, told Economic Observer that in the first half of this year, the automobile industry, which contributes half of Guangzhou's economy, was under great pressure. He said that from the perspective of the development of the automobile industry, new energy vehicles are indeed showing an overall positive trend. For example, BYD Auto and Xiaomi Auto have performed very well. Guangzhou also hasXpeng MotorsDespite this, the impact of the sluggish fuel vehicle market on Guangzhou's auto manufacturing industry cannot be ignored. "This year, some news about GAC Honda's layoffs and factory closures also proves that (Guangzhou's auto manufacturing industry is under pressure)," said Lin Jiang.

Zheng Tiancheng, deputy director of the Enterprise and Market Research Center of China (Shenzhen) Comprehensive Development Research Institute, told Economic Observer that industrial growth is a key factor in driving the GDP of major cities in my country. Judging from the GDP data of nine key cities including Beijing and Shanghai in the first half of this year, the development of the industrial economy in major cities in my country is currently facing the situation of pressure from traditional industrial fields and rapid development of new quality productivity industrial fields. He believes that it is expected that traditional manufacturing powerhouses will continue to be under pressure in the automotive industry, and Shanghai, which is also a strong automotive manufacturing city, also faces similar transformation difficulties. Both cities are in urgent need of greater transformation and upgrading.

On July 25, Peking University Shenzhen Graduate School's Peking University HSBC Think Tank Platform released the "Economic Analysis of the Guangdong-Hong Kong-Macao Greater Bay Area in the Second Quarter of 2024", which also pointed out that in terms of industrial production, the sluggish production of automobile manufacturing, textile and garment industry, and special equipment manufacturing industry dragged down the industrial production growth of Guangzhou and Foshan; while the strong recovery of the consumer electronics industry in the same period drove the industrial production growth of cities such as Shenzhen and Dongguan. In addition, in terms of the consumer market, the decline in social consumption growth is not only common in Guangzhou, but also in other cities in the Pearl River Delta.

Questions about “falling behind”

Does Guangzhou still have its leading advantage as a “first-tier city”?

Zheng Tiancheng's answer is yes. He believes that rather than saying Guangzhou has "fallen behind", it is better to say that more and more cities in China are developing in an "all-round way" and each has its own advantages.

Lin Jiang also believes that it is a fact that Guangzhou has been overtaken by Chongqing in terms of GDP, but there is no need to be too obsessed with it. "At present, traditional industries are doing subtraction, and the foundation of emerging industries is well laid out but not fully developed, which is why Guangzhou is in trouble," he said.

Both scholars believe that GDP is only one of the reference coordinates for measuring the strength of a city, but not the only one. Taking the comparison between Guangzhou and Chongqing as an example, the statistics bureau data of the two places show that in 2023, Chongqing's total area is about 10 times that of Guangzhou, and its permanent population is about 1.7 times that of Guangzhou.

"The area of ​​Chongqing is about the same as that of Jiangsu Province. Chongqing has an advantage in scale over Guangzhou in terms of GDP." Zheng Tiancheng said that the two cities have the same thing in that they are both comprehensive cities. Chongqing is currently still in the stage of large-scale industrialization, while Guangzhou has entered the post-industrial stage. The driving forces for economic development of the two cities are different.

Zheng Tiancheng also said that Guangzhou's comprehensive strength is not necessarily reflected in GDP growth. He cited the example of Guangzhou's cross-border e-commerce sector, which has spawned companies such as Shein (a cross-border e-commerce company with the Chinese name "希音"), TEMU (Pinduoduo"It may not reflect a particularly large data blessing in terms of GDP, but more of a resource integration of the local clothing industry and small and medium-sized enterprises." He believes that considering the number of people entering and leaving the country, Guangzhou's strength in facing the world and opening up to the outside world has a full leading advantage both in the country and the world.

Earlier, the 2023 Global Cities Index Report released by the internationally renowned consulting firm Cornell stated that from 2020 to 2023, the scores of most cities in the world declined to varying degrees in the three years affected by the COVID-19 pandemic. However, Guangzhou's ranking among global cities has continued to rise since 2019. From 2020 to 2023, Guangzhou ranked 63rd, 60th, 56th, and 55th respectively, thanks to diversified corporate activities, increasingly mature unicorn companies, and strong talent attraction. The report believes that business activities and human resources are the main driving factors for Guangzhou's continued growth.

At the same time, the report also shows that from 2020 to 2023, except for Beijing, Shanghai, Guangzhou and Shenzhen, Hangzhou and Chengdu will be ranked around 80th, showing an upward trend; the rankings of Nanjing, Wuhan, Tianjin, Xi'an and Chongqing will fluctuate around 100th.