Why can Guangdong become the largest economic powerhouse in China?

In late January, Chinese provinces, municipalities and autonomous regions unveiled their annual economic reports for 2023, reviewing the economic achievements of the past year and setting goals for 2024. About half of these places outpaced the national growth rate of 5.2 percent last year.

After topping for 35 consecutive years, Guangdong Province in 2023 became the first province in the country to have a gross domestic product (GDP) exceeding 13 trillion yuan (about $1.83 trillion). There are only about 10 countries in the world with a GDP higher than that.

The economic powerhouse saw its GDP hit 13.57 trillion yuan ($1.89 trillion) in 2023, growing 4.8 percent year on year, according to the government work report released during the annual session of the Guangdong Provincial People's Congress. It accounted for about one-tenth of the national total.

As a manufacturing heartland, Guangdong is one of the regions with the best industrial and supply chains in the world. The added value of the manufacturing sector in Guangdong accounted for 32.7 percent of the province's GDP, the report shows.

"We adhere to the principle of the real economy as the foundation and prioritize the manufacturing industry, thus making significant progress in the construction of a modern industrial system," said Guangdong Governor Wang Weizhong.

The province also leads the country in the number of industrial enterprises. It has more than 71,000 industrial enterprises whose annual revenue from principal business surpasses 20 million yuan, and over 75,000 high-tech enterprises, according to the report.

The ability to produce cars has often been seen as a symbol of the overall level of manufacturing and technological innovation. Well-known homegrown makers of electric vehicles, such as BYD and Xpeng, have commenced full-scale production in Guangdong. Currently, one out of four new energy vehicles nationwide is made in the province.

In 2023, Guangdong achieved a 0.3 percent year-on-year increase in foreign trade, reaching 8.3 trillion yuan, which was no easy task as global demand weakened. There were notable year-on-year increases in the exports of electric passenger vehicles, lithium-ion batteries and solar batteries.

As China's biggest foreign trade player for 38 consecutive years, the province has over 130,000 enterprises in the sector of imports and exports, accounting for more than 20 percent of the national total.

In 2023, Guangdong also experienced a robust resurgence in its economy, driven by strong consumer spending, as total retail sales of social consumer goods reached 4.7 trillion yuan, up 5.8 percent. Meanwhile, the output value of Guangdong's marine production has ranked first in China for more than 20 consecutive years.

The vibrant momentum in Guangdong has pulled together a large talent pool. The province has more than 1.3 million R&D personnel, accounting for about one-seventh of the country's total. In addition, it provides jobs for 45,000 foreign talents with valid certificates and 5,000 personnel who are shortlisted for national and provincial key talent projects. They are all doing their bit in developing the province, pushing innovation and making breakthroughs.

"The strong innovation ability of enterprises is a prominent advantage of Guangdong's industries," said Wang Yueqin, director of the Department of Science and Technology of Guangdong Province. "About 90 percent of scientific research institutions, 90 percent of scientific researchers, 90 percent of R&D funds and 90 percent of invention patent applications in Guangdong come from enterprises."

Guangdong is targeting year-on-year growth of 5 percent in terms of its regional GDP for 2024. Developing the Greater Bay Area will be one of its economic priorities this year, which marks the fifth anniversary since the launch of a comprehensive development plan for the region. According to the plan, the region will become a world-class bay area in terms of trade, technology, manufacturing and infrastructure.

Moreover, more efforts will be put in place to support industries in less developed parts of the province to balance regional developments.