Business Consultant | CSC Global Financial Markets Share this post
December 20, 2019
4 Reasons Why China’s Greater Bay Area is the Southern Growth Engine
The Greater Bay Area (GBA) in China was first proposed in 2016 to include Hong Kong SAR, Macao SAR, Guangzhou, Shenzhen, Zhuhai, Foshan, Dongguan, Zhongshan, Jiangmen, Huizhou, and Zhaoqing. The aim is to create a high-tech economic and innovation hub to rival Silicon Valley and Wall Street. In February 2019, a blueprint was rolled out that outlines integrating the nine mainland cities in the Pearl River Delta with the semi-autonomous cities of Hong Kong and Macao. The GBA is receiving plenty of attention as a project that is more than the sum of its parts.
Several factors are contributing to the economic optimism.
I. The sheer size of the land mass
The figures that lay the foundation for the future of Silicon Valley and the Tokyo Bay Area’s rival are staggering. The GBA covers an area of 56,000 km2—just over 21,000 square miles—which is less than 1% of the whole country, or the equivalent to the land area of Croatia. This puts the size of the GBA above that of other world class city clusters such as the San Francisco Bay Area (17.9K km2), the New York Metropolitan area (21.5K km2), and the Greater Tokyo Bay area (36.9K km2).
II. The volume of people
The region is home to about 70 million people, which represent about 5% of the total population in China. This is more than the whole of the U.K., and twice that of Canada. The three biggest cities by population are Guangzhou, with 14.5 million people; Shenzhen, with 12.5 million people; and Dongguan, with 8.3 million.
III. The GDP is staggering
All combined, the economic output of the GBA amounts to aroundGDP of USD $1.6 trillion in 2018, which makes up 12% of the GDP of the whole of China. This matches the size of the economies of Russia or South Korea, and would have the GBA ranking ahead of Spain, Australia, and Mexico by GDP if it were a country. The three cities with the highest contribution to the economy of the GBA are Hong Kong, Shenzhen, and Guangzhou, with each contributing more than USD $300 billion in 2017.
IV. Logistics activity
In 2017 alone, 7.96 million tons of air freight passed through the GBA, more than the volume of air traffic in San Francisco, New York, and Tokyo combined. In addition, around 200 million passengers flew through the airports in the region in 2017. One of the aims of the GBA blueprint is to develop a world-class airport cluster, by consolidating and enhancing Hong Kong’s status as an international aviation hub, raising the competitiveness of Guangzhou’s and Shenzhen’s airports as international hubs, and strengthening the functions of airports such as those in Macao and Zhuhai. Its dominance also extends to the seas: the regions ports handled 66 million of twenty-foot equivalent unit, and three of them—Shenzhen, Guangzhou, and Hong Kong—are ranked among the top 10 container ports.
CSC has offices in both Hong Kong SAR and Shenzhen and can help your company take full advantage of the growing importance of the Greater Bay Area. Please visit our website www.cscgfm.com or send us an email at apacbusinessadvisory@cscgfm.com to get in touch with us.