13pc growth forecast for Guangzhou
Tom Mitchell in Guangzhou
Guangzhou's economy is forecast to grow 13 per cent next year on the back of a government-led infrastructure spending spree and the city's emerging car industry.
The target, revealed in an economic blueprint prepared by the Guangzhou Economic and Social Development Research Centre, represents a slight increase on the 12.6 per cent growth that the city expects to see this year, which will take municipal gross domestic product past the 300 billion yuan (HK$282 billion) mark.
The centre - a think-tank under the Guangzhou Party Committee - is also projecting a 16.5 per cent increase in wages next year and a 6 per cent rise in disposable income. The city government recently set a per capita GDP target of US$10,000 (HK$77,800), which it hopes to realise by 2010.
However, Guangzhou's impressive short-term growth projections are partly dependent on government spending that is not sustainable in the long-term. Next year, the city expects to christen a new international airport and what is billed as Asia's largest convention and exhibition centre. Later this month the city's third subway line will open.
At the weekend the government projected a 14.5 per cent year-end rise in basic infrastructure construction, reaching 16.8 billion yuan.
The Southern Metropolis News yesterday quoted research centre official Xie Tianzhen as saying Guangzhou's development plans for Nansha would drive future economic growth. Nansha, an island situated in southern Guangzhou, lies at the geographic centre of the Pearl River Delta and has become the linchpin of the city's development strategy.
Mr Xie also said the car industry was becoming an increasingly important part of Guangzhou's economic mix, and even predicted that the city was on its way to becoming 'China's Detroit'. He said the industry's output could soon reach between 400,000 and 500,000 units a year, and become the country's largest automotive centre.
This would come as a surprise to cities such as Shanghai, Changchun and Wuhan, which are home to the country's largest car companies and have been singled out by the central government as China's main car centres.
It also represents a significant change of direction in Guangzhou's economic strategy, which in the past has looked to light industry and consumer spending to drive growth. This was reflected in the blueprint, which projected industrial output growth of 15 per cent next year and a 10.5 per cent increase in consumer spending. The city's retail price index, meanwhile, is expected to fall 2 per cent.