While China’s economy is still blazing ahead at an amazing pace, regions outside the conventional Tier 1 markets may offer the most lucrative opportunities. In 2016, more than ever given the shifting patterns of China’s economy, it will be worth looking at the vast country through the changing fortunes of its cities.
The key to growth may now lie in the “Rising Suns”: Places that few outsiders have heard of, such as Guiyang, Xiangyang and Hengyang, which will shine brightly in 2016, their economies growing by up to 12%. Coincidentally, in their names they all have the character yang, which means “sun” in Chinese.
A key shift in these markets has made them an ideal growth market: 40% of all Chinese prefecture-level cities will have an average disposable income of at least 30,000 yuan (nearly $5,000) by 2016—an important threshold, at which people start to spend on goods other than food and clothes.
A brief overview on the Rising Suns cities below, see the original article from the Economist here, a synthesised review of the top cities below (from the original post here).
No. 1: Guiyang
Guiyang is the capital of Guizhou province of Southwest China. Guizhou has been the poorest of China provinces with economy heavily relying on state owned enterprises. With the population of 2.8 million, it is now becoming a hub of operations for Chinese giant telecom companies. Private companies are also following the lead with Alibaba setting up cloud-computing facilities in the city.
Guiyang also serves as an important transportation hub for South Western China with Guiyang–Guangzhou High-Speed Railway already operating and three more high-speed rail lines tocommence operations within the next few years.
Disposable income per person is currently at USD 5,100, almost half of China’s average of USD 9,800. Guiyang has been ranked number 1 fastest growing local economy by the Economist.
Xiangyang is a prefecture-level city in northwestern Hubei province. Xiangyang possesses large water energy resources whilst its mineral deposits include rutile, ilmenite, phosphorus, barite, coal, iron, aluminum, gold, manganese, nitre, and rock salt.
Textile production has been the mainstream industry of the area, however, in the last few years, it has become an attractive destination for industrial transfers, the trend of companies relocating their manufacturing facilities to cheaper locations.
With its population of 1.6 million and disposable income per person stands at USD 4,300 and the city has been ranked at number 2 among China emerging cities.
Hengyang is the second largest city of Hunan Province after its capital Changsha. The population of the metro area is 1.3 million but if counting the suburbs, it reaches over 7 million people. Hengyang’s disposable income per person is currently USD 4,900.
Chongqing is a major city in Southwest China and one of the five national central cities in China. Administratively, it is one of China’s four direct-controlled municipalities (the other three are Beijing, Shanghai and Tianjin), and the only such municipality in inland China. Chongqing disposable income per person stands at USD 5,400.
It is an enormous city of 8.9 million people and booming real estate market. It is also one of the fastest urbanizing centers in China with more than 1,300 people moving into the city daily, adding almost 100 million yuan (US$15 million) to the local economy.
Suqian is a prefecture-level city in northern Jiangsu Province. With the population of about 1 million and relatively low disposable income per person (USD 4,100), Suqian is still one of the cheapest location for manufacturing in the province.