Zhuhai - China's Hidden Treasure

Hong Kong, Macau, Guangzhou and Shenzhen are famous cosmopolitan cities in Guangdong Province which are already well known to seasoned travellers. Bordering Macau and Hong Kong is Zhuhai, a second tier city which is heralded as the Chinese Riviera due to its 190 islands. With a current population of just over 1.5 million people, Zhuhai is China’s ‘hidden treasure’.

Zhuhai is one of the core cities on the west bank of the Greater Pearl River Delta (GPRD) which comprises nine cities: Guangzhou, Shenzhen, Zhuhai, Dongguan, Zhongshan, Foshan, Huizhou, Jiangmen and Zhaoqing, along with the Special Administrative Regions of Hong Kong and Macau.

A pioneer in economic reform, Zhuhai was one of the four earliest Special Economic Zones (SEZs) established under the leadership of Deng Xiaoping. The creation of Special Economic Zones paved the way for China’s recent transformation from a planned to market economy. 

After 30 years of economic development in Zhuhai, six key manufacturing sectors have been developed comprising of electronics, home electric appliances, power and energy, biomedicine and medical devices, petrochemical, precision equipment and yacht manufacturing.

According to the “Outline of the Plan for the Reform and Development of the Pearl River Delta (2008-2020)” released by the State Council in January 2009, Zhuhai is specified as a core city and transportation hub on the western bank of the Pearl River Estuary.

The economic significance of Zhuhai cannot be ignored. It is one of China’s fastest growing, outward oriented and attractive investment regions. In 2010, foreign trade was valued at US$751.1 billion (representing 25.3% of the national total).

At the end of 2010, 11,064 FDI projects from 70 countries had been approved in Zhuhai, with FDI totaling US$12.7 billion. The city has been successful in attracting large multinational corporations to invest in 85 projects in Zhuhai, including Canon (from Japan), Flextronics (US), Panasonic (Japan), Bosch (Germany), Phillips (Netherlands), BP (UK), Shell (UK-Netherlands) and China’s National Offshore Oil Corporation (CNOOC). In March 2011, the Zhuhai provincial government signed agreements with a series of leading SOEs (state owned enterprises) with investments worth over US$26 billion.

The Zhuhai Free Trade Zone encourages investment in warehousing, logistics and export processing. In 2010, the gross industrial output from the zone hit RMB 7.076 billion, accounting for 5.1% of Zhuhai’s total. The foreign trade of the zone exceeded US$1.558 billion, comprising US$730 million in export value and US$828 million in imports. By 2008, more than 150 companies from 20 countries and regions had established businesses in the zone. In 2010, the utilized FDI in the zone amounted to US$45.98 million. Large investors include MTU, EPCOS, Oplink, Coloplast, SCHMID, Tyco Electronics, ProLogis, Canon and domestic firms such as Mingde Logistics and Zhuhai Flight.  In the first quarter of 2011, Zhuhai FTZ’s GDP reached RMB 388 million, the gross industrial output hit RMB 1.45 billion, and foreign trade amounted to US$ 390 million.

Zhuhai has a growing financial services industry with over 50 foreign financial institutions operating in Zhuhai city, seven of which are foreign banks including Morgan Stanley, Bank of East Asia and Standard Chartered Bank. The number of foreign banks will increase in the years ahead due to the development of new infrastructure, particularly the fast road and rail links to neighbouring Hong Kong, Shenzhen and Guangzhou.

New infrastructure is in fact the key to Zhuhai’s economic development. Construction is currently underway for a 49.9 km long bridge linking the cities of Hong Kong, Zhuhai and Macau which will be finished by 2016 (see map below). When complete, Zhuhai will become the only city that links the Special Administrative Regions of Hong Kong and Macau. This is very significant for the huge commercial benefits that will flow between the economies of these three major cities in Southern China.

Many Chinese tourists travel to Zhuhai to witness its spectacular landscape. The region has an exceptional environment consisting of mountain ranges, rivers, beaches and islands together with a very pleasant climate. As a result, Zhuhai has received numerous honours and accolades such as the “National Environmental Protection Model City”, “National Hygiene City”, “National Ecological Demonstration Zone”, one of the “Chinese Cities with the Greatest Investment Potential”, the “International Award for Best Practices to Improve the Living Environment” by the UN Habitat, the “National Advanced Science and Technology City”, and even scoring the “Top 10 Chinese Cities with the Greatest Sense of Happiness”.  A popular destination for many Chinese tourists, Zhuhai comprises a wealth of islands such as the Outer Lingding Island, Guishan Island, Hebao Island and Dong’ao Island. Many people travel to Zhuhai for its abundance of beaches, sea views and hot spring resorts.

Over the past few years, Zhuhai has stepped up efforts to develop advanced manufacturing in certain industry sectors such as general aviation, ocean engineering equipment manufacturing, ship building and marina development.  I have a particular interest in the economic development of Zhuhai due to my involvement in the Zhuhai (Australia) Yacht Industrial Garden Project where I am facilitating business and investment links between Zhuhai and New South Wales. This project was approved by the Central Government’s State Council in 2012 as a “key project of coastal industry in Guangdong”, and involves the building of a new world class “yacht city” on a footprint the size of the city of Sydney.

I will be leading a NSW delegation to Zhuhai later in the year and look forward to introducing Australian business leaders to the delights of Zhuhai, China’s hidden treasure. For more on the Zhuhai (Australia) Yacht Industrial Garden Project, please see the issue of "Think Global with David Thomas - December 2012" below: