SFC Markets and Finance | Guangdong 2025: Around 5% growth, is it achievable?

南方财经全媒体记者 谭海燕 郑玮 杨雨莱 广州报道

Editor's note:

Guangdong has long been recognized as a key pillar of China’s economy, accounting for about one-tenth of the country's GDP. Meanwhile, Guangdong is ramping up efforts to construct an end-to-end innovation chain, aiming to become a globally influential innovation base. However, Guangdong’s economy is facing some challenges as global economic growth stagnated. Going forward, how can Guangdong remain resilient and sustainable growth? SFC Markets and Finance's special coverage "Navigating Economic Cycle" will try to find answers.

China’s economic powerhouse Guangdong Province aims for about 5% GDP increase this year. Meanwhile, Guangdong also eyes a 3% hike in public revenue, about 5% percent hike in total retail sales of consumer goods. As global risks and external pressure are increasing, how can Guangdong achieve its goals in this year? Professor Lin Jiang of Linnan College at Sun Yat-sen University share his insights.

Guangdong on Track to Realize About 5% Growth in 2025

Lin Jiang: Guangdong has ranked first in GDP nationwide for 36 consecutive years. This figure reflects Guangdong's role in stabilizing economic growth and its contribution to maintaining the stability of the national economy, effectively serving as a cornerstone for China's economic development.

Firstly, as a major province for foreign trade, Guangdong continues to play a crucial role in stabilizing foreign trade and supporting the broader economic growth of the country. Therefore, Guangdong should focus on stabilizing foreign trade to sustain growth. This is especially important, even as we may face challenges such as the potential return of Trump to the White House and the risk of new tariffs. In this context, Guangdong must leverage its role as a major trade hub, withstand pressure, and rise to the challenge to achieve stable growth. This is the first key point.

The second key point is that Guangdong, as a major consumption hub, also plays a vital role in stabilizing domestic consumption. In 2025, I believe that beyond driving sustained growth in foreign trade, Guangdong should focus on expanding domestic demand. This includes guiding manufacturers to produce consumer-oriented products, whether in AI, low-altitude economy, bio-pharmaceuticals, or other industries that promote consumption upgrades. Put effort into these aspects, particularly working on the development of new quality productive forces, leveraging productivity growth to expand domestic demand and consumption.

In 2024, Guangdong's foreign trade surpassed 9 trillion yuan for the first time, demonstrating strong resilience and vitality. What gives Guangdong its competitive edge, and how can we push the boundaries even further? With rising external uncertainties, how can the province stabilize foreign trade and secure steady growth? Chongyang Institute for Financial Studies of Renmin University Research Fellow Liu Ying, offers her views.

Multiple Measures to Stabilize Foreign Trade

Liu Ying: In terms of measures, there are several key aspects. First, from a broader perspective, local governments are providing stronger support for export and import businesses. This includes financial support, policy incentives, and improvements to the business environment. Since much of the foreign trade is conducted by foreign enterprises, which invest and produce in China and trade globally, it’s crucial to enhance government support in this area.

From the perspective of market entities, the key actually lies in stabilizing trade with Europe, North America, and Japan. This is most critical. At the same time, expanding into new markets is also vital. For instance, in ASEAN, we need to effectively implement the RCEP framework. Similarly, the Latin American market holds great potential. Take our Chancay Port as an example. We will have more trade through such ports, reshaping trade patterns not only across the Americas but also globally. This port not only strengthens our trade connections with Peru but also deepens ties with Chile, Brazil, and the rest of South America. I believe trade with the Americas is likely to increase rather than decline. Therefore, diversifying and expanding trade partnerships is crucial.

Another important region is the Middle East. Currently, with significant investments and projects in the Middle East, our enterprises are actively expanding overseas. Therefore, strengthening trade ties with this region should be a priority. Meanwhile, there is still untapped potential in trade with African countries, as well as with Australia and New Zealand.

On another note, I believe regional cooperation could be a viable approach if we aim to enhance trade within the broader industrial and supply chains. This aligns closely with Guangdong's strengths. For instance, Shenzhen’s "20+8" initiative for emerging and future industries, and our traditional industrial advantages. Combining the development of emerging and future industries, we can leverage industrial and supply chain trade to drive the development of our trade. This could very well be a key area of focus moving forward.

In addition, Guangdong has always been a pioneer and testing ground for China's reform and opening-up. In terms of opening up, beyond traditional goods trade, shouldn’t we place greater emphasis on the growth of service trade? This way can attract a large number of foreign enterprises, especially in the context of the rapidly evolving digital economy. More importantly, we must recognize our strengths and potential. Our traditional advantages, such as manufacturing, are well-established. However, our new growth drivers—new engines, new models, and new business formats—are increasingly prominent, particularly in the realm of service trade.

Technological innovation is the cornerstone of new quality productive forces, driving the emergence of new industries, models, and growth drivers. As we step into the new year, how can Guangdong accelerate its efforts to build a modern industrial system? Which sectors hold the greatest potential for future development? Wei Qijia, Researcher at the State Information Center, shares his perspectives.

Guangdong Has Many Advantages in Building a Modern Industrial System

Wei Qijia: Guangdong Province boasts unique geographical advantages and early-stage accumulations for building a modern industrial system. The favorable conditions accumulated in the past, combined with the Guangdong-Hong Kong-Macao Greater Bay Area’s in-depth advancement of policies, provide strong support for Guangdong to accelerate the construction of a modern industrial system.

Guangdong should leverage its resource endowment and industrial foundation, closely monitor the national industrial layout, and focus on its competitive industries. By concentrating its strengths, Guangdong can cultivate several pillar industries that highlight its unique advantages, are large in scale, and have strong driving power, forming a modern industrial system with distinct regional characteristics.

For example, we need to expand and strengthen the foundation of key industries, such as electronic information, automobiles, smart home appliances, and intelligent equipment. We need to upgrade and improve those strategic industrial clusters. At the same time, it is important to accelerate the development of emerging industries, such as integrated circuits, advanced energy storage, new energy vehicles, and bio-pharmaceuticals, transforming them into new trillion-yuan industrial clusters, which will have strong growth potential and significant impact.

In terms of specific efforts, there are several key areas of focus. On one hand, in the development of various industries and supporting infrastructure, it is crucial to establish mechanisms that deeply integrate innovation chains, industrial chains, capital chains, and talent chains. Technological innovation should drive industrial upgrading, and innovation chains should be deployed around industrial chains.

Second, we must foster the emergence of new industries through technological innovation and align industrial chains around innovation chains. Additionally, we need to seamlessly integrate funding with every stage of the R&D process, improving the financial system to better support innovation. We should also develop supporting systems that enable talent to fully realize their potential.

At the same time, it is essential to fully leverage the Greater Bay Area’s role in connecting domestic and international markets, focusing on both physical inter-connectivity and institutional connectivity to continuously enhance global resource allocation capabilities. By coordinating these efforts and forming policy synergies, we can advance industrial foundation and modernize supply chains, promote intelligent, green, and integrated development in manufacturing, and further solidify the foundation for building Guangdong’s modern industrial system.

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