Economist Intelligence Unit
Uploaded by: Knoema
Accessed On: 10 August, 2015
Where will business opportunities in urban China arise as a result of rapid increases in populations, incomes, infrastructure and economic activity? Five years ago The Economist Intelligence Unit (The EIU) looked to answer that question. We devised an emerging city rankings index and published a report on the subject, CHAMPS: China’s fastest growing cities, which highlighted the rise of inland Chinese cities. It identified 2007 as a pivotal year for the economy, when inland China started to grow at a faster rate than the more developed coastal region. The aforementioned CHAMPS came not from the east, but from north-eastern, central and western parts of the country: Chongqing, Hefei, Anshan, Maanshan, Pingdingshan and Shenyang.
But five years is a long time for any economy, especially one changing as quickly as China’s. In the period since we published CHAMPS, a new national leadership has been installed, with a different set of priorities. In 2010 the government was still in stimulus mode, focused on responding to the events of the 2008-09 global financial crisis. Now, the priority is unwinding the credit bubble and excess industrial capacity that formed during that period. Structural reforms to put the economy on a more balanced, sustainable path, with growth driven by consumption rather than investment, have been promised.
These changes have persuaded us that it is an opportune time to update our analysis of China’s most promising cities. Prospects have altered dramatically over the past five years. Many have found themselves exposed to weaker domestic demand for commodities. Others have seen the bursting of real-estate markets. Some cities have taken to heart the central government’s advice to focus on industrial innovation, environmental sustainability and urban liveability. All have been grappling with the consequences of tighter restrictions on debt issuance and a crackdown on investment incentive policies.
Our emerging city rankings index aims to identify fast-growing cities. As such, it is based on growth indicators, such as changes in GDP, population, income and infrastructure. The index combines historic data with forecasts provided by Access China, our China Regional Forecasting Service.