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China’s Guangdong, once a major economic driver, lags national growth average
- Historically a top regional performer for economic growth, Guangdong has reported lacklustre figures, drawing pressure
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Guangdong, China’s largest provincial economy, has underperformed the national average for gross domestic product growth by a large margin in the first half of the year, threatening to turn from economic driver to drag despite Beijing’s exhortations for powerhouse regions to do their part.
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The southern province’s GDP expanded by 3.9 per cent in the first six months of 2024, 1.1 percentage points lower than the national average, though it still boasts the country’s largest regional GDP. Guangdong’s growth rate in the first quarter was 4.4 per cent.
Last week, Beijing reaffirmed its resolve to meet its annual national growth target of “around 5 per cent” in a communique released at the conclusion of the third plenum – a major conclave for economic policy – a few days after the country reported slower-than-expected growth of 4.7 per cent for the second quarter.
Authorities in coastal regions, traditionally the most reliable centres for growth as industrial and trade hubs, have taken steps to boost economic activity and contribute to the national economy – with Guangdong, historically the top performer, feeling a great deal of the pressure.
Analysts blame tepid investment, consumption and business sentiment as well as protracted distress in the property sector for the subdued growth.
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