21.8.2001

 

HUBEI PROVINCE（湖北省）

 

Economic Indicators

	1999		2000
Economic Indicators	Value	Growth	Value	Growth
		(%, y-o-y)		(%, y-o-y)
Area (sq km)	185,900	--	185,900	--
Population (mn)	59.4	0.5	60.3^	1.5
Gross Domestic Product (RMB bn)	385.8	4.1 *	427.6	9.3 *
Per Capita GDP (RMB)	6,511	3.5	N/A	N/A
Disposable Income Per Capita
- urban (RMB)	5,212.8	7.9	5,524.5	6.0
- rural (RMB)	2,217.1	2.1	2,268.6	4.4
Fixed-assets Investment (RMB bn)	91.3	2.4	98.8	8.2
Added Value Output
- primary industry (RMB bn)	65.2	-12.8	66.2	1.5
- secondary industry (RMB bn)	188.8	7.7	212.3	12.4
- tertiary industry (RMB bn)	131.6	9.4	149.0	13.2
Retail Sales (RMB bn)	161.7	9.2	178.9	10.7
Inflation (Consumer Price Index, %)	-4.1		-1.0
Exports (US$ bn)	1.5	-4.4	1.9	26.7
- by FIEs (US$ bn)	0.3	19.2	0.4	33.3
Imports (US$ bn)	1.5	-3.1	2.2	70
- by FIEs (US$ bn)	0.6	-13.0	0.6	0
Foreign Direct Investment
- number of projects	260	-21.2	336	29.2
- contracted amount (US$ bn)	0.8	56.5	1.1	29.7
- utilized amount (US$ bn)	0.9	-6.0	0.9	3.1

Notes: * In Renminbi real terms                              

^ Latest population census, 1999 figure was estimate based on previous survey.

Sources: Hubei Statistical Yearbook and State Statistical Bureau

 

General Background

 

Hubei - abbreviated as Er（鄂）- is situated in the north of Dongting Lake（洞庭湖）at the middle reaches of the Yangtze River in central China.

 

Wuhan is the capital of Hubei.  Approved by the State Council, Wuhan（武漢）, Huangshi（黃石）and Yichang（宜昌）carry out economic policies that are equivalent to those of the coastal open cities.

 

The fertile Jianghan Plain（江漢平原）in Hubei is one of the major agriculture and aquaculture bases in China for producing grain, cotton, oil-bearing crops, fishes and vegetables.

 

The province is rich in mineral resources.  Deposits of phosphate, salt, silica, garnet and marlstone are among the highest in China.  Hubei also has rich deposits of metal minerals such as rutile, iron and copper.

 

Infrastructure

 

Water Transport － Wuhan and Huangshi are the major ports on the Yangtze River, which are able to handle vessels up to 3,000-5,000 tons capacity.  Frequent feeder service is also available between Wuhan and ports along the Yangtze River to Shanghai and Chongqing.

Railways － Major railways in Hubei include the Beijing-Guangzhou（北京－廣州）line, Beijing-Kowloon（北京－九龍）, Shanghai-Wuhan（上海－武漢）, Wuhan-Chengdu（武漢－成都）and Jiaozuo-Zhicheng（焦作－枝城）lines, connecting the province to all directions in the country.

 

In the Tenth Five-Year Plan, the Hunan government is going to invest heavily in the construction of railways and highways. The construction of the Shashi-Yueyang（沙市－岳陽）line is underway. Another major railway, the Chongqing-Huaihua（重慶－懷化）line’s construction had begun recently.

 

Besides, as part of the Tenth Five-Year Plan, the central government plans to construct a railway running along the Yangtze River.  The new railway will cross various provinces and municipalities including Sichuan, Hubei, Jiangxi, Anhui, Jiangsu, Chongqing and Shanghai so as to bolster the economic development along the Yangtze River.

 

Highways － There are 8 inter-provinces highways and 118 intra-province highways covering all cities, counties and most villages and towns in the province.  A new expressway in Xihaigu area of the Ningxia Hui Autonomous Region will be built within 5 years.  This road will form an integral part of the expressway between the city of Yinchuan and Wuhan.  The Yinchuan-Wuhan Expressway will be 390 kilometers long.

 

In the Tenth Five-Year Plan, the central government is going to construct 2 major highways, one of them linking Beijing and Zhuhai and the other one linking Shanghai and Nanning. Major sections of these two highways will pass through Hubei and their constructions are underway.

 

Air Transport － There are 7 airports in Hubei including the Wuhan, Yichang, Sanxia, Xiangfan and Shashi airports.  The largest one, Wuhan Tianhe（天河）Airport has an average of 230 flights each week with a total passenger handling capacity of 4.2 million.  Daily flight between Hong Kong and Wuhan is also available.

Telecommunications － Telecommunications services have made remarkable progress in Hubei.  Currently, there are over 2.1 million subscribers for mobile phone services and mobile phone users in Wuhan, accounting for over half of the province's total.

 

Electricity － Electricity is adequately supplied in Hubei.  It has an exploitable capacity of 33.1 million kWh, which takes the leading place of Chinese power field.  Apart from the Gezhouba（葛洲壩）and Danjiangkou（丹江口）Hydroelectric Power Sta­tions which boast a combined capacity of 3.6 million kWh, the Three Gorges（三峽）Hydroelectric Station is also under construction.

 

Gas Supply － Construction of a new gas pipeline will be started by end-2000.  The gas pipeline will link the provinces of Sichuan and Hubei.  Main part of the pipeline starts at Zhongxian County in Chongqing and ends in Wuhan.  The whole project is expected to complete by early 2003.

 

Industries

 

In 2000, Hubei's industrial output totalled Rmb313.1 billion.  The province has developed into an important industrial production base with its major industries including metallurgy, machine-building, textiles, electronics, foodstuff, automobiles, ship­building, chemicals and construction materials.

 

Hubei is an important base of iron and steel industries in China.  It has formed a relatively comprehensive iron and steel industrial system which include geological prospecting, designing, construction, mining, separation, smelting, rolling.  The Wuhan Iron and Steel (Group) Corp. is one of the famous steel giants in China.     

 

Hubei is one of the major automobile production centres in China.  It produced over 132,400 vehicles in the first half of 2001 and ranked the third in China, after Jilin and Shanghai.  The Dongfeng Automobile Co. Ltd. and Aeolux Automotive Co. are significant in this industry, especially in western China, where the Dongfeng automobiles occupied 90% share of the market. Its importance will grow as the Great Western Development Strategy implements. By the year of 2010, the province will be able to produce over 900,000 vehicles a year.

 

Textile industry has developed into a pillar industry with comprehensive range of products including cotton textile, wool textile, linen textile, knitting, silk textile, printing and dyeing, chemical fiber, fiberic material processing.  In coming years, Hubei will give top priority to energy, telecommunications and raw materials production industries and speed up the automobiles, machinery industries and agriculture, and further improve the tertiary industry.

 

Tourism

 

Hubei is the home of the ancient kingdom of Chu. Archeologists have discovered over 400 ruins and sites of historical value in the province.

 

Beautiful tourist spots in Hubei include Jingzhou Ancient City（荊州古城）, Chibi of Puqi（蒲圻赤壁）, the Shennongjia National Park（神農架國家公園）, Birthplace of Zhaojun（興山－王昭君故里）, Wudang Mountain（武當山）- the holy place of Daoism（道教）,Longzhong（隆中）, Huang He Pavilion（黃鶴樓）and the Three Gorges（三峽）.

 

In 2000, over 450,800 (+47.6%) tourists visited the province and generated revenue of US$146 million (+39.0%).  One major factor contributed to the increase was the Yangtze Three Gorges International Tourism Festival in Yichang City in September 2000.

 

Consumer Market

 

In 2000, retail sales of consumer goods in Hubei rose by 10.7% to Rmb178.9 billion. Major consumer markets are located in Wuhan and Jingzhou. 

 

Wuhan has been a major distribution centre in Central China.  It attracts a number of retail enterprises from other Chinese provinces and overseas countries to set up their shops in tapping the market potential of the region.  For instance, Jiali Mall（佳麗廣場）from Hong Kong's Luks Industrial, New World Shopping Arcade（新世界百貨商場）from New World Development Group and Wuhan Mall（武漢廣場）from Tak Shun Group have invested in Wuhan's retail business.  Also, Pearl River Commercial City（珠江商城）from Guangdong, Shanghai Commercial City（上海商城）from Shanghai and Wangfujing Department Store（王府井百貨）from Beijing have also opened their branches in Wuhan.

 

Major local retail enterprises in Wuhan include Wuhan Department Store（武漢市武漢商場集團）, Wuhan Zhongnan Commercial Group（武漢中商集團）, Wuhan Hanshang Group（武漢市漢商集團）, Wuhan Zhongxing Department Store（武漢中興百貨）, Hubei Huishang Group（湖北省匯商集團）and Hubei Jinshang Group（湖北金商實業集團）.

 

Foreign Trade

 

Hubei's exports totalled US$1.9 billion (+26.7%) in 1999.  Major commodities included agricultural and sideline products, textiles and light industrial products, chemi­cals and heavy industrial products.  Major export markets were Hong Kong, Japan, the US, Germany and Taiwan.

Imports rose by 70% to US$2.2 billion in 1999.  Major import goods included timber, textiles, machinery, chemicals and raw materials.  Major import sources were Japan, Hong Kong, Australia, the US and Republic or Korea.

 

Hong Kong is the major trading partner of Hubei.  In 1998, Hong Kong's exports accounted for nearly 37% of the province's total, reaching US$1 billion.  In terms of imports, US$93 million came from Hong Kong, accounting for nearly 14% of the province's total.

 

Foreign Investment

 

In 2000, contracted foreign investment rose by 29.7% to US$1.07 billion.  The number of foreign invested projects and actual utilised investment also increased by 29.2% and 3.1% to 336 and US$944 million respectively.  Major investments came from Hong Kong, The US, Canada, Singapore and Taiwan.

   

Foreign investments mainly involved in the sectors of medical, telecommunications, chemical, infrastructure and real estate.  World well-known enterprises have also invested in the province such as Coca-Cola and McDonald from the US, Siemens from Germany, Philips from the Netherlands, Ericsson from Sweden, etc.

 

Wuhan is the major city in Hubei to attract foreign investment.  In the first half of 2001, the city actually utilized foreign capital amounted to US$369 million. Hong Kong is the major investor with more than 2,000 enterprises in Wuhan.  France is another major investor in the city.  Currently, French investment in Wuhan totalled US$1.5 billion, accounting for 13% of the city's total overseas investments.  French investment in Wuhan mainly engaged in automobile industry.  Famous enterprises include PSA Peugeot-Citroen, Renault, Carrefour, Societe Generale and the Total-Elf Group. 

 

Yichang, a major city in Hubei, also attracted foreign investment.  In the first half of 2001, the city actually utilized investment of US$64 million.  In the coming years, foreign investment are encouraged to develop in the following sectors:

 

-     Infrastructure facilities such as power plants in Jingman（荊門）, Hanchuan（漢川）, Huangang（環崗）, Ezhou（鄂州）; Yangtze bridge in Jingsha（荆沙）

-     modernisation of large- and medium-sized state-owned enterprises, especially those in textile and automobile spare parts industries

-     Agricultural sector investment

-     Investment in tertiary sectors such as information, financial and insurance businesses.

 

To boost the development of the central and western regions in China, the State Council has granted further tax incentives to foreign-invested enterprises (FIEs) in China.  Under the existing policy, FIEs are entitled to a three-year tax reduction and exemption.  The new policy allows foreign-invested enterprises in the central and western regions to enjoy another three years of preferential tax rate when the current preferential tax period expires.  The tax rate can be further reduced to 10% if an enterprise is proved to export more than 70% of its annual output in terms of value.

 

To reform the existing processing trade system and to go in line with international practice, the Chinese government has decided to set up export processing zones in 15 pilot cities.  Wuhan is selected as one of the cities in this trial program.  Export processing zones are special restricted areas administered by the Customs.  Goods moving in and out of the zone are regarded as imports and exports.  Enterprises concerned with export processing, storage and transportation are allowed to be set up in the zones. 

 

Economic Indicators of Major Cities (1999)

	Population	GDP	Industrial Output	Retail Sales
Cities	('000)	(Rmb bn)	(Rmb bn)	(Rmb bn)
Wuhan       武漢	7,402   (+1.1%)	108.6 (+6.9%)	65.9   (-6.4%)	53.3   (+8.3%)
Xiangfan     襄樊	5,773   (+1.0%)	39.2   (-20.2%)	25.9   (-5.5%)	12.9   (+7.5%)
Jingzhou     荊州	6,421   (+0.9%)	27.9   (-14.2%)	19.3   (-9.8%)	15.5   (+7.6%)
Yichang      宜昌	3,993   (0.0%)	34.6   (-8.9%)	20.2   (-4.7%)	12.6   (+7.7%)
Huangshi   黃石	2,494   (+1.0%)	18.0   (+11.8%)	11.3   (-11.0%)	6.8     (+7.9%)
Huangshi   十堰	3,412   (+0.3%)	16.7   (-10.6%)	23.1   (-8.3%)	6.6     (+3.1%)

Note: Figures in  (   ) represent year-on-year growth             Source:     Hubei Statistical Yearbook

Major Economic & Technological Development Zones (ETDZs)

 

There are three state-level development zones in Hubei, including :

 

1.        Wuhan Economic & Technological Development Zone（武漢經濟技術開發區）

Approved by State Council in April 1993.  Currently, the zone attracted 800 foreign-invested projects with total investment of US$31 billion.  Investments are concentrated in a number of industrial fields including automobile and its components, food, engineering, electronics, bioengineering and light industries. 

 

2.        Wuhan Donghu New Technological Development Zone（武漢東湖高新技術開發區）

Having the reputation of being Central China's Silicon Valley, there are more than 380 foreign-invested enterprises setting up in the zone with total investment of US$680 million so far.  World-famous big companies and consortia have developed their hi-tech industries in the zone such as Xerox Ltd., ESSO Corp from the US, Siemens from Germany, NKF and Philips from the Netherlands, NEC from Japan. 

 

3.        Xiangfan Hi-Tech Development Zone（襄樊高新技術產業開發區）

A state level hi-tech industry development zone which concentrates on optical glass.  The development zone is divided into several development zones.  Dongfeng Automobile Company is situated in the east.  Centres for light industry, textile and chemical industry are located in the west to north.  Commercial and trade centres are established in the south.

 

Other major development zones are located along Hanjiang and major transportation routes. They include Yangluo（陽邏）Economic & Technological Development Zone, Dunkou（沌口）Light Vehicle Development Zone in Wuhan; Gedian（葛店）, Dongshan and Huting Econom­ic and Technological Development Zones in Yichang; Chengnan（城南）Investment Zone in Jingzhou（荊州）and Motors Industry Development Zone in Xiangfan.

 

Also, some development zones are widely located in major cities along Yangtze River.  A bonded zone was approved in Wuhan's Bai­shushan（白滸山）foreign trade port to attract processing activi­ties.  The Wujiashan Taiwanese Investment Zone was opened in 1993 to lure more Taiwanese investments.