An overview of Heavy industry in Guangzhou
Guangzhou is selected as the case city in this report because of its unique geographical and economical position in the world. Among a number of industries in this city, heavy industry plays the most significant role in its economic growth. To provide a better understanding of heavy industry in Guangzhou, this report applies PEST model and also presents both the current challenges and advantages that the heavy industry face. As a typical emerging city, Guangzhou can provide some applications about how to overcome barriers in the process of upgrading industry.
Guangzhou is not only one of the most prominent urban ...view middle of the document...
Industry overview and major trends
In general, heavy industry refers to industrial process that requires more capital and labor and produce heavy end products such as iron, ships, coal etc. It is not easy to enter into heavy industry because of high start-up cost and slow returns relative to light industry. Another trait of heavy industry is low transportability, considering the heavy weight and huge bulk of the raw materials involved in production. It consists three main categories: raw materials industry, manufacturing industry and mining industry. Many countries put heavy industry development as a priority, to foster its total economic output. This trend is more obvious in East Asian regions. With the liberalization of trade and labor force, heavy industry in these countries will face larger and more potential global market. In China, according to Guangdong 12th Five-Year-Plan, the government targets to increase gross industrial output from 47.1% in 2000 to 65% in 2015 by investing on heavy industry. It can not be deny that rapid development of heavy industry has cause serious environmental problem. To seek long-term economic al and ecological benefits, countries have been evolving from low-value heavy industries into more green and high-end heavy industries.
Guangzhou - and unique emerging city
Guangzhou is developing from global low-end factory into technology-driven industry base. As the provincial capital of Guangdong Province, Guangzhou can be considered as an economic and political center in southern China. Due to the early application of Open Door Policy, Guangzhou has developed itself as an important industrial base of Pearl River Delta region with a range of modern light industry and relatively developed heavy industry. There are 40 main categories of industry sectors in China and Guangzhou accounts for 34 that contribute to the national economy significantly. Its GDP grows from 43.09 million RMB in 1978 to 1.3551 trillion RMB in 2012, accounting for 23.3% of the total GDP in the province. Especially, the value of major branches in heavy industry- manufacturing industry, raw materials industry and ship building industry- account for one third of the city’s GDP. With the development of globalization and urbanization, Guangzhou has participated in an industrial restructuring programmed to overcome the unbalanced industrial development and promote the industrial transfer orderly. In recent five years, two remarkable trends have emerged. 1) The city has concentrated on shifting towards heavy and high-tech industries, particularly focusing on manufacturing-based industry. 2) It has put much effort on service sectors to support Guangzhou to be international business center and advanced logistics hub.
Since 90s, the central government has established Guangzhou as Special Economic Zone and Open Coastal city to finance economic development by attracting foreign investment with a series of preferential...