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Henan: Market Profile

Major Economic Indicators

Economic Indicators2016Jan-Nov 2017
ValueGrowth
(%, y-o-y)
ValueGrowth
(%, y-o-y)
Gross Domestic Product (RMB bn)4,047.28.113,289.738.11
Per Capita GDP42,5757.61
Added Value Output
- Primary industry  (RMB bn)428.64.21358.334.41
- Secondary industry (RMB bn)1,927.67.311,553.937.61
- Tertiary industry (RMB bn)1,691.010.311,377.539.81
Value-added Industrial Output2 (RMB bn)8.018.11
Fixed-assets Investment (RMB bn)3,975.413.73,945.810.6
Retail Sales (RMB bn)1,761.811.91,776.311.9
Inflation (Consumer Price Index, %)1.91.3
Exports (US$ bn)42.8-0.638.93.1
- By foreign-invested enterprises (US$ bn)29.40.024.6-4.6
Imports (US$ bn)28.4-7.626.74.2
- By foreign-invested enterprises (US$ bn)20.1
-11.419.16.2
Utilised Foreign Direct Investment (US$ bn)17.05.6

Notes:
1 In real terms
2 For all state-owned enterprises and other forms with annual sales over RMB20 million
3 Jan-Sep 2017

Sources: Henan Statistical Yearbook 2017, Henan Statistical Bureau, China’s Customs Statistics 12.2016, 11.2017

 

General Background

Henan has a total area of 166,000 sq km. Total population stood at 107.88 million at the end of 2016. Zhengzhou, the capital city of Henan province, is an important railway hub of China.

Henan is rich in mineral resources. Its reserves of molybdenum, marble trona, asbestos, aluminum, natural gas, cesium, bauxite, coal, perlite and refractory clay are among the largest in China. Zhongyuan Oilfield (中原油田) is one of the major oilfields and Pingdingshan Coal Mine is a major coal mine in China. Henan is also a major production base of aluminum oxide.

Industries

Henan is one of the country's main commercial crops production areas. Major agricultural products include cotton, peanuts, mushrooms, tobacco and fruits. Henan has developed into an important food processing base in China, producing meat, frozen food, instant noodles, biscuits and seasonings, etc.

Henan’s industry is dominated by heavy industry, which accounted for 66% of the total revenue from principal business of the industrial sector in 2016. The tertiary sector has been developing rapidly in Henan with its share in GDP increased gradually since 2008.

 

Composition of GDP (%)

 200020082016
Primary24.914.510.6
Secondary43.855.947.6
Tertiary31.329.741.8

Source: Henan Statistical Yearbook, 2017


Value-added Share of High-growth Industries (2016)


% share of industrial value-added
High-growth Industries

Equipment manufacturing16.6
Food industry15.6
Modern furniture4.2
Automobile and parts4.1
Electronic information4.0
Traditional industries
Building materials12.5
Textile10.4
Metallurgical industry7.8
Chemical7.0

Source: Henan Statistical Yearbook 2017

 

Electronics and communication equipment is an area of fast growth. In 2016, the value-added of high-tech industry grew by 15.5%, accounting for 8.7% of the total value-added of industries. In 2016, exports of high-tech products grew by 8.7% to US$28.3 billion, accounting for 66% of total exports. Foxconn from Taiwan has established its assembly plant of mobile phones in Zhengzhou of Henan since 2010, stimulating the growth of related industries.

Tourism

As the birthplace of the Han people, Henan has many cultural heritages and scenic spots. There are three capital cities of ancient China in the province: Luoyang, Kaifeng and Anyang, all of which have many sites of great historical value, e.g. the Longmen Grottoes is one of the World Heritage Sites.

In 2016, Henan received 580 million (+12.4%) domestic tourists with tourism receipts of RMB570.3 billion (+14.5%) while overseas tourists grew by 9.6% to 2.94 million with tourism receipts of US$895 million (+5.4%).

Foreign Trade

Exports of machinery, electric equipment & accessories accounted for about 75.6% of Henan’s total exports in 2016. Mobile phone is one of the leading export items, accounting for 63% of total exports.

With more relocation of manufacturing activities from the coastal region in recent years, processing trade accounted for 68% of total exports in 2016, up from 19% in 2010. Foreign-invested enterprises accounted for 68.8% of exports in 2016, up from 24.3% in 2010.

The US was the leading export market in 2016 followed by Hong Kong. In 2016, exports to Hong Kong reached US$2 billion, accounting for 4.8% of the total exports.

Major imports were electronic parts and components, electric equipment products, chemicals, plastics & related products, minerals and base metals. Major import sources are South Korea, Taiwan, Japan and Australia.

Foreign Investment

Inflows of FDI have recorded marked growth in recent years. In 2016, investment from other provinces in China grew by 7.9% to RMB843.8 billion.

 

Chart: Utilised FDI of Henan
Chart: Utilised FDI of Henan

 

Foreign direct investments mainly engaged in manufacturing (61.5% of total investment in 2016) and real estate (10.4%). Industries of high efficiency and low consumption of energy are encouraged, and more FDI are expected to flow into services sectors.

Hong Kong is the largest source of foreign direct investment in Henan. In 2016, actual investment from Hong Kong amounted to US$9.96 billion, accounting for 58.6% of the total. Other major sources of investment included Singapore, Taiwan and the US.

Consumer Market

Major consumer markets are located in Zhengzhou, Nanyang and Luoyang. In 2016, annual per capita disposal income of urban households reached RMB27,233 (+6.5%).

Zhengzhou is traditionally a major distribution centre in central China. It was approved by the state to be the pilot centre for distribution reforms. Major retail operators include Jinboda Commercial Mansion (金博大), Denis Department Store (丹尼斯百貨), Dashang Group New Mart Shopping Plaza (大商集團新瑪特購物廣場), Carrefour and Walmart.

 

Composition of Per Capita Expenditure of Urban Household (%)

 20002016
Food36.228.0
Clothing12.09.7
Household articles8.27.9
Medicine & medical services7.38.4
Transportation & communications6.411.0
Recreation, cultural & education10.611.5
Residence14.320.7

Source: Henan Statistical Yearbook, 2017


Economic Indicators of Major Cities (2016)

CitiesGDP
(RMB bn)
Per Capita GDP
(RMB)
Retail Sales
(RMB bn)

Industrial enterprises* business revenue
(RMB mn)
Zhengzhou 鄭州 811.484,113366.61,415.8
Luoyang 洛陽 382.056,410180.7746.9
Nanyang 南陽 311.531,010175.6451.4
Xuchang 許昌 237.854,52279.4629.6
Xinxiang 新鄉 216.737,80586.2448.0
Jiaozuo 焦作 209.559,18369.9569.2
Kaifeng 開封 175.538,61984.1300.2

Note: * For all state-owned enterprises and other forms with annual sales over RMB20 million
Source: Henan Statistical Yearbook 2017

 

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