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Henan: Market Profile

Major Economic Indicators

Economic Indicators20152016
ValueGrowth
(%, y-o-y)
ValueGrowth
(%, y-o-y)
Gross Domestic Product (RMB bn)3,700.28.314,016.0
8.11
Per Capita GDP
39,1237.9142,247
7.61
Added Value Output
- Primary industry  (RMB bn)420.94.41428.6
4.21
- Secondary industry (RMB bn)1,791.77.711,905.5
 7.51
- Tertiary industry (RMB bn)1,487.510.911,681.89.91
Value-added Industrial Output2 (RMB bn)8.61 8.01
Fixed-assets Investment (RMB bn)3,495.1
16.53,975.4
13.7
Retail Sales (RMB bn)1,574.0
12.41,761.8
11.9
Inflation (Consumer Price Index, %)1.31.9
Exports (US$ bn)43.1
9.4
42.8
-0.6
- By foreign-invested enterprises (US$ bn)29.4
20.1
29.4
0.0
Imports (US$ bn)30.8
20.2
28.4
-7.6
- By foreign-invested enterprises (US$ bn)22.6
17.5
20.1
-11.4
Utilised Foreign Direct Investment (US$ bn)16.1
7.8

Notes:
1 In real terms
2 For all state-owned enterprises and other forms with annual sales over RMB20 million
Sources: Henan Statistical Yearbook 2016, Henan Statistical Bureau, China’s Customs Statistics 12.2015, 12.2016

 

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. The 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 67% of the total revenue from principal business of the industrial sector in 2015. The tertiary sector has been developing rapidly in Henan with its share in GDP increased gradually since 2008.

Composition of GDP (%)

 200020082016
Primary24.9
14.5
10.7
Secondary43.8
55.9
47.4
Tertiary31.329.7
41.9

Source: Henan Statistical Yearbook, 2016


Value-added Share of High-growth Industries (2015)


% share of value-added industrial output
High-growth Industries

Equipment manufacturing16.0
Food industry15.8
Electronic information4.3
Modern furniture4.0
Automobile and parts3.8
Traditional industries

Building materials12.9
Textile10.2
Metallurgical industry8.0
Chemical6.6

Source: Henan Statistical Yearbook 2016

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$28.2 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 2015, Henan received 516 million (+13.1%) domestic tourists with tourism receipts of RMB498.2 billion (+15.3%) while overseas tourists grew by 18.1% to 2.68 million with tourism receipts of US$849 million (+17.1%).

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 68.7% of exports in 2016, up from 24.3% in 2010.

The US was the leading export market in 2015 followed by Hong Kong. In 2015, exports to Hong Kong reached US$2.7 billion, accounting for 6.7% 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 (65% of total investment in 2015) and real estate (8.4%). 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 2015, actual investment from Hong Kong amounted to US$10.15 billion, accounting for 63.1% of the total. Other major sources of investment included Taiwan, the US and Singapore.

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 (%)

 20002015
Food36.2
31.2
Clothing12.0
11.8
Household articles8.2
9.0
Medicine & medical services7.3
8.9
Transportation & communications6.4
12.2
Recreation, cultural & education10.613.1
Residence14.3
10.2

Source: Henan Statistical Yearbook, 2016


Economic Indicators of Major Cities (2015)

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

Industrial enterprises* business revenue
(RMB mn)
Zhengzhou 鄭州 731.2
77,179329.51,358.7
Luoyang 洛陽 346.9
51,696160.5672.3
Nanyang 南陽 286.7
28,653157.0417.6
Xuchang 許昌 217.1
50,16270.7539.5
Xinxiang 新鄉 197.5
34,56277.8415.7
Jiaozuo 焦作 192.6
54,59062.5513.9
Kaifeng 開封 160.6
35,32674.7270.1

Note: * For all state-owned enterprises and other forms with annual sales over RMB20 million
Source: Henan Statistical Yearbook 2016

 

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