Guangdong GDP leads nation with economic expands 18.6% in Q1

South China's Guangdong Province turned in an impressive first-quarter economic performance, with its GDP growing 18.6 percent year-on-year to 2.71 trillion yuan ($418 billion), buoyed by rising global demand for Chinese goods, government policy support and a domestic consumption rebound.

(Photo / Nanfang Daily)

As one of China's economic engines, Guangdong's return to growth after the nation's quick production resumption has fortified its role as a major provider of commodities from home appliances to personal protective equipment amid the coronavirus outbreak.

In the first-quarter report released by the Guangdong government on Wednesday, the province's total trade hit 1.83 trillion yuan, up 33.4 percent year-on-year which is 4.2 percentage points higher than the national average growth rate of 29.2 percent.

With the global pandemic situation remaining uncertain, disease prevention-related industries in Guangdong maintained high growth, with the pharmaceutical sector up 34.0 percent year-on-year and the chemical fiber manufacturing sector up 35.5 percent.

Among the traditional manufacturing industries, investment in household electric appliance manufacturing grew fast, up 77.4 percent, with an average growth of 43.5 percent over two years, in line with rising demand for home appliances worldwide.

In the context of increasing global demand for Chinese products, Guangdong's port activity grew rapidly, with cargo throughput up 16.4 percent, Wednesday's report said.

"Driven by resilient demand for Chinese goods and government efforts to stabilize foreign trade, Guangdong's economic and trade structure is constantly being optimized," Li Youhuan, a research fellow with Guangdong University of Finance & Economics, told the Global Times on Wednesday, predicting further growth in the second quarter.

The Guangdong government has pledged to increase incentives for manufacturing investment, promote the development of scientific and technological innovation platforms, and provide credit support for some factories, open data shows.

While the growth trend was within expectations in the first quarter, experts said that Guangdong's foreign trade is facing some challenges in the second quarter as the driving effect of the export of pandemic prevention materials is weakened.

"Some remaining issues such as soaring commodity prices and the continued monetary easing policy of the US Federal Reserve call for more attention," said Li.

To contain the possible external impact, Li said that settlements using the yuan should be increased to protect domestic companies' revenues when trading with their business partners overseas.