We define the explanation why international corporations ought to contemplate investing in Hangzhou, a number one industrial, technological and digital hub within the Yangtze River Delta area of China.

Hangzhou, the capital of Zhejiang province, has turn out to be world well-known because it hosted the G20 summit in 2016. With decrease workplace setup prices than Shanghai, aggressive authorities tax incentives and a robust community native IT corporations, Hangzhou is a metropolis that holds nice attraction for traders.

As one of the crucial affluent cities within the Yangtze River Delta, positioned in Hangzhou Bay between Shanghai and Ningbo, Hangzhou’s GDP accounts for almost 25% of the financial output of Zhejiang Province. Alibaba, the Chinese language e-commerce and tech big, and Wahaha, the nation’s largest beverage firm, are each headquartered in Hangzhou.

Hangzhou Financial Profile

In 2020, Hangzhou’s GDP reached 1,610.6 billion RMB (about 245 billion US {dollars}), making it the fourth provincial capital with the biggest GDP in mainland China. From a perspective, that is concerning the measurement of the financial system of the Czech Republic or Portugal. Hangzhou can be one of many high three cities within the Yangtze River Delta area by way of GDP, simply behind Shanghai and Suzhou.

Situated within the wealthiest area of jap China, Hangzhou’s per capita GDP is over $ 22,000, which is similar to the extent of high-income international locations, in keeping with the World Financial institution. In 2020, complete retail gross sales of client items in Hangzhou reached 597.3 billion RMB (about 91 billion US {dollars}), additionally rating third amongst cities within the Yangtze Delta after Shanghai and Suzhou.

Overseas commerce and funding

In 2020, Hangzhou recorded important development in international commerce. Its imports and exports complete RMB 593.4 billion (about US $ 90 billion), up 5.9 p.c. Exports contributed 369.3 billion RMB (about US $ 56 billion) and elevated by 2.1 p.c and imports contributed 224.1 billion RMB (about US $ 34 billion), in 12.9 p.c enhance.

Hangzhou’s exports to Belt and Highway Initiative international locations amounted to 117 billion RMB (about US $ 18 billion), up 31.7%. Exports to the US and 28 EU international locations elevated by 5.7% and eight.5% respectively. Exports of companies totaled US $ 13.8 billion, up 10.8 p.c.

As an e-commerce hub, Hangzhou’s imports and exports by means of cross-border e-commerce alone totaled 108.4 billion RMB (about 16.5 billion US {dollars}), up 13.9% , or about 18% of the town’s complete commerce.

The town made good use of international capital, attracting 804 foreign-funded tasks, of which 98 tasks had a complete funding of over US $ 30 million. Precise use of international funding by Hangzhou amounted to US $ 7.2 billion, up 17.5%. By the top of 2020, Hangzhou had acquired 2019 foreign-funded tasks from 222 Fortune 500 corporations.

Based on information from the Chinese language Ministry of Commerce, the international capital really utilized in Hangzhou is greater than 45% of that of Zhejiang province.

Spend money on Hangzhou: development of the digital financial system, high-tech industries

Hangzhou’s digital financial system is the primary contributor to its total financial system. In 2020, main digital industries added a worth of 429 billion RMB ($ 65.5 billion), up 13.3% and contributing 26.6% of its complete GDP, in comparison with 24.7% in 2019.

Development in associated sectors similar to digital data product manufacturing, data software program and companies, digital content material and robotics was 14.7%, 12.9%, 12.7% and 12 , 3%, respectively.

The rise of Hangzhou’s tech trade owes a lot to being the birthplace of Chinese language e-commerce big Alibaba, which owns e-commerce web sites Taobao and Tmall, digital monetary companies big Ant Group which owns Alipay. and cloud computing firm Aliyun.

The key Chinese language IT corporations primarily based in Hangzhou, similar to Aliyun, Hikvision, Dahua Know-how and Uniview, have important market share in international markets. Of word, Hikvision and Dahua Know-how are among the many Chinese language high-tech corporations which are sanctioned and blacklisted by the US amid the technological rivalry between the US and China.

As a metropolis well-known for its high-tech sector, the Hangzhou authorities actively promotes its good metropolis program. Alibaba and 13 different corporations are presently working with the native authorities on public-private partnerships (PPP) to create good service supply techniques for the town.

Some examples:

  • Hangzhou on Palm, the world’s largest public bicycle system primarily based on clever purposes, has 3,800 bicycles parked in additional than 2,500 mooring factors.
  • the Hangzhou Metropolis Mind, led by the Alibaba group, goals to construct “a community”, “a cloud”, “a knowledge financial institution” and “a nerve middle”, which processes greater than 7.6 million API (Utility Programming Interface) calls and 120 million items of collaborative information every single day, to supply Hangzhou options for digitizing the governance of enormous cities.

The place to find your funding: Hangzhou growth zones

Hangzhou now has 9 state-level growth zones and 4 provincial-level growth zones. Hangzhou Excessive-Tech Growth Zone (Binjiang) and Hangzhou Financial and Technological Growth Zone are among the many first within the Complete Rating of Nationwide Excessive-Tech Zones and within the Annual Evaluation of Nationwide Financial Growth Zones.

Hangzhou Excessive-Tech Trade Growth Zone is residence to greater than two-thirds of the town’s expertise corporations. Notable traders on this space embrace Alibaba, Microsoft, IBM, Nokia, Panasonic, and Mitsubishi.

In April 2019, Hangzhou established the Qiantang New Space, which incorporates Hangzhou Dajiangdong Industrial Cluster Zone and Hangzhou Financial and Technological Growth Zone.

With the goal of changing into a world-class clever manufacturing industrial middle, Qiantang New Space has attracted main manufacturers like Pfizer, Bayer, Geely and Gree from varied superior manufacturing industries, together with semiconductors, life and well being, new supplies, aerospace and aviation, and clever auto and clever tools industries.

One other key growth space is the Yuhang Future Science and Know-how Metropolis. On April 28, 2020, Yuhang Future Science and Know-how Metropolis adopted its first dwell e-commerce trade base, aimed toward boosting Hangzhou’s e-commerce financial system.

To encourage companies to find in Hangzhou and its growth zones, the native authorities is providing tax breaks for high-tech corporations, with extra incentives for web start-ups, together with housing subsidies for entrepreneurs. and occasions to advertise personal and international funding to help start-ups.

For extra data on investing in Hangzhou or to entry the preferential insurance policies supplied by the native authorities, please contact us at China@dezshira.com.

About Us

China Briefing is written and produced by Dezan Shira and associates. The follow assists international traders in China and has performed so since 1992 by means of workplaces in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the corporate for help in China at china@dezshira.com.

Dezan Shira & Associates has workplaces in Vietnam, Indonesia, Singapore, United States, Germany, Italy, India, and Russia, along with our business analysis amenities alongside the Belt and Highway Initiative. We even have companion corporations that assist international traders to The Philippines, Malaysia, Thailand, Bangladesh.

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