The fourth 3 trillion city was born

Text: Kaifeng

3 trillion is becoming a new rise in urban competition

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According to the two sessions of the Guangzhou Municipal People's Congress (CPPCC), Guangzhou's GDP is expected to exceed 3 trillion yuan in 2023, and the total retail sales of consumer goods and the total import and export value of goods will both exceed 1 trillion yuan for the third consecutive year.

Coincidentally, according to the previous New Year's message released by Chongqing's official, in 2023, Chongqing's total economic output will exceed 3 trillion yuan for the first time.

This means that after Shanghai, Beijing and Shenzhen, Guangzhou and Chongqing have joined the 3 trillion club, and the mainland 3 trillion club has been expanded to 5 seats.

What will Guangzhou and Chongqing rely on to advance? Who can go further?

01

Guangzhou is making every effort to return to the fourth city of the economy.

In the past year, without the impact of unexpected factors such as the epidemic, the economic competition of major cities has returned to fundamentals, and the economy has once again entered a white-hot stage.

Since 2023, Guangzhou has won several "firsts" with considerable gold content.

The first "first" is that the passenger flow of the airport and high-speed rail both ranks first in the country, highlighting the background color of the "traffic city".

Looking at the airport first, Guangzhou Baiyun Airport will have a passenger throughput of 63.17 million passengers in 2023, surpassing Shanghai Pudong Airport, Beijing International Airport, and Hong Kong International Airport, and ranking among the largest airports in the country for four consecutive years.

Looking at the high-speed rail, since 2023, Guangzhou South Railway Station has sent a total of 180 million passengers, with an average daily passenger flow of more than 500,000 passengers, ranking first in the country for many years.

Not only that, the total mileage of Guangzhou Metro ranks third in the country, and the passenger flow intensity has ranked first in the country for many times.

Civil aviation, railways, and subways go hand in hand, jointly building Guangzhou's comprehensive transportation advantages, and also becoming the ballast stone for Guangzhou to become an international gateway hub.

The second "first" refers to the largest increase in the number of unicorn enterprises in Guangzhou in the country, reflecting the progress of economic and industrial transformation.

According to the "2023 Global Unicorn List" released by the Hurun Research Institute, Guangzhou ranks eighth in the world with 22 unicorns, a net increase of 12 unicorns compared with the previous year, and the growth rate ranks first in the world.

A unicorn enterprise in Guangzhou, covering a number of new tracks.

There are not only Shein, which is the leader of cross-sea e-commerce, but also GAC Aion, the leader of new energy vehicles, Pony.ai and Wenyuan, the pioneers in the field of autonomous driving, and Yuexin Semiconductor, the leader of integrated circuits......

As we all know, Guangzhou has automobiles, electronics, and petrochemicals as its three traditional pillar industries, and the traditional industries are too heavy and the emerging industries are insufficient, which once became a constraint to Guangzhou's long-term development.

Now, the tide has turned. With the establishment of Guangzhou's strategy of "industry first, strong manufacturing city", emerging industries have shown a vigorous development trend, and unicorns are the best proof of this.

The third "first" is to jointly promote the 5 trillion-level national metropolitan area with Shenzhen, and use the power of the metropolitan area to drive regional development.

A few days ago, Guangdong Province issued the development plan of Guangzhou and Shenzhen metropolitan areas, which is the first approved first-tier city metropolitan area in the country and the only approved 5 trillion metropolitan area.

The metropolitan area is intended to break the administrative barriers between different cities and promote the common development of the region through the co-urbanization of transportation, public services, planning and industry, which is an alternative choice under the resistance of the strong provincial capital model.

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In June last year, Guangzhou proposed to take out the vigor and vigor of reform and opening up more than 40 years ago, hold high the banner of reform, and ignite the passion for the second entrepreneurship...... Take new responsibilities and new actions to "recreate a new Guangzhou".

The second entrepreneurship and the rebuilding of a new Guangzhou can be said to have a long way to go, but it is also the only choice for Guangzhou to return to the fourth and third cities of the economy.

02

Chongqing, why is it so fierce?

A few years ago, Chongqing was still competing with Suzhou and Tianjin for the position of the fifth city in terms of GDP, but now it has been fighting for the fourth city with Guangzhou.

In fact, Chongqing's economic strength has always been not weak. According to Kaifeng's book "The Great Changes in China's Cities", Chongqing was one of the important old industrial bases in the era of planned economy, and its total GDP once ranked among the top four in the country in the 1980s.

Later, with the help of reform and opening up, coastal cities such as Guangzhou, Shenzhen, and Suzhou came from behind, gradually surpassing the strong provincial capitals in the central and western regions, but Chongqing has never left the top ten city matrix.

In recent years, with the advancement of strategies such as the large-scale development of the western region, Chongqing has ushered in a period of rapid development.

The first is big investment.

In the early years, Chongqing seized the historical opportunity of the large-scale development of the western region and boosted its GDP through a steady stream of transfer payments and a large amount of investment.

In the past decade, Chongqing's fixed asset investment accounted for about 80% of GDP, and reached a peak of 89.48% in 2015, while Guangzhou and Shenzhen accounted for only 20%-30%.

Nowadays, in addition to investment, industry has begun to rise, coupled with the comprehensive tilt of the national strategy to the fourth pole of Chengdu and Chongqing, Chongqing's development has entered the fast lane.

In fact, Chongqing was originally an old industrial base, and the foundation had been laid during the period of planned economy.

Whether it is the investment tilt of national key projects during the First and Second Five-Year Plan periods, or the relocation of a large number of factories and technicians from the eastern and northeastern regions during the "third-line construction" period in the 1960s, Chongqing has laid a strong industrial foundation.

In recent years, after more than 10 years of cultivation, Chongqing's two pillar industries of automobiles and electronics are thriving, both pointing to trillion-level industries.

According to the plan, by 2027, Chongqing will build two trillion-level industrial clusters of intelligent networked new energy vehicles and electronic information manufacturing, and promote the formation of three 500-billion-level clusters of intelligent equipment and intelligent manufacturing, food and agricultural product processing, and software information service industry clusters, driving the economy to leap again.

The rise of these industries has brought new growth potential energy to Chongqing after being driven by a large amount of investment, thus embarking on a completely different development path from Tianjin.

It should not be overlooked that Chongqing is also the place where the national strategy is most inclined and one of the main beneficiaries of transfer payments.

From the development of the western region to the new land-sea corridor in the western region, from the national central city to the international comprehensive transportation hub city, from the Chengdu-Chongqing twin-city economic circle to the fourth pole of national transportation, from the Belt and Road Initiative to the Yangtze River Economic Belt, and then to the strategic fulcrum of the domestic circulation...... In terms of policy intensity, Chongqing is second only to Beijing, Shanghai and Shenzhen.

From the point of view of transfer payments, as a western province, Chongqing has always been a beneficiary of fiscal transfer payments, with subsidies of more than 200 billion yuan from the central government every year, while Guangzhou is the main force of net contribution.

It can be seen that Chongqing's policy intensity is second only to Beijing, Shanghai and Shenzhen, and far exceeds that of other cities, including Guangzhou.

03

Guangzhou, Chongqing, who is the fourth economic city?

One of the unavoidable controversies in discussing this topic is whether Chongqing is a province or a city, and whether it is directly comparable with cities such as Guangzhou, Shenzhen, Chengdu and Wuhan.

Not to mention that Chongqing itself is a provincial-level municipality, while Guangzhou, Shenzhen, Chengdu and Hangzhou are only sub-provincial-level cities, while Suzhou, Zhengzhou, Changsha and Hefei are only ordinary prefecture-level cities.

There is no doubt that Beijing, Shanghai and Tianjin are regarded as cities, because the urbanization rate of the three places is more than 80%, and the highest in Shanghai is as high as 88.1%, and there are almost no rural and county areas.

In contrast, Chongqing is almost the same as a medium-sized province in terms of urban area, administrative division, and population size.

According to the latest yearbook, Chongqing has 38 districts and counties, with a permanent population of more than 32 million and a city area of more than 80,000 square kilometers, which is 10 times that of Guangzhou and 20 times that of Shenzhen.

The most remote counties in Chongqing, Wushan and Fengjie counties, are more than 400 kilometers away from the central city, which is obviously beyond the scope of normal cities.

According to Kaifeng's book "The Great Changes in China's Cities", cities in mainland China are different from those in the world, and are more of a concept of administrative divisions, with both "city" parts and a large number of counties and villages.

Therefore, when defining the economic energy level and the scale level of the city, the main city or urban area can be used as the definition object, so that there is horizontal comparability.

In this regard, it is more appropriate to use the main urban area of Chongqing as an equivalent comparison.

Not long ago, Chongqing's main urban area ushered in an expansion, from the traditional center of 9 districts to 21 districts, covering all areas except the Three Gorges Reservoir area and the Wuling Mountains.

From the perspective of the 9 central districts, the total GDP of the central urban area of Chongqing exceeds 1 trillion yuan, and the permanent population is 10.47 million, which belongs to the most core zone of Chongqing.

From the perspective of the main metropolitan area, the total GDP of the main metropolitan area of Chongqing exceeds 2.1 trillion yuan, and the permanent population exceeds 21 million, which is basically the same as Chengdu, and belongs to a veritable strong second-tier city.

Of course, there is still a certain gap between Suzhou and Guangzhou.

04

Compared with the dispute between provinces and cities, the biggest difference between Guangzhou and Chongqing lies in fiscal transfer payments.

The total GDP of Guangzhou and Chongqing is basically at the same level, but the permanent population of Guangzhou is less than half of Chongqing, and the per capita GDP is more than twice that of Chongqing.

Not only per capita GDP, but also in terms of total capital, the number of listed companies, the number of Fortune 500 and China's top 500 enterprises, unicorn enterprises, airports, double first-class universities, top 100 hospitals and other comprehensive indicators, Guangzhou has an overwhelming leading edge.

However, the biggest difference between the two places lies in the fiscal system.

Guangzhou is one of the main contributors to fiscal transfers, while Chongqing is the main beneficiary of fiscal transfers, and some regions are still receiving assistance from Shandong.

Guangzhou is a typical three-level tax system, and the tax revenue must not only be handed over to the central government, but also shared with the provincial level, while Shenzhen, Chongqing, Hangzhou and other places are two-level tax system, which leads to the overall financial resources of Guangzhou.

Guangzhou is the city with the lowest tax retention rate.

According to the data, in 2022, the total tax revenue of Guangzhou will reach 558.3 billion yuan, deducting the part collected by the customs is 445.5 billion yuan, but the tax revenue left to the local area is only 124.5 billion yuan, even if the return part is added, the retention rate is less than 4%.

On the one hand, the emergence of this phenomenon is due to the fact that Guangdong has to bear a large number of national transfer payments, and is the largest province in terms of net financial contribution, and its net tax payment is close to that of Jiangsu and Zhejiang provinces combined.

On the other hand, although Guangdong's economy is strong, regional disparities still exist, and the east, west and north of Guangdong still need financial support.

Since Shenzhen is a city with separate planning, its finances are hardly shared with the provincial level, so this heavy responsibility can only fall on the economically strong cities such as Guangzhou, Foshan and Dongguan, which is discussed in detail in the book "The Great Changes in Chinese Cities".

In contrast, as a municipality directly under the central government, Chongqing has a two-tier tax system, which is only divided with the central government, and enjoys a large amount of transfer payments, and has far more financial resources than cities such as Guangzhou.

According to the latest final account report, in 2022, Chongqing's general public budget revenue will be 210.3 billion yuan, of which tax revenue will be 127.1 billion yuan, and the revenue from central subsidies will be as high as 230.9 billion yuan, which is 1.8 times the tax revenue.

Not only that, many districts and counties in Chongqing are also receiving counterpart assistance from Shandong.

According to public reports, since 2010, 14 cities in Shandong have paired up to help 14 national-level poverty-stricken districts and counties in Chongqing.

According to statistics, during the period of poverty alleviation, Shandong allocated a total of 2.19 billion yuan of financial assistance funds to Chongqing, and entered the period of consolidating the achievements of poverty alleviation, Shandong further strengthened financial guarantees, and invested a total of 1.456 billion yuan in financial assistance funds in 2021 and 2022.

When Chongqing became the fourth city in terms of GDP, the controversy of "why Shandong should help Chongqing" began to appear.

Behind this, it is not unrelated to the uneven development of Chongqing itself, which has the main urban area of the rich province and the underdeveloped Three Gorges Reservoir area and the Wuling mountain area, which needs support from the whole country.

Of course, once Chongqing's economy continues to grow bigger and stronger, and it has its own fiscal hematopoietic capacity, it may be time to adjust the transfer payment pattern.