Chinese Business Culture | Which Chinese city has the most factories?

By justchinait
 / 
October 23, 2020
 / 

Guangdong Province is the most economically developed province in China. The administrative region is divided into 21 prefecture-level cities. Among the 21 provincial-administered cities, there is a city called “World Factory”, not Shenzhen, but a city called Dongguan.

Why is Dongguan called the World Factory?

As we all know, China has a lot of factories and the manufacturing industry is relatively developed. Dongguan is the city with the largest number of factories in China. Dongguan’s economic system is a bit special, mainly relying on processing and manufacturing industries, so there are many factories here. In other parts of Guangdong, trade and service are the main industries.

Dongguan has a developed manufacturing industry, and electronic products, toy products, clothing and footwear are sold all over the world. Many Fortune 500 companies have factories in Dongguan or are cooperating with factories in Dongguan. Dongguan is a very important city in the world trade supply chain. An image saying is that the provincial highways from Dongguan to Guangzhou and Shenzhen should not be stuck in traffic for a long time, otherwise the world supply of electronic products will be out of supply or the price will increase.

Everyone knows that there are two types of suppliers: manufacturers and traders. On ALibaba, you will find that most of them are from Shenzhen. But in fact, 90% of these suppliers are traders, and they will order from the Dongguan factory after receiving your order. So in fact, most of the electronic products on the market were born in Dongguan.

China’s top 100 foreign trade cities

“China Customs” magazine released the list of “China’s Top 100 Foreign Trade Cities in 2019”. Among the 297 cities participating in the national evaluation, the top ten star cities on the list are:

Shenzhen, Shanghai, Guangzhou, Dongguan, Xiamen, Suzhou, Zhuhai, Ningbo, Chongqing and Qingdao. Among them, Guangdong occupies 4 of the top ten foreign trade cities nationwide.

It is understood that since the establishment of the “China’s Top 100 Foreign Trade Cities” list in 2008, Dongguan has been among the top 5 in the country for 13 consecutive years.

As a “world factory”, although Dongguan is currently facing the impact of Sino-US economic and trade frictions, its foreign trade performance is still strong, and its position in Guangdong Province and the whole country is still very important.

In the first half of 2019, Dongguan’s foreign trade imports and exports amounted to RMB 633.31 billion, an increase of 6.8% over the same period last year. From the perspective of total foreign trade, Dongguan is lower than Shenzhen’s RMB 757.14 billion in the same period and still ranks second among the 21 cities in Guangdong Province. However, Dongguan’s growth rate is outstanding, surpassing the nation’s 3.9%, Guangdong’s 1.3% and Shenzhen’s 5.1% in the same period.

According to customs calculations, Dongguan’s contribution to Guangdong’s foreign trade growth in the first half of 2019 reached 96.4%. In other words, in the growth of Guangdong’s foreign trade in the first half of the year, RMB 96.4 for every RMB 100 yuan came from Dongguan.

In terms of market structure, Dongguan’s import and export to ASEAN was RMB 83.7 billion, an increase of 22.8%; its import and export to the United States was RMB 83.42 billion, an increase of 6.2%; and its import and export to the EU was RMB 81.08 billion, an increase of 13.2%. In addition, imports and exports to countries along the “Belt and Road” were RMB 138.16 billion, an increase of 20.8%.

In terms of product structure, mechanical and electronic products represented by mobile phones have become the main export products of Dongguan. In the first half of 2019, Dongguan exported RMB 291.97 billion of mechanical and electrical products, an increase of 12.4%, accounting for 76.2% of the total export value of Dongguan in the same period. Among them, the export of mobile phones was CNY 64.64 billion, an increase of 7.8%.

1 out of every 6 smartphones in the world is produced in Dongguan

The export of smart phones, tablets and accessories is an important part of Dongguan’s export goods. At present, Dongguan has gathered hundreds of smart phone and tablet manufacturers. Samsung, Apple, Huawei, Xiaomi, OPPO and other well-known brands of smart phones, tablets and accessories at home and abroad have production bases in Dongguan.

The shipment of smart phones in Dongguan in 2018 was 368 million units, accounting for approximately 26.2% of the global (1.405 billion units) shipments. One out of every four mobile phones in the world came from Dongguan.

With a strong manufacturing industry and a complete industrial system, Dongguan is one of the largest manufacturing bases in the world.

 

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