General

"At present, the changes of the century and the epidemic situation of the century are intertwined. The changes of the world, the times and the history are unfolding in an unprecedented way. International trade has entered a period of turbulence and transformation. China's economy is now facing downward pressure, which is also part of the overall global change. From the perspective of the global change, there are two basic characteristics: the first is that not only domestic demand is insufficient, but also global total demand is insufficient. The second is that It is the pressure of domestic real estate transformation, and the momentum of domestic demand is changing. " Shen Minggao, the global chief economist of GF Securities, said at the International Financial Forum (IFF) Great Bay Area Report held on August 29 that the changes in domestic demand and the changes in the world combined to form the current macroeconomic situation. He believes that such an environment is also the potential of manufacturing upgrading, and the next decade is also the key decade for Guangdong, Hong Kong and Macao Bay Area to give full play to the advantages and potential of manufacturing industry.

From the perspective of the global economic situation, since the end of World War II, the rise of countries has not broken the cycle of power. The global economy generally fluctuates cyclically. The 10-year US bond yield has gone through a complete cycle of about 80 years. During this period, the United States has experienced seven significant recessions and long recoveries. The average duration of the recession is 10 months, and the average duration of the recovery and expansion is 63 months. As far as the developed economies are concerned, their importance to global growth has declined significantly and may continue to decline. In terms of consumption, the proportion of residents' consumption in developed economies in the G20 has dropped from more than 86% before 2004 to 70.5% in 2021. In terms of imports from various countries, the proportion of imports from the United States in the world has dropped from 18.9% to 13%, and that from Germany has dropped from 10.7% to 6.3%. The proportion of imports of capital goods from developed countries has been low for a long time. Such growth has a limited impact on the upgrading of manufacturing industries in emerging markets.

From the perspective of the domestic economic situation, China's post-real estate economic period is coming. Before the Asian financial crisis, China's economic growth was relatively independent of exports and the real estate industry. After China's accession to the WTO, China's export growth rate was faster than the nominal GDP growth rate for six consecutive years, with an annual average of 12.9 percentage points higher. Since 1998, the growth rate of real estate investment has been higher than that of nominal GDP for 17 consecutive years, with an average annual growth rate of 9.1 percentage points.

"Export and real estate are the two major growth engines of China, and the development of manufacturing industry is also one of the main driving forces of China's growth, but its growth is highly overlapping with the cycle of export and real estate. Although there is still much room for urbanization in China, the era of unconventional development of real estate and its chain as the main driving force of China's growth may be nearing the end." Shen Minggao believes that China is about to enter the post-real estate economic period, The obvious signs include: first, the growth rate of real estate investment continues to be lower than the nominal GDP growth rate; Second, the proportion of China's housing investment in GDP is likely to decline, and it will be close to the peak level of 8% in major countries.

In Shen Minggao's view, the logic of China's economic growth has changed. It is necessary to appropriately de-property, grasp the new opportunities of direct financing in the credit downward cycle, and improve the ability of asset disposal business in distress. In the future, it is necessary to focus on large consumption, layout long-board industries, and invest in enterprises with a long industrial chain, including industries that can take advantage of scale advantages, innovation advantages, or both.

"The top ten industries in the world are ranked according to their market value estimation, including financial services, construction, real estate, e-commerce, life and health insurance, IT, food, oil and gas, automobile and telecommunications. Among them, IT and automobile have both advantages of race track and industry scale." In Shen Minggao's view, in the macro environment of insufficient international total demand and domestic real estate momentum transformation, the proportion of manufacturing industry in GDP should be maintained, It has become an important opportunity and challenge for China's economic development.

In this regard, the construction of the Greater Bay Area of Guangdong, Hong Kong and Macao plays an important role. Shen Minggao analyzed that the main advantage of manufacturing industry in Guangdong-Hong Kong-Macao Greater Bay Area lies in the downstream, and the proportion of midstream manufacturing industry is low, and whether the midstream manufacturing industry can rise will directly affect the international trade competitiveness of manufacturing industry in Guangdong-Hong Kong-Macao Greater Bay Area. In terms of the number of scientific researchers and the amount of research and development investment, Shenzhen in the Greater Bay Area of Guangdong, Hong Kong and Macao has taken the lead in the world and is the potential of manufacturing upgrading in the post-real estate era.

Obviously, the country and the cities in the Greater Bay Area of Guangdong, Hong Kong and Macao have recognized this.

In June of this year, the State Council issued the General Plan for Guangzhou Nansha to Deepen the Comprehensive Cooperation between Guangdong, Hong Kong and Macao Facing the World, which clearly supported the building of Nansha into a major strategic platform based on the Bay Area, cooperating with Hong Kong and Macao, and facing the world. Nansha has become an important growth pole for Guangzhou's development. As one of the regions with the highest degree of openness and the strongest economic vitality in China, the Greater Bay Area of Guangdong, Hong Kong and Macao bears the important mission of enterprises in the Greater Bay Area of Guangdong, Hong Kong and Macao to transform to intelligent manufacturing, and has an important strategic position in the overall development of the country to enhance the core competitiveness of the manufacturing industry.

In August of this year, the Guangzhou Municipal People's Government issued the Action Plan for Promoting the Integration and Development of the Innovation Chain Industry Chain in Guangzhou (2022-2025), which proposed to adhere to the principle of industry first and manufacturing industry as the city, put the basic point of the development of the real economy on innovation, open up the path of "science and technology, technology production, product industrialization, and industry capitalization", and promote the construction of a strong city with scientific and technological innovation and advanced manufacturing industry to promote each other.

"Under the transformation of kinetic energy, the Nansha economy also ushers in new opportunities." Shen Minggao took Nansha as an example to analyze the power source of its manufacturing development. First, the added value of the secondary industry in Nansha District accounts for 41.1% of the GDP in the region, and has an absolute advantage in the field of automobile manufacturing. The proportion of automobile to the total output value of the manufacturing industry in the region accounts for 48.7%. In addition, Nansha also has a certain layout in the fields of electrical equipment, chemical products, and electronic equipment; Second, Nansha is gathering regional venture capital resources. From the perspective of the number of venture capital and the target management scale of the fund, 58.4% of the venture capital institutions and 75.5% of the venture capital funds in Guangzhou are concentrated in Nansha and Huangpu District (including High-tech Zone and Economic Development Zone).

"The concentration of venture capital and venture capital can not only attract high-tech enterprises to settle in, but also boost the energy level of regional growth. Between 2015 and 2020, the cumulative growth rate of high-tech enterprises in Nansha District of Guangzhou reached 878.9%. In 2020, the R&D intensity (i.e. the proportion of R&D expenditure to GDP) in Nansha District was 0.6 percentage points higher than that in Guangzhou as a whole." Shen Minggao said that "technology+capital" is significantly improving the growth momentum of Nansha. Maintaining the proportion of manufacturing industry in GDP and going through the painful period of transformation of growth momentum will force and promote the high-quality development of China's economy and enterprises. Now is the best time for China's world-class enterprises to rise.