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Wenzhou’s Industrial Economy, a Leader in the Country
【Fonts: Large Medium Small 【Source: Wenzhou·China 【Date: 2019.11.03】

Wenzhou's industrial economy still grows stable despite the complicated and varied economic environment. From January to September this year, Wenzhou's industrial added value (IAV) reached RMB 134.38 billion, a rise of 7.8% yoy, in which the added value of the industrial enterprises above the designated size (IEDS) was up to RMB 79.28 billion, jumping by 7.6% yoy and 1.8 percent higher than this province's average in the same period. According to an analysis, there exist quite a few positive factors in favour of Wenzhou’s steady growth of industrial production, and firm underpinning for its industrial economic development.

Since the beginning of this year, around the theme of “working hard mainly in six aspects in 2019 to achieve one general goal and meet one general requirement by competition”, Wenzhou’s government organs focused their work on the construction of “the Pilot District for Private Enterprises’ Sound Growth and Their Staff’s Sound Ideology Fostering(also named as the National Independent Innovation Demonstration District). They have fostered drivers of growth, improved the allocation of available resources, and effectively defused economy downward pressure by making full use of favourable policies. Owing to their efforts, the local economy keeps on generally-stable operation with a tendency of stead progress, and main economic indicators are better than those of this province and of other parts of the country; its industry transformation and upgrading are steadily advancing, and the quality of economic operation continues to improve.

Viewing from the perspective of economy: High-quality enterprises are a “main force” in driving the industrial economy development

According to reports, in the second half of the year, the slowdown in the growth rate of IAV of Wenzhou’s IEDS has tended to be improved, the stability of the growth rate has somewhat increased, and the industry continues to maintain growth in a large scope.

According to an analysis, 31 in the 33 major industries achieved positive growth in the industrial added value, with such industries increasing by one over the same period of last year. Among the 31 industries, the growth rate of 15 industries, such as special and general equipment manufacturing as well as metal products manufacturing, exceeded 10 %, with the industries possessing such a growth rate increasing by two over the same period of last year. The pillar industries still play a role of underpinning the positive growth. Among the industries, those of electrical appliances, clothing, pumps and valves have increased by 8.5%, 7.7% and 16.8% respectively in the IAV. The growth rate of the three industries is 0.9%, 0.1% and 9.2% higher than that of the IEDS respectively. 

Promising, efficient, and leading companies are becoming a “main force” contributing to the city’s economic growth, which is another highlight of the city’s industrial economy this year. In the first three quarters, the IAV of 103 leading industrial enterprises in Wenzhou increased by 8.5% yoy, and that of 108 fast-growing IEDS increased by 13.4 % yoy. The two types of enterprises’ IAV growth rate brought about 2.09- and 0.54- percent rise in the same rate of the city’s IEDS respectively. In addition, 1027 small- and micro- enterprises newly upgraded to IEDS promoted a 2.8-percent increase of the rate of the IEDS. The above achievements are owing to the municipal government’s tireless efforts. In recent years, the government has been persistently taking effective measures to improve the allocation of available resources and increase quality supply, and to help, foster, and stimulate the city’s enterprises to acquire quality development, and tap their developing potential. Thus are emerging more and more quality enterprises with strong innovative and anti-risk capabilities, and a high output. 

It is also worth mentioning that in the first three quarters, Wenzhou was generally superior to the other parts of the whole country in industrial production. From January to September, the IAV growth rate of the city's improve the allocation of available resources was 1.8 percent higher than that of the IEDS in the other parts of the province, and 2 percent in the rest parts of the country.

An analysis of IAV growth rate: Intellectualized reconstruction drives enterprises’ transformation and upgrading; performance evaluation based on output boosts their efficiency

What supports the city’s stable industrial production under the pressure of the complicated economic environment? That’s a series of quality development policies to stabilize enterprises by fostering their growth drivers, and promoting their transformation

The technical transformation featuring intellectualized reconstruction is becoming the driving force for the transformation and development of enterprises. From January to September this year, the city's investment growth rate of technical transformation was 24.3% higher than the provincial average of 21.2 percent, ranking second and among the top 2 in the province this year. At present, the city has carried out investigation in its 227 enterprises’ intellectualized reconstruction, and increased 1612 new industrial robots this year, which means that the city has completed 95% of its related annual task. According to reports, the rapid growth of the technical transformation is closely related to intensifying its support policies in various regions of the city. For example, Yueqing, Ruian and other counties helped enterprises’ technical transformation by linking the fiscal deposits in local banking and financial institutions to how they support the technical transformation of enterprises.

The company's innovative enthusiasm is also evident in R&D investment. From January to August, the industrial R&D expenses of the city’s IEDS increased by 27.6%, accounting for 2.57% of their operating income, which ranked second in the province.  In the first three quarters, the output value of industrial new products in the city increased by 38.7%, ranking second in the province; 12 enterprises in the city were inscribed on the list of Provincial-level Enterprise Technology Centers for publicity, and 12 enterprises were recognized as provincial-level industrial design centers, ranking first in the number of recognized enterprises in the province. In addition, 47 enterprises were identified as municipal industrial design centers.

With the sustained and in-depth advancement of the reform of performance evaluation based on output, the quality and efficiency of the city’s enterprises have been significantly improved. The reform has now become a strong support for the steady growth of the industrial economy. Since the beginning of this year, Wenzhou has rectified 1637 inefficient enterprises with an annual output of RMB 30,000 per mu (about 660m2), and industry platform of RMB 50,000 per mu. The city's averaged tax payment per mu has ranked third in the province, and the averaged added value per mu taken the second place in the province. Its enterprises’ averaged revenue per mu takes the lead in the province, and the industrial profits of the city's IEDS increased by 3.8%, which was 1 percent higher than the provincial average.

At the same time, the city’s per capita revenue is also increasing rapidly. The city’s labor productivity growth rate of the IEDS’ all employees is 12.6%, which is 3.8 percent higher than the provincial average, and the growth rate ranks second in the province.

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