Sichuan Economy and Trade Trends

Monthly, February 2014

Published by CCPIT Sichuan Council

Contents

Macro Economy

Sichuan Provincial Industrial Structure Further Optimized

In 2013, total output value of six strategic emerging industries in Sichuan realized RMB541.865 billion, up 20.5% year on year. With year-on-year growth of 20.9%, sales value reached RMB529.688 billion, around 10.9 percentage point higher than increase rate of all industrial sales value. Meanwhile, proportion of sales value in industry above designated scale increased to 15.12%, 2.2 percentage points higher than last year, showing that industrial structure in Sichuan was further optimized.

Among six strategic emerging industries, new generation of information technology industry took the largest volume, had rapidest increase rate and brought great significance on promoting the development of emerging industry. In 2013, new generation of information technology industry realized total output value of RMB219.55 billion with year-on-year growth of 36.8%, accounting for 40.5% in total value produced by emerging industry. With total output value of RMB109.266 billion and year-on-year growth of 9%, new material industry became another strategic emerging industry whose output value exceeded RMB100 billion. With recovery and turnaround tendency, new energy industry’s total output value increased by 2.5% on year-on-year basis. Besides, high-end equipment industry in Sichuan increased slightly as always, for example, output value of Chengdu Engine (Group) Co., Ltd. and Sichuan Honghua Petroleum Equipment Co., Ltd. realized rapid increase rate of over 20%. Moreover, bioengineering and pharmaceutical industry and energy conservation and environmental protection industry maintained good development momentum and realized total output value of 16.6% and 25.8% respectively on year-on-year basis. (Sichuan Daily reported on February 20)

RMB1 Billion Invested in Chengdu per One Working Day

Market entities in Chengdu are developing rapidly and urban industry is undergoing transformation and upgrading. In 2013, registered capital (fund) amount of different kinds of market entities topped RMB1.6 trillion, breaking RMB1.5 trillion for the first time. With year-on-year growth of 23.34%, the number of newly registered market entities reached more than 150,000 and nearly RMB1 billion was invested in Chengdu per working day, setting a new record on increase rate in recent 5 years.

Even though there were great number of market entities in Chengdu in 2013, total number of different kinds of market entities in Chengdu still increased by 20.22% with total amount of registered capital (fund) topped RMB1.642444 trillion, breaking RMB1.5 trillion for the first time, accounting for 54% of total registered capital (fund) amount of Sichuan provincial market entities and ranking the third among all sub-provincial cities in China. (Sichuan Daily reported on February 23)

Foreign Trade

Import & Export of Sichuan in January Hit New One-month High

In January, total import and export value of Sichuan realized USD7.53 billion which broke USD7 billion for the first time. Among total import and export value, USD5.5 billion was produced by export and it broke USD5 billion for the first time. Total export value, as well as total import and export value, hit new one-month high in history.

Expressed in Renminbi (RMB), in January, Sichuan realized total import and export value of RMB46.06 billion, up 30.2% year on year and 7.3% higher than increase rate of national overall import and export. Besides, growing rate of Sichuan export and import is respectively 33.6 and 0.5 percentage points higher than national average level during the same period. (Sichuan Daily reported on February 15)

Cross-border RMB Settlement Amount Cracked RMB100 Billion for First Time

Nowadays, for import and export trade and foreign investment and financing activities in Sichuan, more and more enterprises begin to conduct settlement with RMB directly. Since Sichuan was regarded as a pilot area for settling transactions with RMB in 2010, cumulative settlement amount till today has topped RMB117.1 billion already and Sichuan cross-border RMB settlement amount in 2013 reached RMB71.1 billion. The proportion of cross-border RMB settlement taking up in all cross-border capital payment reached 12.3% and RMB has become the second largest currency used in Sichuan for foreign economic exchanges after U.S. dollar.

Sichuan has had cross-border RMB settlement with 93 countries and regions and had full coverage on all 21 cities (prefectures) of Sichuan. Among total cross-border RMB settlement amount, settlement with Hong Kong accounted for nearly 60% and Singapore and Southeast Asia were main areas for cross-border RMB settlement of Sichuan. (Sichuan Daily reported on February 5)

Chengdu-San Francisco Direct Flight to be Opened in June

In June 2014, direct flight from Chengdu to San Francisco in America will be opened and the frequency of many other international routes such as Chengdu-Frankfurt and Chengdu-London are expected to be intensified in 2014.

Chengdu Shuangliu International Airport will continue to promote the development of international routes in 2014. The direct route from Chengdu to San Francisco in America to be opened on June 11 is the first air route that flies from central and western China to America and Chengdu becomes the fourth city in hinterland that opens direct flight to America. Besides, other international remote air lines such as lines from Chengdu to Africa and Chengdu to Russia are also being planned. (Sichuan Daily reported on February 8)

Exports to ASEAN of Panzhihua Accounted for 23.5% of Total Exports

In 2013, Panzhihua realized total export value of USD123.06 million, among which USD28.90 million were from ASEAN, up 8% year on year and accounting for 23.5% of total export value of entire Panzhihua. Thus, ASEAN became the largest export market of Panzhihua.

As the portal in south Sichuan, in recent years, Panzhihua has encouraged and supported foreign trade and economic enterprises to expand emerging markets such as ASEAN market proactively and tried to create conditions for enterprises to march into ASEAN market by organizing more than 30 enterprises such as Panzhihua Steel Group Co., Ltd., Panzhihua Baiyun Foundry Co., Ltd., Tiancheng Silk Co., Ltd. and Panzhihua Ruihua Agriculture Development Co. Ltd. to participate in exhibitions including Kunming Import & Export Commodities Fair and China-ASEAN Exposition. Besides, Panzhihua also provided financial support to titanium dioxide enterprises to participate in INACOATING, Vietnam Coating Exhibition (VNCE) and APCS held in Thailand, trying to strengthen brand cultivation of export enterprises.

In 2013, superior products of Panzhihua including steel rail, titanium dioxide, raw silk and vanadium-titanium castings were exported to ASEAN market and had strong growth tendency. State-owned enterprise Panzhihua Steel maintained steel rail export advantage to ASEAN with export value of USD16.41 million, taking up 66% of total value of Panzhihua steel rail export. (Sichuan Daily reported on February 13)

Key Projects

Neijiang-Zigong-Yibin Interurban Railway to be Constructed in 2014

The construction of Neijiang-Zigong-Yibin Interurban Railway is expected to be started prior to 2015 as the fastest and to be completed in 2018. Neijiang-Zigong-Yibin Interurban Railway starts from Beimu of Neijiang, where Neijiang-Zigong-Yibin Interurban Railway connects with Chengdu-Chongqing High-speed Railway, passes Zigong and Fushun, and finally ends at Lingang of Yibin, where Neijiang-Zigong-Yibin Interurban Railway connects with Chengdu-Guiyang High-speed Railway. With the completion of Neijiang-Zigong-Yibin Interurban Railway, only half an hour will be needed from Yibin to Neijiang. (Sichuan Daily reported on February 13)

Industries

Some Listed Sichuan Wine Companies Declined In Performance in 2013

According to 2013 Announcement on Predicted Performance Loss of Listed White Wine Companies firstly issued by Swellfun on the night of January 20, Swellfun predicted that net profit attributable to shareholders of listed companies throughout 2013 might be RMB124 million-RMB160 million. According to 2013 Preliminary Earnings Estimate issued by Luzhou Old Cellar on the night of January 27, Luzhou Old Cellar might realize revenue of RMB10.504 billion in 2013 with year-on-year decline of 9.1%, might realize total profit of RMB4.674 billion with year-on-year decline of 24.02%, and might realize net profit of RMB3.444 billion with year-on-year decline of 21.55%. According to 2013 Announcement on Predicted Performance Loss issued by Tuopai Shede on the night of January 28, Tuopai Shede predicted that it might realize net profit with year-on-year decline of 80%-100% in 2013. (Sichuan Daily reported on February 12)

44 New Provincial Innovative Pilot Enterprises Established in Chengdu

In 2013, Chengdu had 44 new Sichuan provincial innovative pilot enterprises and 132 innovative cultivation enterprises, accounting 46% of total number of newly established innovative enterprises in Sichuan. Up to today, 594 provincial innovative enterprises have been settled in Chengdu.

Since last year, Chengdu has further strengthened the guidance and support to the construction of innovative enterprises and proactively organized enterprises in Chengdu to conduct pilot work. Rapid growth of these enterprises will lead more enterprises in Chengdu to take the road of innovative development, to form innovation culture of enterprises and to promote the cluster development of innovative enterprises that contributes to industrial development. (Sichuan Daily reported on February 18)

Annual Output Value of Grain and Oil & Staple Food Industry Broke RMB100 Billion for First Time

In 2013, production and marketing of Sichuan agricultural products processing industry maintained good momentum. With year-on-year growth of 18.03%, Sichuan agricultural products processing industry above designated scale realized total industrial output value of RMB779.047 billion, among which annual output value of grain and oil & staple food industrialized products industry broke RMB100 billion for the first time.

With regard to output value and sales revenue, output value and sales revenue of Sichuan agricultural products processing industry accounted for 25% and 25.1% respectively of that of Sichuan provincial industry above designated scale, so that agricultural products processing industry has become the “stable support” plate for contributing to RMB1 trillion added value of industry above designated scale. With regard to growth rate, growth rate of output value, revenue and profit of agricultural products processing industry was respectively 1.33, 1.36 and 15.18 percentage points higher than that of Sichuan provincial industry with obvious industrial advantages.

With accumulative total output value of RMB113.882 billion in 2012, grain and oil & staple food industrialized products industry became another industry after white wine industry whose output value broke RMB100 billion. Among the output value, RMB15.19 billion was produced by staple food industrialized products, up 22.87% year on year.

In aspect of industry, food processing industry continued to maintain rapid growth with output value taking up 66% of that of agricultural products processing industry. With year-on-year growth of 19.88%, 1941 enterprises in food industry above designated scale realized total industrial output value of RMB513.875 billion and main business income and profit realized growth of 17.67% and 39.47% in respective on year-on-year basis. (Sichuan Daily reported on February 5)

Petrochemical Industry Realized Year-on-year Revenue Growth of Nearly 10% in 2013

In 2013, petrochemical industry of Sichuan realized accumulative total main business income of RMB383.679 billion with year-on-year growth of 9.95%, profit and tax of RMB31.366 billion and profit of RMB16.135 billion, showing stable and steady development. From the output of main products, among the 16 kinds of main products crucially dispatched, 9 kinds of products realized year-on-year growth while another 7 kinds of products had decline at some degree. (Sichuan Daily reported on February 18)

Longquanyi District Manufactured 723,000 Entire Vehicles in 2013

With sustained doubling number of entirely manufactured vehicles in 2013, Longquanyi District achieved annual output of 723,000 vehicles that accounted for more than 90% in Chengdu and 89.6% in Sichuan. Under the powerful support of leading automobile industry, Longquanyi District realized gross regional domestic product of RMB83.71 billion, up 19% year on year and contributing to 25% of gross regional domestic product of Chengdu. Industry above designated scale in Longquanyi District completed added value of RMB64.1 billion and contributed to 56.4% of that in Chengdu. Besides, financial indicators of Longquanyi District realized new breakthroughs and industry revenue supported by automobiles reached RMB9.31 billion.

In 2014, annual output of entire vehicles in Longquanyi District is expected to break 800,000 and sales revenue of entire vehicle industry is expected to top RMB100 billion. (Sichuan Daily reported on February 19)

Total Output Value of High and New Technology Industry in Sichuan Topped RMB1 Trillion

In 2013, total output value of high and new technology industry in Sichuan increased by two RMB100 billion on year-on-year basis and realized RMB1034.17 billion, breaking RMB1 trillion and ranking the first in western China as always.

The scale of high and new technology industry in Sichuan continued to expand and enterprises in high and new technology industry above designated scale achieved total industrial value of RMB 923.8 billion with year-on-year growth of 15%, accounting for 25.8% of total industrial value of all industries above designated scale in Sichuan and 2.9 percentage points higher than that in last year. Total per household capital of high and new technology enterprises was RMB600 million, which was 3.4 times of that in 2006; high and new technology industry realized export delivery value of RMB237.34 billion, which was 17 times of that in 2006 and took up 88.3% of that of industry above designated scale.

High and new technology industry above designed scale in Sichuan mainly covers sex fields: electronic information industry, advanced manufacturing industry, aerospace industry, new material industry, bio-medicine and bio-agriculture industry, nuclear technology and new energy industry. Moreover, 55 high and new technology enterprises in non-industrial field realized main business income of RMB110.37 billion throughout 2013 and most of these enterprises are located in Chengdu. (Sichuan Daily reported on February 21)

Sichuan Geomatics Industry Achieved Average Annual Growth of More Than 25%

At present, in aspect of geomatics, Sichuan ranks the fifth in China and has more than 820 units in geomatics industry, among which 36 units are Class-A qualification units. With 36,000 practitioners in geomatics, Sichuan achieved total service value of RMB6 billion in 2013, achieving annual average growth of over 25% in recent three years.

In recent years, geomatics industry of Sichuan is showing an accelerated development trend because relevant data resource is continuously enriched, social application and livelihood assurance function of achievement become more prominent, geographic information products and services become polybasic, internet map market is flourishing as never before, hi-tech innovation capacity is significantly improved, industry transformation and upgrading is accelerated, construction of industrial park is fundamentally promoted and industrial clusters begin to emerge, etc. (Sichuan Daily reported on February 21)

High-alumina Cover Glass Put into Production in Mianyang

On February 21, the High-alumina Cover Glass Project of Sichuan Xuhong Opto-electronics Technical Co., Ltd., Tunghsu Group was launched into production in Mianyang. After the project realizes design production, it will produce high-alumina cover glass of 6.5 million m² annually and strongly promote the development of panel display industry and high-end display glass industry in China. (Sichuan Daily reported on February 22)

Profit of Agricultural Machinery Enterprises Increased by 30% in 2013

Agricultural machinery industry of Sichuan maintains good momentum. In 2013, operation condition of Sichuan agricultural machinery enterprises went better than that in 2012. According to the survey on sales condition of 90 agricultural machinery enterprises in Sichuan conducted by Sichuan Provincial Agricultural Department, sales revenue of agricultural machinery in 2013 reached RMB3.3 billion and profit realized RMB350 million, up 10% and 30% year on year respectively. (Sichuan Daily reported on February 23)

Business Scale of Financial Institution-to-be in Sichuan Ranked Third in China

In 2013, some financing guarantee companies and small loan companies in Sichuan developed rapidly in accordance with relevant regulations. Business scale of these financial institutions-to-be took the third place in China and effectively supported the social and economic development of entire Sichuan.

Data showed that up to the end of 2013, balance of financing guarantee of 444 (including 8 branches in Sichuan affiliated to institutions of other provinces) financing guarantee companies in Sichuan was RMB233.84 billion, up 18.81% year on year. Balance of financing guarantee in Sichuan accounted for 10% of total balance of financing guarantee in China, ranking the second place throughout China. The number of opened financing guarantee companies increased by 14 compared with that in the early of 2013 and number of practitioners increased to 11175. Loan balance of 344 small loan companies in Sichuan was RMB58.652 billion, up 55.9% year on year. The loan balance accounted for nearly 7% of that in China, ranking the third place throughout China. The number of opened small loan companies increased by 105 compared with that in the early of 2013 and number of practitioners increased to 8359. (Sichuan Daily reported on February 25)

On-stream Projects

Construction of Jianyang-Pujiang Expressway Started

On December 26, 2013, construction of Jianyang-Pujiang Expressway Project was started. With total length of127.4kmand79.9kmin Meishan territory and along the outer south edge of Chengdu Tianfu District, Jianyang-Pujiang Expressway starts from Hefeng Town of Jianyang, passes through Renshou, Pengshan, Dongpo, Pujiang and ends at Tianhua Town of Pujiang County. The project is estimated to have total investment of RMB15.775 billion, 6 lanes in two directions, design speed of100km/h, and 97 bridges, 5 tunnels, 6 interchange hubs and 11 general interchanges along the line. It is predicted that the project will be put into operation in the end of 2016. Up to then, driving time required from Jianyang to Pujiang will be shortened from 3h to 1.5h and time from Meishan to Jianyang and Pujiang will both be shortened by more than half an hour. (Sichuan Daily reported on January 3)

Projects Worthy of RMB30.9 Billion in Yibin Centrally Started in One Quarter and Construction of Yibin-Yiliang Expressway Launched

On February 20, 139 projects with total investment of RMB30.9 billion, including Yibin-Yiliang Expressway, were centrally started.

Sichuan section of Yibin-Yiliang Expressway is one of the eight north-south vertical lines that were added to Sichuan expressway network by adjustment scheme. With total length of130km, the Project has total investment of RMB16.5 billion. After completion, Yibin-Yiliang Expressway will be another new expressway leading out from Sichuan, just like Yibin-Xuyong Expressway and Yibin Transit Expressway.

With great investment, these projects cover extensive fields. Among these 139 project, 61 of them are infrastructural projects with total investment of RMB18.9 billion involved with transportation, water conservancy, energy, and cities and towns construction; 46 of them are industrial development projects with total investment of RMB6.2 billion; 25 of them are livelihood and social welfare projects with total investment of RMB2.4 billion; 7 of them are real estate projects with total investment of RMB3.4 billion. (Sichuan Daily reported on February 21)

Convention & Exhibition Economy

90th China Food & Drinks Fair to be Opened in Chengdu on March 28

The 90th China Food & Drinks Fair is to be held in Chengdu throughout March 28 to 31. As the first large exhibition held in Chengdu in 2014, the 90th China Food & Drinks Fair creates high in the quantity of international exhibitors and exhibition area. As well, it is the 25th time that China Food & Drinks Fair is held in Chengdu.

With total exhibition area of130,000m², the 90th China Food & Drinks Fair will be held at Chengdu Century City New International Convention & Exhibition Center. On the Fair, there will be nearly 3,000 enterprises, 150,000 traveling merchants and representatives from 14 countries in the name of government or industry association. Tens of thousands of exhibits from more than 30 countries and regions will be displayed and traded on the Fair. The area for international exhibits is38,000m²and area especially for imported food is2500m², increasing by 26% and 50% respectively compared with that of the 88th China Food & Drinks Fair.

Moreover, some other activities such as Topic Forum, Sino-France Wine Culture Exchange, Micro Film Release and Investment Symposium on China Wine and Food Industry will also be held during the 90th China Food & Drinks Fair. (Sichuan Daily reported on February 27)

China International Wine Expo Upgraded to International Exhibition

2014 China International Wine Expo will be held in Luzhou Liquor Industry Development Zone throughout March 23 to 27.

Aside from well-known domestic white wine and grape wine enterprises, industry associations from America, France and Australia and etc. and 40 famous foreign wine enterprises such as Diageo and Pernod Ricard will also attend the Expo. It is expected that more than 420 exhibitors will participate in the Expo.

Luzhou has held Wine Expo for consecutively 6 years since 2008 and since 2011, the Wine Expo has become the sole professional exhibition on wine in Sichuan held by provincial government and supported by national Ministry of Commerce. In 2013, the Wine Expo was upgraded to 14th Western China International Fair Chinese Liquor Fair-Expo. In 2014, the Wine Expo will be upgraded to an international expo. (Sichuan Daily reported on February 27)