Shenzhen GDP Growth Rate Lowest Since 1979

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Jan. 17 – The Shenzhen government has issued a 9 percent GDP growth rate target for 2013, down from the 10 percent achieved last year and against a background of the city mayor, Xu Qin, stating that “double digit growth rates are in the past.” The 2012 growth was the lowest since the city became a special economic zone in 1979. Between 1980 and 2006, Shenzhen achieved annual growth rates averaging 27 percent.

Export growth slowed by 9 percent last year, and the profits of local industrial companies fell by 5.5 percent during the same period, Xu stated at the Shenzhen People’s Congress yesterday. Fixed asset investment grew by 12.3 percent, an increase from the previous year’s 10 percent.

Xu stated that the slowdown was due to declining global demand and the attempts by the city government to upgrade its economic model away from low-end manufacturing. He said that more than 1,500 labor intensive businesses had closed down over the past four years, yet had still to be fully replaced by service and technology driven industries. Shenzhen has been losing investment to nearby Vietnam in particular with many foreign-invested and domestic companies relocating industrial units there.

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