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Wuhan – China’s Logistics, Industry & High Tech City

Wuhan is an expanding business hub in Central China of growing importance to the national economy. With a population of more than 8.3 million people, its major strengths lie in its strategic location, its emphasis on heavy industry, and its strong tertiary education base, giving it a strong position as a modern, high-tech center.

In the first six months of 2011, Wuhan’s GDP grew 12.4 percent over the previous year to RMB 322 billion (US $50.7 billion). Disposable income per capita also increased 13.5 percent to RMB 12,651 (US $1,992). In 2010, foreign direct investment in Wuhan rose to US $3.3 billion (RMB 21 billion), an increase of 12.2 percent over 2009. Wuhan's logistics sector revenue stood at US$237.83 billion in 2010, accounting for 10 % of municipal GDP.

The heavy industrial sector—led by China's first major steel complex and fourth-largest steel producer, Wuhan Iron and Steel (Group) Corp.—has led the way in Wuhan’s economic growth. Taking advantage of this base, many foreign automakers have set up shop there, most prominently Dongfeng Peugeot-Citroën Automobile Co. Ltd., Dongfeng Honda Automobile Co., Ltd., and Dongfeng Nissan Passenger Vehicle Co.

Under the 12th Five-Year Plan (2011-2015), the Wuhan municipal government has prioritized the development of 15 strategic emerging industries: energy and environmental conservation, new-generation information technology, new energy, new material technology, clean energy automobiles, the animation industry, integrated circuits, financial services, high-end equipment manufacturing, software outsourcing, bioengineering, numerical control lathes, modern logistics, the laser industry, and the flat panel display industry.

Strategic location - logistics

At the convergence of the Yangzi River and its tributary, the Han Shui, Wuhan has historically been a natural hub for waterway transport and a key trading center. It is also in close proximity to China's major population centers: Beijing, Chongqing, Guangzhou, Shanghai, Shenzhen, and Tianjin. Numerous provincial capitals—Nanjing, Jiangsu, and Xi'an, Shaanxi—all lie within a 1,200 km radius of the city.

Strategically important to China's transportation network, Wuhan has benefited hugely from China's transport infrastructure boom and is slated to become an even more important rail, road, air, and water hub. Major rail lines and expressways that connect Beijing with cities in Guangdong, and Shanghai with Chengdu, pass through Wuhan.

Current facilities are capable of berthing sea-going ships of 10,000 tons. In addition, Wuhan's Tianhe Airport is the largest in central China, providing service for domestic and regional carriers.

Logistics Infrastructure

According to Xinhua News, Wuhan plans to invest US$18.2 billion in logistics infrastructure, including 173 construction projects over the next four years (to 2016). The municipal government will boost logistics sector development in industries of business trades, manufacturing, ports and bonded area, building around six complex logistics park and eight specialty logistics centres covering medicine, bonded area, dangerous chemicals, cold chain, automobiles, steel, home appliances and production materials, and build about 100 distribution depots at business congestion areas, key industry areas and large communities.

New Entrants to Wuhan

In July 2011, Global 500 Company Schneider Electric and Wuhan Donghu New Technology Development Zone Management Committee signed a contract announcing the establishment of the corporation’s first Chinese regional headquarters in Wuhan Optical Valley.

Chinese technology company Lenovo has also signed an agreement with the municipal government of Wuhan in May and announced the founding of its new industrial base in the city. Lenovo's new industrial base in Wuhan is reportedly a comprehensive base that integrates research, development, manufacturing, and sales of mobile Internet devices. Over the next five years, this base will gain over CNY5 billion in investment from Lenovo, and is expected to be completed and put into production in October 2013.

In June, Valspar Paint, the second largest paint brand in the USA and the sixth largest in the world has opened its flagship shop in Wuchang District, Wuhan. This is the fifth Valspar store in mainland China after Shanghai, Suzhou, Chengdu and Changsha.

(Sources: Automotive Business Review, China Business Review, Chinatech News, SCMP)

 

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