Chongqing Municipality

Key points

• Chongqing is one of China’s four municipalities directly under the central government’s control, and the only one in inland China. It is one of China’s largest cities, with a population of 30.48 million people.

• Chongqing recorded the highest level of GDP of any province in 2016 (10.7%).

• The city’s strategic location and importance has attracted significant government support to transform it into an economic, trade, and financial centre as part of China’s Western Development Strategy.  It is also a major link in China’s new One Belt One Road and Yangtze River Economic Belt initiatives.

• Current links between Chongqing and New Zealand are largely focused on commodities trade.  There are also some education and research links, and potential in new sectors such as environmental engineering and public healthcare management.

New Zealand-Chongqing links

Recent high-level visits from New Zealand to Chongqing include a business mission led by Minister of Trade Hon Tim Groser in March 2012, and a visit by Deputy Prime Minister and Minister of Finance Hon Bill English in July 2015.  To New Zealand, Madame Zhang Xuan, Chair of the Chongqing People’s Congress visited Auckland and Tauranga in July 2015, Executive Vice Mayor Mr Weng Jieming visited Auckland in July 2016 and Vice Mayor Mr Liu Qiang visited New Zealand in April 2017.  Chongqing does not currently have any formal city partnerships with New Zealand cities. 

Chongqing’s main economic sectors (automotive, chemical and heavy industry) are not traditional areas of deep involvement for New Zealand.  But the market remains an important one for New Zealand food and beverage exporters, and New Zealand products are often seen in market. Due to Chongqing’s inclusion as one of China’s first cross-border e-commerce (CBEC) pilot areas (along with Chengdu as the only two in Western China), it was one of the top five destinations for New Zealand airfreight to China in 2016, comprised mainly of infant formula sourced through e-commerce channels. 

In December 2016  Tianjin Airlines commenced year round flights between Tianjin, Chongqing and Auckland – the first direct air service from Western China to New Zealand. The service operates three times a week and adds approximately 83,000 seats to Auckland-China air traffic each year. Auckland International Airport estimates the route could contribute an additional $102 million to the New Zealand tourism industry annually.  According to Statistics NZ data, over 4600 Chongqing residents made general visits (tourism or business) to New Zealand in 2016:  this number is expected to increase in 2017 due to the direct flight.

Zespri has established a regional office in Chongqing, as it is a key logistics hub for Southwest China.  ANZ Bank has a commercial branch in Chongqing.  Although few other New Zealand companies have a permanent presence in Chongqing, some are actively exploring opportunities in areas such as environmental engineering and urban planning. Relevant to the latter, Chongqing has been selected as a pilot city for China’s new ‘Sponge City’ urban water management programme.

Education links are also gaining momentum.  A small but growing number of New Zealand education institutions, such as the Southern Institute of Technology and University of Auckland, have formal links with Chongqing partner institutions.

There is a small New Zealand community resident in Chongqing. 

Background

Quick facts (2016)
Chongqing Municipality
Chongqing Municipality

Population: 30.48 million

Ethnicity: 94.2% Han Chinese, 5.8% other ethnicities

Land area: 82,403 km²

Total GDP: 1.76 trillion RMB (NZ$354.72 billion)

GDP growth: 10.7%

Per capita GDP: 57,902 RMB (NZ$11,697)

CPI growth: 1.8%

Chongqing has a long history and archeologists believe that early humans were in the Chongqing area twenty to thirty thousand years ago.  Later historical studied associates Chongqing with the State of Ba: The Ba people supposedly established Chongqing (then called Yuzhou) during the “Spring and Autumn Period” from about 771 BC. The city received its current name (meaning ‘double celebration’) during the Southern Song Dynasty to mark the enthronement of Chongqing native Emperor Zhaodun in 1189. 

From 1940-1946 Chongqing served as the wartime capital of China during the Sino-Japanese War, and some foreign governments established temporary diplomatic missions there. To help accelerate its development, in 1997 Chongqing was separated from Sichuan Province and established as a municipality directly under the central government, as one of four such cities in China (alongside Beijing, Tianjin and Shanghai).

Built on steep hills sloping down to the Yangtze River and one of its main tributaries the Jialing River, Chongqing is known as the Mountain City. It is also known as "Fog City" – a relevant factor during wartime aerial bombardments.  As a river transport hub Chongqing historically had a blue-collar or ‘dockside’ feel that still echoes today in its down-to-earth and resilient inhabitants, albeit under a modern facade.

Chongqing lies at the core of the economic belt of the upper Yangtze River, connecting China’s vast west and eastern coast. It is a key region for implementing China’s ‘Western Development Strategy’, launched in 2000 to bridge the gap between China’s more developed eastern coastal regions and relatively less developed internal western areas.  Cities like Chongqing (and nearby Chengdu) have received extensive government support to develop its transport, IT, manufacturing and financial sectors.  Chongqing has also piloted a number of important socio-economic reforms designed to increase internal labour mobility in China, not least as a result of population relocations during construction of the Three Gorges Dam and resulting reservoir on the Yangtze River downstream from the city.

Chongqing is an important inland transport hub and inland port, and has invested heavily in transport infrastructure to attract investment. Previously most commercial and passenger traffic was by river, but the city now promotes itself as an air, river, road and rail (ARRR) hub.  Many tourists pass through Chongqing at the start or end of Three Gorges boat cruises.  Chongqing’s Jiangbei Airport is one of China’s top ten busiest airports with 35.88 million passenger arrivals in 2016. A new 14-day rail freight service linking Chongqing with Germany, has been established alongside a number of similar services from other Chinese cities, under the umbrella of the One Belt One Road initiative.

Economy

As elsewhere in China, Chongqing’s GDP growth has cooled from its high-points of 16-17% in 2010-11. But it has nevertheless stood out as a growth engine in China in 2015-16: Chongqing was one of a few province-level areas in China to record double-digit GDP growth in the past two years, and recroded 10.7% growth in 2016. Chongqing’s GDP total is 1.76 trillion RMB, ranking 20 of the 31 provinces and municipalities in China due to its relatively low population – but per capita GDP in 2016 was a healthy 57,902 RMB (10th of 31), higher than China’s national average.

Chongqing’s key economic sectors include electronic information, automobile, equipment manufacturing, chemical engineering, materials, energy and consumer goods.  In the past, up to 75 per cent of Hewlett Packard’s global tablet computers were assembled in Chongqing. It is also one of China's largest centers for motor vehicle production and the largest for motorcycles – by 2015, the output reached 3 million with a value of 470 billion RMB.  Ford’s JV with Changan, with three plants in Chongqing is the company’s largest assembly operation outside Detroit.  Chongqing is also one of the nine largest iron and steel centers in China and one of the three major aluminum producers. South West Aluminum operate’s Asia's largest aluminum plant.

The city and its largely rural environs have deposits of coal, natural gas, and more than 60 kinds of minerals such as strontium and manganese. Chuandong Natural Gas Field is China's largest inland gas field with deposits of around 270 billion m3 - more than 1/5 of China's total. It also has China's largest reserve of strontium (China has the world's 2nd biggest strontium deposit). The Three Gorges Dam, the world's largest, is downstream from Chongqing and supplies much of its electricity:  the city is a major load centre on the national grid.

Two new Chinese Government strategies are set to further boost Chongqing’s economic credentials and drive further growth.  Chongqing promotes itself as a key domestic link in China’s “One Belt One Road” initiative, which has the aim of strengthening the country’s transport, trade, investment and other connectivity in the footsteps of ancient Silk Road and Maritime Silk Road routes.  It is also a nexus between OBOR and the Yangtze River Economic Belt initiative, which has the goal of strengthening trade, investment and people flows between the coastal, mid-stream and upper reaches of the Yangtze river.  Local analysts sometimes refer to the resulting combined local strategies as “Two Belts One River”. 

The Chongqing Pilot Free Trade Zone (PFTZ) was officially launched on 1st April 2017 as one of seven newly-approved free trade zones across China, bring the total number in China to 11. The PFTZ aims to expand advanced manufacturing sectors, as well as facilitate the development of “One Belt, One Road” and the “Yangtze River Economic Belt”. The PFTZ is spread across three areas of Chongqing. The Liangjiang area (covering Chongqing Lianglu-Cuntan Free Trade Port Area) will focus on expanding the high-end manufacturing sector. The Xiyong area (covering Xiyong Comprehensive Free Trade Zone and Railway Bonded Logisitics Centre) will focus on production-related service industries and bonded logistics. The Guoyan port area will focus on establishing a multi-logistics transshipment centre.