VZCZCXRO5980
RR RUEHCN RUEHGH RUEHVC
DE RUEHGZ #2402/01 3490805
ZNR UUUUU ZZH
R 150805Z DEC 06
FM AMCONSUL GUANGZHOU
TO RUEHC/SECSTATE WASHDC 5575
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUCPDOC/USDOC WASHDC
RUEHRC/USDA FAS WASHDC 0925
RUEATRS/DEPT OF TREASURY WASHDC
RUEAIIA/CIA WASHDC
RUEKJCS/DIA WASHDC
RHHMUNA/HQ USPACOM HONOLULU HI

UNCLAS SECTION 01 OF 02 GUANGZHOU 032402 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR EAP/CM 
USDOC FOR 4420/ITA/MAC/MCQUEEN 
STATE PASS USTR 
USPACOM FOR FPA 
TREASURY FOR OASIA/INA-CRANE 
USDA FOR FAS/ITP AND FAS/FAA 
 
E.O. 12958: N/A 
TAGS: ECON ETRD EINV EAGR ELAB CH
SUBJECT: Guangxi Zhuang Autonomous Region Q3 Economic 
Report 
 
¶1. (U) SUMMARY: Guangxi's gross domestic product (GDP) 
growth reached a record high 13.1% in the third quarter (Q3) 
of 2006.  The Statistics Bureau again characterized 
Guangxi's economic development as "fast and steady" despite 
government control measures.  The secondary and tertiary 
sectors experienced significant growth.  Fixed asset 
investments increased but not as quickly as the first two 
quarters.  Inflation remained low.  Foreign trade, 
particularly with ASEAN countries, was strong.  Residents' 
income continued double-digit growth.  Guangxi will likely 
achieve 12% GDP growth in 2006.  END SUMMARY. 
 
GUANGXI FAST FACTS 
------------------ 
 
GDP, billion USD                        38.3 (up 13.1%) 
Imports, billion USD                     2.2 (up 30.6%) 
Exports, billion USD                     2.5 (up 21.1%) 
Fixed-asset investment, billion USD     17.6 (up 28.6%) 
Consumer Price Index                     101 (up 1%) 
Disposable income per capita (urban),USD 935 (up 10%) 
Disposable income per capita (rural),USD 290 (up 12.3%) 
 
¶2. (U) Percentages in parenthesis represent growth compared 
to the same period in 2005 (according to the Guangxi 
Statistics Bureau).  All currency conversions in this 
report are made at the average exchange rate of USD 1 = RMB 
8.0071. 
 
¶3. (U) In the first three quarters, Guangxi's GDP amounted 
to RMB 306.61 billion (USD 38.3 billion), up 13.1% from the 
same period of last year, or 1.1 percentage points higher 
than the growth rate of the same period last year.  Guangxi 
has sustained GDP growth above 11% for the last 12 quarters. 
The value-added of the three sectors was: 
 
Primary sector     RMB 50.75 billion (USD 6.3 billion) 
Secondary sector   RMB 129.32 billion (USD 16.2 billion) 
Tertiary sector    RMB 126.55 billion (USD 15.8 billion) 
 
This represents an increase of 6.1%, 18% and 11.4% 
respectively; the sectors' share in GDP growth was 8.3%, 
53.9% and 37.8% respectively. 
 
INDUSTRIAL PRODUCTION 
--------------------- 
 
¶4. (U) Industrial production is the driving force of 
Guangxi's economy growth.  The value-added of industrial 
production was up 18.9%, or 2.8 percentage points higher 
than the growth rate during the same period last year.  The 
value-added of industrial enterprises with annual sales 
revenue of RMB 5 million (USD 624,000) or more (enterprises 
"above designated size," according to the Statistics Bureau) 
was up by 23.1%, or 2.1 percentage points higher year-on- 
year.  The profit made by these enterprises totaled RMB 
13.23 billion (USD 1.7 billion), up 37.5%.  Industrial 
production contributed to 49.1% of GDP. 
 
TOURISM 
------- 
 
¶5. (U) Guangxi attracted 1.227 million foreign tourists in 
the first nine months of 2006, bringing in RMB 2.17 billion 
in revenue (USD 270.6 million), up 18.8% year-on-year. 
 
FIXED ASSET INVESTMENT 
---------------------- 
 
¶6. (U) Fixed asset investment in the first three quarters 
of 2006 reached RMB 141.24 billion (USD 17.6 billion), up 
28.59% year-on-year.  The Statistics Bureau reported that 
these investments contributed over 70% to GDP growth. 
 
FOREIGN TRADE 
------------- 
 
¶7. (U) Guangxi's foreign trade volume amounted to USD 4.7 
 
GUANGZHOU 00032402  002 OF 002 
 
 
billion, up 25.4% year-on-year.  Of this total, exports 
accounted for USD 2.5 billion, up 21.1%; imports reached 
USD 2.2 billion, up 30.6%; the trade surplus reached USD 
280 million. 
 
-- ASEAN countries continue to be Guangxi's primary trading 
partners.  Exports to ASEAN countries reached USD 690 
million, up 21.8%. 
 
-- Private enterprises are a major force in Guangxi's 
foreign trade.  Among the top 50 enterprises with more than 
USD 10 million in exports, 17 are private enterprises. 
Exports from private enterprises amounted to USD 1 billion, 
up 36.1%. 
 
-- Major exports: mechanical and electrical products, 
textile and agricultural products. 
 
-- Major imports: industrial raw materials and agricultural 
products.  Imported fruit increased by 84.2%, coal imports 
increased by 4.5 times, imported ore increased by 27.6%, 
imported timber increased by 83.2%, and imported rubber 
increased by 97.1. 
 
RESIDENTS' INCOME 
----------------- 
 
¶8. (U) Residents' income rose steadily.  Urban residents' 
per capita disposable income reached RMB 7,486.9 (USD 935), 
up 10%.  Rural residents' per capita cash income reached 
2,323.8 (USD 290.2), up 12.3%. 
 
PROBLEMS IDENTIFIED 
------------------- 
 
¶9. (U) Guangxi's Statistics Bureau identified the following 
main problems affecting the Region's economic performance - 
less investment, widening price scissors for industrial 
products, a decline in the industrial products market, and 
decreasing commercial housing sales. 
 
PREDICTIONS FOR YEAR END 2006 
----------------------------- 
 
¶10. (U) The Guangxi Statistics Bureau predicted that GDP 
growth in the fourth quarter will reach RMB 168 billion 
(USD 21 billion), up 10.5%, resulting in year end GDP 
growth of 12%.  The Region will focus on construction 
projects, industrial production, and foreign investment in 
the fourth quarter. 
 
GOLDBERG