Search

Overview of Hangzhou Regional Market

Hangzhou is the political, economic, and cultural center of Zhejiang Provence and accounts for nearly a quarter of provincial economic output. Local investors attribute their choice of Hangzhou to various factors including lower office set up costs than Shanghai or Beijing, competitive government tax incentives, and a strong network of local IT companies.
Hangzhou realized a GDP of RMB 1,381.6 billion in 2018 with GDP per capita rising to RMB 82,988. The city has a good investment and business environment and is particularly attractive for the high-tech and advanced manufacturing industries.

Industry Specialization

Hangzhou’s industries have traditionally been textiles, silk, and machinery, but electronics, food processing, and other light industries have also been developing rapidly since 1992. Alibaba, China’s online behemoth, and Wahaha, the nation's largest beverage company, both have their headquarters in Hangzhou.

Although the city does not attract heavy industry, it is home to a growing light manufacturing sector, which focuses on textiles and small machinery.

Trends

The Hangzhou Bay area is the most important IT industry base in Zhejiang Province and is home to 70 percent of the province’s electronic enterprises, 80 percent of the IT product manufacturers, and 90 percent of the software development companies.

Almost all of the microelectronics and mobile-telecommunications industries are centered in this district. Major IT and electronics companies, such as IBM, Toshiba, and Siemens, have set up business in one of the three major development zones. The Hangzhou Bay area is becoming one of the most important IT bases in the world.

Government Support

Hangzhou has cultivated a first-class educational system capable of producing an abundance of human resources required by local industry.

The Xiasha Higher Education Park, located in the Hangzhou Economic and Technology Development Area, covers an area of 10.91 square kilometers and includes 15 higher education colleges.

Some of the key subjects of focus in the education system include electronic information engineering, computer science and technology, and manufacturing and automation.

Trading Relationship with Canada

Zhejiang province with Hangzhou at its center is an important export base for China-Canada trade, accounting for 15.4% of all Chinese exports to Canada in 2018. Although exports from Zhejiang to Canada continue to post strong growth, rising by annual 10.4% in 2018, the share of Canadian bound goods captured by the province contracted by 2% over the same period.

Canadian exports to Zhejiang province show a similar trend during 2018, rising in volume by 28% while at the same contracting in share from 8.1% of total Canadian exports to just 7.5%

Hangzhou and the greater Zhejiang area shows little sign of slowing down as import or export destination, however, it is likely that China’s movement up the value chain and strengthening middle class will diversify opportunities for Canadian exporters and importers.

Zhejiang Province’s Trading Relationship with Canada
Trade type / description20172018(%) Change
Imports from Canada (US$ billions)1.662.1228%
Share of China’s Total Imports from Canada8.1%7.5%-8.1%
Exports to Canada (US$ billions)4.925.4310.4%
Share of China’s Total Exports to Canada15.7%15.4%-2%

Imports from Canada

Canada’s major trading relationship with Hangzhou and greater Zhejiang province is dominated by the supply of raw materials and components used in manufacturing. Wood pulp, organic chemicals, plastics, and metals all showed sales volumes in excess of US$ 100 million in 2018 and growth over the previous year.

Wood pulp, Canada’s largest export to the region, is utilized in the textiles industry as part of the process used to create rayon fabric. Other products, such as plastics and metals play important supporting roles in the electronics and light machinery industries.

Zhejiang Province’s Top Imports from Canada (2017/2018)
HS CodeProduct DescriptionValue (US$ millions)(%) Change
20172018
47Pulp of wood, waste & scrap of paper594.88704.8418%
29Organic chemicals156.1222.1842%
39Plastics & articles thereof50.21179.15257%
75Nickel & articles thereof81.65172.02111%
74Copper & articles thereof123.01152.6824%
44Wood & articles of wood, wood charcoal197.42119.45-39%
26Ores slag & ash94.17119.4527%
23Residues from food industries, animal feed12.1960.74398%
27Mineral fuels, oils, waxes & bituminous57.9838.97-33%
15Animal or vegetable fats, oils & waxes11.6838.06226%

Exports to Canada

Hangzhou is primarily focused on the sale of consumer goods to the Canadian market. Furniture, electronics, and textiles are the largest sectors of export, with exports value reaching US$702, US$671, and US$359 million respectively in 2018.

Chinese electronics manufactures have shown particular success in the Canadian market during 2018, posting export growth of 32% compared to 2017. Across the province’s top 10 export categories, none have contracted. Textiles exports to Canada have remained steady with less than 1% growth during the last year. 

Zhejiang Province’s Top Exports to Canada (2017/2018)

HS Code
Product DescriptionValue (US$ millions)(%) Change
20172018
94Furniture, bedding, cushions, lamps & lighting fittings642.07702.849%
84Boilers, machinery & mechanical appliances, computers509.8671.0532%
87Vehicles other than railway or tramway rolling stock327.3369.613%
61Articles of apparel & clothing accessories-knitted or crocheted359.25359.810%
39Plastics & articles thereof296.98348.7517%
63Made-up textile articles220.95237.077%
76Aluminum & articles thereof172.61201.917%
64Footwear, gaiters, & the like132.29142.928%
42Articles of leather, saddlery & harness, travel goods, handbags105.01117.9112%
44Wood & articles of wood, wood charcoal75.1686.7615%
Date Modified: