Top 20 Foreign Trade Cities: Nanjing Drops Out of the Rankings, Wuhan Takes Its Spot, and Suzhou Outperforms Beijing by Nearly 300 Billion Yuan

In three months, the competition for top 20 foreign trade cities has shifted from "who rises and who falls" to "widening the gap".

The General Administration of Customs recently released the import and export data for the first three quarters, and the ranking of the top 20 foreign trade cities has been updated accordingly. Different from the major reshuffle in the first two quarters, in the third quarter, only Nanjing was squeezed out of the top 20, replaced by Wuhan.

The top four pattern remains unchanged. The total import and export volume of Shenzhen, Shanghai, Suzhou and Beijing in the first three quarters reached 4.65 trillion yuan, 3.94 trillion yuan, 3.07 trillion yuan and 2.78 trillion yuan respectively. The total of the four cities exceeded 14 trillion yuan, accounting for about 36.2% of the country's total import and export value.

The ranking stays the same, but what changes is the "gap". Suzhou's leading advantage over Beijing expanded from 41.5 billion yuan in the first half of the year to 291.6 billion yuan in the first three quarters, approaching 300 billion yuan.

Moreover, Xi'an, the dark horse that broke into the list in the first half of the year, further saw its growth rate jump to 115.5% in the first three quarters.

What has contributed to these changes?

Zeng Gang, Dean of the Institute of Urban Development of East China Normal University, gave the keyword AI in an interview with a reporter from Time Weekly. He believes that the high growth of imports in the first three quarters is essentially a capital expenditure and stocking cycle driven by AI computing power infrastructure. In the new top 20 list, cities that have seized the AI industrial chain such as Suzhou and Xi'an are accelerating to take the lead.

Outperforming Beijing, Suzhou's "Stockpiling" Logic

The competition for the third place seems to have been settled. In the third quarter alone, Suzhou's leading advantage over Beijing widened by about 250.1 billion yuan. What does Suzhou rely on to secure the third place?

According to data from Suzhou Customs, in the first three quarters of this year, the total foreign trade import and export volume of Suzhou reached 3.07 trillion yuan, a year-on-year increase of 51.9%, which is 33.1 percentage points and 22 percentage points higher than the national and provincial foreign trade growth rates respectively.

Reporters from Time Weekly sorted out and found that Suzhou shares a common feature with many other cities with rapid growth in this round, that is, imports grow faster than exports.

Suzhou's imports increased by 68.2% and exports by 42.1%, with imports growing 26.1 percentage points faster than exports; Shenzhen is more typical, with imports rising 70.1% while exports only increasing 18.5%, the scissors difference exceeding 50 percentage points; the same is true for Zhengzhou and Wuhan.

Zeng Gang told the reporter of Time Weekly that the phenomenon of "imports growing faster than exports" in this round of strong foreign trade cities is not an accidental short-term fluctuation, but a concentrated reflection that China's advanced manufacturing industry is in a superimposed stage of "capital expenditure expansion period" and "processing trade deepening period" with AI computing power as the core.

He pointed out that the AI-driven capital expenditure and stocking cycle is the core driving force.

Shenzhen ranks first in the country in the import and export scale of AI-related components such as integrated circuits, contributing more than 60% of the city's foreign trade increment. The high growth of imports is largely to meet the demand for intermediate goods stocking for the production of computing power hardware such as AI hardware (such as servers).

The import of mechanical and electrical products in Suzhou increased by as high as 92.5%, among which the export of computer, communication and electronic equipment manufacturing industry with high relevance to AI increased by 88%. The imported advanced equipment and parts directly serve the capacity expansion and export production of AI-related products.

In the first three quarters of this year, Suzhou's foreign trade crossed the 3 trillion yuan mark for the first time, exceeding the scale of the whole of last year.

Export Delivery, Xi'an and Hefei Enter the "Harvest Period"

The national total import and export volume in the first three quarters increased by 18.8% year on year. However, within the top 20, only 8 cities actually outperformed the overall market.

The growth rates of Shenzhen, Suzhou, Wuxi, Xi'an, Chongqing, Zhengzhou, Hefei and Wuhan are all above 18.8%, among which Xi'an's growth rate is as high as 115.5%.

As a well-deserved dark horse, Xi'an's growth path is exactly the opposite of Suzhou's, but both are related to the dividends of the AI industry.

Reporters from Time Weekly sorted out and found that Xi'an's exports soared by 142.1% and imports increased by 54.7%, while Hefei's exports increased by 62.0% and imports only increased by 10.1%. The export growth rates of the two cities are significantly higher than that of imports.

Zeng Gang pointed out that cities such as Shenzhen, Suzhou, Zhengzhou and Wuhan are in the period of capital expenditure expansion, and a large number of imports are the "fuel" and "seeds" for future growth. Imports growing faster than exports is a normal feature at this stage. Xi'an and Hefei, on the other hand, have taken the lead in entering the production capacity harvest period of some tracks, and the export explosion is the realization of previous investments. The two together constitute the complete picture of China's current foreign trade under the wave of industrial structure upgrading.

The explosion of Xi'an's exports is almost entirely driven by the release of local semiconductor production capacity, marking that Xi'an's memory chip production capacity has entered a concentrated realization period.

According to the statistics of Guanzhong Customs, in the first half of this year, the total import and export value of Micron Semiconductor (Xi'an) Co., Ltd. reached 230.79 billion yuan, a year-on-year increase of 224.1%, accounting for more than 50% of Xi'an's total import and export value, ranking as the leading foreign trade enterprise in Xi'an.

It is worth noting that Zeng Gang also pointed out that the volume and growth rate of Xi'an's exports far exceed imports, indicating that the local chip manufacturing production lines are operating at full capacity and delivering to the whole world, rather than simply importing equipment for capacity expansion.

The logic of another city, Hefei, is similar, except that the industrial carrier has been replaced by the large-scale overseas expansion of the "new three items" of new energy vehicles, photovoltaics and lithium batteries.

Zeng Gang said that Hefei's export growth is driven by physical products off the production lines of local factories, rather than entrepot trade or simple fluctuations in trade figures.

After Nanjing, Who Is the Most at Risk?

In the first three quarters, 12 of the top 20 cities had growth rates lower than the national level, which is exactly the same as the situation of "12 cities below the average" in the first half of the year.

It is worth noting that in the first half of this year, Nanjing was the only city among the top 20 foreign trade cities that recorded negative growth. It is not unexpected that it dropped out of the list three months later.

Among the current top 20 cities, Tianjin also registered negative growth.

Tianjin's total import and export volume in the first three quarters decreased by 0.5% year on year, of which imports decreased by 7.3%, but relying on the positive growth of 5.7% in exports, it secured the 16th position.

Nanjing is the one that fell behind. In the first three quarters, Nanjing's total import and export volume decreased by 1.6% year on year, of which exports decreased by 3.1%, and finally fell 42.7 billion yuan behind Yantai, the 20th-ranked city, dropping to the 21st position.

However, the suspense remains: Nanjing's import and export volume in the third quarter alone reached 142.8 billion yuan, more than 4 billion yuan higher than Yantai, the 20th-ranked city.

In other words, Nanjing lost out due to the accumulation in the first half of the year, and its volume in the single third quarter has surpassed Yantai. Therefore, the competition for the 20th place in the fourth quarter is far from over.

Zeng Gang said that the regional differentiation of export growth in the fourth quarter will revolve around the stage of the industrial cycle. Import-driven and export-driven are not mutually exclusive, but the focus varies from city to city.

The picture of foreign trade growth in the fourth quarter is not a simple question of "import or export", but who is in a better position to convert imports into output.

This article is from the WeChat Official Account "Time Weekly" (ID: timeweekly), written by Wang Chenyuan, and published with authorization from 36Kr.