Shanxi's economy recovering quickly in wake
 of pandemic

Workers assemble new energy vehicles at an automobile plant in Yuncheng. The advanced manufacturing industry in Shanxi reported strong growth in the first quarter of this year. RUAN YANG / FOR CHINA DAILY

Workers assemble new energy vehicles at an automobile plant in Yuncheng. The advanced manufacturing industry in Shanxi reported strong growth in the first quarter of this year.

North China's Shanxi province reported a year-on-year GDP increase of 17.3 percent in the first quarter of 2021, showing a strong recovery for an economy that was seriously affected by the COVID-19 pandemic last year.

The Shanxi Statistics Bureau's data show that the province's GDP reached 446.4 billion yuan ($69.5 billion) in the first three months.

Wang Yumin, an official at the bureau, said the growth has been achieved as a result of the negative growth in the first quarter of last year. He said it is more objective to compare the 2021 numbers with figures from the same period in 2019.

The first quarter of 2020 saw Shanxi's GDP fall 3 percent year-on-year to 363.5 billion yuan, or a decrease of 11.24 billion yuan.

"Combining the rates of the last two years, the year-on-year first-quarter growth rates in 2020 and 2021 were 5.8 percent on average,"Wang said.

"Both the increase of 17.3 percent from the same period of last year and the average rate of 5.8 percent are higher than the national figures,"Wang said. "This marked a strong beginning for the 14th Five-Year Plan (2021-25)."

Compared with GDP growth, Wang said the local authorities are focusing more on growth potential and quality of economy.

"One important index for economic potential and quality is consumer confidence," the official said.

Retail sales of consumer goods in Shanxi increased 43.5 percent year-on-year in the first quarter, 9.6 percentage points higher than the national average.

Wang said the consumer goods retail sector was among the first in Shanxi to recover from the COVID-19 pandemic. "Many retail companies maintained growth even in the first quarter of last year."

The growth can also be attributed to local retailers' use of online sales in a time when the number of visitors to brick-and-mortar outlets was restricted for pandemic control and prevention, Wang said.

Gao Jianfeng, a researcher at the Shanxi Academy of Social Sciences, said improvement in consumer confidence is especially important when Shanxi, as well as the entire country, is implementing a new development pattern that highlights domestic market demand.

"Shanxi is experiencing an upgrade in consumption, which is driven by the increase of its middle-class population, the development of a wider-covering social security system and the stimulative policies from the State and the province," Gao said.

While Shanxi's economy is driven by consumer demand, the upgrade of the supply side is also contributing to a higher quality of development, according to Wang.

Shanxi is implementing an economic transformation that highlights the cultivation of emerging industries and the use of high technologies to upgrade its traditional industries.

"We are seeing sustained growth in both emerging and traditional industries," Wang said. "And the integration of the two fronts is contributing a joint force to driving the high-quality development of Shanxi.

"The output value of the advanced manufacturing industry in Shanxi increased 25.3 percent year-on-year in the first quarter, while the growth rate of strategic emerging industries reached 29.4 percent, both much higher than the GDP growth."

Traditional sectors including coal mining, coal-based chemicals and building materials have all reported higher-than-GDP growth rates, according to Wang.

Industry insiders said the growth of such sectors is a result of upgrades in technologies and operations across many companies.

Lu'an Coal-based Clean Energy, based in the city of Changzhi, is one such company.

"We are a company developed from a coal producer," said Ren Chao, vice-president of the company."High-sulfur-content coal used to be our pillar product, which sold at about 300 yuan a metric ton."

The executive said the coal variety is referred to as "stinky coal" as it emits the stinky odor of sulfur dioxide when it is burned. "Its market share continues to shrink due to its low combustion efficiency and the pollution it creates."

The company began to diversify its production about seven years ago and is now one of the major coal-based chemical companies in Shanxi.

By YUAN SHENGGAO