Greater Bay Area: In-depth Study by DBS Bank Group Research

Group Research / May 15, 2019

Our analysts took a deep dive to examine opportunities and challenges to come as the Greater Bay Area (GBA) embarks on its journey to become China’s newest innovation and technology hub.

Despite strong economic growth over the past decades, the Greater Bay Area (GBA) – excluding HK and Macao – is still being viewed as a manufacturing- driven economy. This explains why its wealth level is only 25% to 50% of other global bay areas. We expect the services sector to lead economic growth going forward, with its GDP contribution to rise from 57% (66% incl. Hong Kong and Macau) to 72% (and 76%) by 2030. With this transformation, we estimate that population in the region will expand from 70m currently to over >100m in 2030; GDP per capita is estimated to double and catch-up with Tokyo Bay area, creating tremdous opportunities for companies in this area.

We have performed an analysis to identify the potential of each industry in the GBA region, based on near-term (2022) and long-term (2030) growth (CAGR). Our rankings show that high value-added manufacturing such as new energy vehicles (NEV), smart appliances, consumer Internet of Things (IoT) hardware and environmental products will lead near-term growth. In the long-term, growth will also be driven by online ads, finance services, healthcare, warehouse, office and education services; similar to global peers as the services industry flourishes.