Shandong - A profile

This article provides an overview of Shandong for those keen on exploring the possibility of living and working there. The information presented is gathered from open sources and is not exhaustive or meant to supplement or substitute legal and professional advice.

Key Facts

• Land area: 157,900 sq km¹
• Population (2022): 101.6 million²
• Provincial capital: Jinan
• Gross Regional Product (GRP) (2022): RMB 8,743.5 billion³
• GRP per capita (2019): RMB 86,003⁴

Introduction

Shandong province is located on the eastern coast of China. It borders Tianjin and Hebei to the north, Henan to the west, and Anhui and Shandong to the south. The province has a well-developed rail network system comprising the Beijing-Shanghai Railway, Beijing-Kowloon Railway and many other high-speed railway lines. It also has seven civil airports and 24 harbours, including Qingdao Port.⁵

Economy

In 2022, Shandong’s economy was the third largest in China, after Guangdong and Jiangsu.⁶

Industries

Heavy industry accounts for more than 67 percent of Shandong’s gross industrial output. The five main industry sectors in Shandong (by share of a value-added industrial output in percentage terms) are raw chemical materials and chemical products (10.3 percent), processing of oil, coal and other fuel (10 percent), processing of food from agricultural products (6.1 percent), manufacturing and processing of non-ferrous metals (5.1 percent) and production and supply of electric power and heat power (5.1 percent). The province also produces almost 12 percent of China’s total crude oil output. Agricultural production includes apples, peanuts and vegetables.⁷

Major cities

Jinan, Qingdao, Weifang, Weihai, Yantai and Zibo are some of the major cities in Shandong province.⁸

Jinan

Jinan is the capital city of Shandong province. In 2019, its population was 8.91 million. Its GDP was RMB 944.3 billion in 2019.⁹ It is also known as the City of Springs due to the presence of over 800 natural springs around the city.¹⁰ Jinan is one of China’s first three software cities, the other two being Chengdu and Nanjing. Its economic focus is on logistics, water management, ICT, healthcare and machinery equipment.¹¹

Qingdao

Qingdao is Shandong’s economic centre. In 2018, it had a population of 9.5 million. Its GDP in 2019 was RMB 1,174.1 billion.¹² It was also the fifth largest container port in China in terms of throughput and home to well-known Chinese brands such as Tsingtao Beer and Haier.¹³ Many foreign companies operate there, including ANZ Bank, HSBC, and and Yamaguchi Bank Ltd, to name a few.¹⁴ Its main industries include logistics, shipbuilding and marine technology, ICT, water management, healthcare, wealth management, tourism, and fishery.

Weifang

Weifang is located in central Shandong. In 2019, it had a population of 9.35 million, while its GDP achieved RMB 658.9 billion in the same year.¹⁵ Some of the city’s main industry sectors include agriculture, food and beverage processing, machinery equipment, textiles and chemicals.¹⁶ Shouguang, a prefectural city of Weifang, hosts the annual China International Vegetable SciTech Fair.¹⁷ The city is regarded as China’s vegetable capital while Qingzhou, another prefectural city of Weifang, is famous for its horticulture.¹⁸

Yantai

With a GDP of RMB 765.3 billion and a population of 7.14 million in 2019, Yantai is Shandong’s largest industrial city.¹⁹ It is known as “Fairyland on Earth” and “City of Wine”²⁰ and an export base for agricultural products such as apples, peanuts and vegetables.²¹ It is home to a large number of auto parts manufacturers, as well as companies specialising in logistics, shipbuilding and marine technology, chemical, electronics and IT, and agro-food.²²

Foreign Trade and Foreign Investment

Shandong’s major exports comprise machinery, electronics, textiles, garments, chemical products, plastics and related products, base metals and related products. Major export markets include the United States, Japan and South Korea. Its major imports include minerals, machinery and electrical equipment, seeds and fruits, plastics and related products. Around 44.7 percent of foreign investments in Shandong are centred mainly on the manufacturing sector in 2018. Singapore is one of the major investors in Shandong.²³

Consumer Market

In 2019, Shandong was the second largest consumer market (in terms of retail sales after Guangdong. Retail sales of consumer goods reached RMB 3,577.1 billion, accounting for 8.7 percent of China’s total. Annual per capita disposal income of urban households was RMB 42,329 in 2019.²⁴

Tourism

Shandong is a popular tourist destination. In 2019, it attracted 859 million domestic tourists and 5.13 million overseas tourists.²⁵ Shandong was the birthplace of influential cultural and historical figures such as Confucius and Mo Zi, and is also home to four UNESCO World Heritage sites: Mount Tai, Temple and Cemetery of Confucius and the Kong Family Mansion in Qufu, the Grand Canal and the Great Wall of Qi, which forms part of the Great Wall of China.²⁶

Singapore and Shandong

The Singapore-Shandong Business Council (SSBC) was the first council to be established between Singapore and Shandong. It was the result of a mutual desire to strengthen economic and trade cooperation by both Singapore and Shandong. Singapore-Shandong bilateral economic and trade relations has grown steadily over the years. Total trade between Singapore and Shandong amounted to RMB 7.28 billion in the first half of 2019, with actual investment worth.²⁷

SSBC has identified the trading of food products as one potential growth area. Shandong is the leading agricultural province in China and the top exporter of agricultural produce to Singapore among the Chinese provinces. Key products exported to Singapore include apples, pears and Chinese cabbages. “There is opportunity for Singapore traders and distributors to import a wider range of produce from Shandong that are in demand in Singapore, especially premium fruits and vegetables such as cherries and black garlics. For example, Singapore company Siji Trading is collaborating with NTUC Fairprice to promote Shandong fruits and vegetables in their outlets.”

Another area that Singapore companies can also partner Shandong in is the sustainable development, as the province steers its traditional industries such as oil & gas towards more environmentally sustainable practices. These include water and waste management, optimisation of energy utilities and the upgrading efforts of refineries to improve operational efficiency and quality of products. For example, Singapore Vac-Tech Engineering is partnering Yantai’s oilfield services company, Jereh Group, to customise an advanced tank cleaning solution to achieve greater efficiency. The solution is currently undergoing test-bedding on Singapore’s Jurong Island, and will potentially be deployed in Shandong and other markets.²⁸

References