China’s most dynamic local economies are no longer metropolises like Beijing and Shanghai, but lesser-known cities including Hangzhou and Hefei, according to a new report by the Economist Intelligence Unit.
The findings reflect a growing shift in China’s economic landscape, as smaller cities emerge as a main engine of growth due to their strength in advanced manufacturing, clean energy and other emerging sectors.
The annual report by the EIU ranks Chinese cities in terms of their growth potential, with the eastern city of Hangzhou – home to e-commerce giant Alibaba, artificial intelligence start-up DeepSeek, and several other major technology companies – topping the list for the fifth consecutive year.
Shenzhen, often dubbed China’s Silicon Valley, placed fifth, while Beijing, Guangzhou and Shanghai all failed to make the top 10.
The results “capture the rise of manufacturing and the decline of the service sector” in China, economists Xu Tianzeng and Su Yue wrote in the report, as a prolonged property downturn drags down consumer spending and the economy continues to rely on strong production.
