In June, JLL published a report, “Redefining the Greater Bay Area’s Industrial Network and Spatial Distribution”. We begin by examining spatial patterns of urban development and then take a deep dive into the GBA’s future industrial network from several perspectives, including clusters, belts and industrial nodes. Here are the three main conclusions from the report:

1^st Conclusion: The new growth engines generated in the inner ring will help optimise the region’s spatial distribution, with Nansha, Qianhai, Hengqin, Binhai Bay New Area and Cuiheng New District emerging as key development nodes.

We focus on the double-ring development mode of the GBA. The outer ring, comprising the Guangzhou-Shenzhen Science and Technology Innovation Corridor (the “East Ring”) and the Advanced Equipment Manufacturing Industrial Belt on the west bank of the Pearl River (the “West Ring”), has begun to take shape. Focusing on modern services and advanced manufacturing industries, the inner ring will be driven by several key areas including Qianhai in Shenzhen, Nansha in Guangzhou, and Hengqin in Zhuhai. Although both rings are still at an early stage of development, we expect them to generate fresh momentum to the economic development of the GBA.

The five development nodes connect to form a semi-circular development axis around the bay. Driven by modern services industries and advanced manufacturing units, this industrial development axis is planned to become a new economic growth engine for the GBA, integrating both secondary and tertiary sectors. At the same time, the newly introduced modern services industries in the inner ring will drive further growth of peripheral manufacturing nodes.

Figure 1: The double-ring development model of the GBA

Source: JLL Research

2^nd Conclusion: Core cities will experience a multi-centric development model, boosting the competitiveness of their major industries

Helped by the increased density of road and metro network, the economic boundary of the cities has continued to expand outward, and core cities in the GBA are increasingly open to the concept of developing multiple CBDs. The geographic locations of these new centres should satisfy one of the following conditions: 1) the intersection of GBA’s axes and city’s concentric zone; 2) the intersection of GBA’s axes with the city’s axes; or 3) intermediate nodes between the outer and the inner rings.

Figure 2: Spatial pattern of multi-centric development mode in Guangzhou

Source: JLL Research

3^rd Conclusion: As related nodes grow, the interaction between industries will affect the GBA’s industrial network, leading to a regional hub for the high-tech industry

The member cities in the GBA have great potential to create synergies through by leveraging on their respective advantages. We believe thata well-coordinated industrial system will better support internal flow of goods, and these six primary modes will drive the interactions between industries in the GBA:

Figure 3: Six primary modes of interactions between industries in the GBA

Source: JLL Research

The GBA will see changing relationship between the advanced manufacturing industry and the modern service industry. In the past, the manufacturing industry was a major demand driver for modern service industries such as finance, insurance, and professional services. Going forward, we expect the growth of the modern service industry to drive the manufacturing industry.

Figure 4: A rainbow belt of interactions between industries across the GBA

Source: JLL Research

Led by core cities and connected with key infrastructure, a “rainbow belt” of interactions between industries with multiple major nodes is emerging across the GBA.

As industries scale up and build their networks, all nodes are expected to develop their own growth engines. This further strengthens the existing competitive advantages of the GBA, enabling high-end industries to foster in this geographical area.

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