– Xiamen failed to achieve its GDP target of 1 trillion yuan by 2025, with output reaching 898.037 billion yuan, delaying its entry into China’s elite economic club.
– Structural weaknesses, including a declining industrial base and over-reliance on real estate, are critical challenges that hinder growth.
– The city is pivoting towards advanced manufacturing as a core strategy, drawing lessons from peers like Shenzhen to drive future competitiveness.
– Urban spatial adjustments, such as cross-island development and new industrial zones, are essential to support industrial expansion and population redistribution.
– Investors should monitor policy initiatives and investment trends in Xiamen’s key sectors for opportunities in its transformation journey.
With Dalian officially joining the ranks of China’s trillion-yuan GDP cities, Xiamen stands alone as the only planned separate city yet to cross this prestigious threshold. The pressure is palpable as Xiamen’s 2025 target of breaking the 1 trillion yuan barrier has fallen short, with GDP reaching 898.037 billion yuan, a 5.7% year-on-year increase. This delay not only extends the timeline for economic milestone achievement but also underscores the urgent need for a structural overhaul. In this context, advanced manufacturing emerges as the pivotal focus phrase, offering a pathway to revitalize Xiamen’s economy and secure its place among China’s top-tier urban centers.
The Missed Trillion-Yuan Target: Xiamen’s Economic Crossroads
Lagging Behind in the Planned Separate Cities Cohort
Xiamen’s failure to meet its GDP goal highlights its precarious position among China’s five planned separate cities—Shenzhen, Qingdao, Ningbo, Dalian, and Xiamen. These cities, designated for independent economic planning, represent hubs of innovation and growth. According to data from the Xiamen Municipal Bureau of Statistics (厦门市统计局), the city’s 2025 GDP of 898.037 billion yuan fell short of the 1 trillion yuan mark, despite a 5.7% growth rate. Xiamen Mayor Wu Bin (伍斌) has indicated that achieving this target may now take until the “15th Five-Year Plan” period, emphasizing the need for accelerated efforts. Compared to peers, Xiamen’s economic scale is modest: its GDP is roughly one-third of Shenzhen’s and half of Qingdao’s, reflecting deeper structural issues.
Industrial Weaknesses Exposed
A key factor in Xiamen’s underperformance is its industrial sector, particularly manufacturing. The secondary industry’s share of GDP has declined from 50.6% in 2011 to 36.6% in 2024, with 2023 seeing a 2.8% drop in added value. This trend contrasts with cities like Ningbo, where manufacturing remains robust, contributing 43.4% to GDP in 2024. Professor Ding Changfa (丁长发) from Xiamen University (厦门大学) notes that Xiamen lacks large-scale industrial projects in sectors like steel, petrochemicals, or energy, which have historically driven growth elsewhere. Instead, the city relied heavily on real estate, but high land costs now constrain manufacturing expansion. The “15th Five-Year Plan” suggestions acknowledge these issues, citing an export-oriented economy, weak industrial foundations, and insufficient advanced manufacturing as critical gaps.
Advanced Manufacturing: The Imperative for Economic Revival
Xiamen’s strategic pivot towards advanced manufacturing is central to its redemption narrative. The city aims to build a modern industrial system with advanced manufacturing as the backbone, as outlined in its planning documents. This focus phrase is not just a buzzword but a necessity for boosting competitiveness and achieving sustainable growth.
Current Rankings and Competitive Landscape
In the 2024 China Advanced Manufacturing City Rankings, Xiamen placed 18th nationally, a respectable position but behind Shenzhen (1st), Ningbo (4th), and Qingdao (6th) among planned separate cities, and only ahead of Dalian (24th). Alarmingly, Xiamen is the only city in this group whose ranking has declined since 2021, signaling eroding competitiveness. The city’s advanced manufacturing sector faces challenges such as a lack of large, leading enterprises. For instance, in 2022, none of Xiamen’s three Fortune Global 500 companies were in manufacturing, and it had no entries in China’s unicorn rankings. While Haichen Energy Storage (海辰储能) broke into the 2025 Global Unicorn 500 list, this “lone wolf” success is insufficient to transform the ecosystem.
Emulating Shenzhen: A Blueprint for Transformation
Shenzhen’s journey from a low-end processing hub to a global innovation center offers a compelling model. Experts highlight similarities in resource constraints and geographic limitations, making Shenzhen’s experience relevant for Xiamen. In December 2025, Xiamen Party Secretary Cui Yonghui (崔永辉) led a delegation to Shenzhen, visiting firms like China Merchants Group (招商局集团) and AVIC Science and Technology (中航科创) to explore collaborations in semiconductors, integrated circuits, and precision manufacturing. This outreach underscores Xiamen’s commitment to learning from best practices and attracting investment in advanced manufacturing. The city plans to add 100 or more large-scale national high-tech enterprises and 25 or more “little giant” specialized SMEs in 2026, aiming to strengthen its innovation pipeline.
Spatial and Structural Adjustments: Reshaping Xiamen’s Geography
Xiamen’s limited land area of 1,700 square kilometers, primarily on an island, necessitates careful urban planning to support industrial growth. The city has long pursued a “cross-island development” strategy, initiated in 2002, to transform from an island city to a bay city.
From Island City to Bay City: Urban Transformation
By 2025, off-island areas accounted for over 60% of Xiamen’s population, fixed-asset investment, and built-up area, marking progress in spatial redistribution. However, challenges persist, with island development nearing saturation and off-island areas still underdeveloped. The “15th Five-Year Plan” proposes a “3+1” urban framework to foster multi-center, clustered growth, moving away from reliance on external拉动 to innovation-driven expansion. Professor Ding emphasizes that this spatial adjustment aims to relocate premium resources—like industries, jobs, and public services—from the core island to new zones, reducing congestion and fostering balanced development.
Industrial Parks and New Growth Poles
New industrial zones are critical to this strategy. The Tongxiang High-Tech New City (同翔高新城), launched in late 2020, exemplifies success: it occupies only 3.35% of Xiamen’s land but contributes half of the city’s industrial investment. From 2020 to 2025, its built-up area expanded from 10.5 to 23.5 square kilometers, becoming a hub for advanced manufacturing. This aligns with broader trends where industrial investment rose to 29% of total investment in 2025, with non-real estate project investment growing by 8.1%, indicating a shift towards productive assets. The integration of industry, urban amenities, and population—termed “产城人融合”—is vital for sustaining growth, as noted by experts.
Policy Responses and Future Trajectory
Xiamen’s government is rolling out targeted initiatives to address economic gaps, with a clear emphasis on fostering advanced manufacturing ecosystems.
Government Initiatives and Investment Trends
The “15th Five-Year Plan” highlights goals like maintaining a reasonable manufacturing share and building a modern industrial system. In 2025, industrial tax revenue accounted for 35.5% of total tax, growing by 6.6%, with advanced manufacturing tax up by 12.6%, showing positive momentum. The city’s “4+4+6” industrial system—focusing on four pillar clusters (e.g., electronics, machinery), four strategic新兴 industries (e.g., biopharma, new materials), and six future sectors—has added three trillion-yuan产业链群 in biopharma, new energy, and materials. Outbound links to policy documents, such as the Xiamen Municipal People’s Government announcements, provide further insights for investors tracking regulatory support.