How China’s ancient capital staked a claim to the nation’s fastest export growth

A booming semiconductor industry is helping drive a surge in trade in Xian, one of China’s ancient capitals, making it the country’s top performer by trade growth among provincial capitals and provincial-level cities for which data is publicly available.

The capital of western China’s Shaanxi province recorded a 115.5 per cent year-on-year surge in trade during the first nine months of 2026. Exports far outpaced imports, climbing 142.1 per cent.

Two product categories drove much of that export growth. Shipments of automatic data processing equipment and parts jumped 388.1 per cent year on year, while integrated circuits rose 251 per cent. Taken together, these categories accounted for 76.5 per cent of total exports.

Zeng Gang, an economics professor at East China Normal University in Shanghai, said the surge reflected booming demand for chips used in artificial intelligence computing, together with Xian’s investment in the memory chip sector over more than a decade.

“Samsung and Micron Technology’s Xian operations stand out as the most immediate driver of this robust expansion, allowing the city to reap the fullest local gains from the global industry tailwind,” Zeng added.

Despite United States-led export restrictions on certain chipmaking equipment destined for China, South Korea’s Samsung and US-based Micron Technology have continued investing in their Chinese operations.

Samsung’s Xian facility is its only overseas memory-chip fabrication plant and produced about 40 per cent of the group’s NAND flash memory chips, according to a March report by the Korea Times. The company invested 465.4 billion South Korean won (US$351 million) in the facility last year, 67.5 per cent more than a year earlier.

Xian’s trade with South Korea also reached nearly 180 billion yuan (US$27 billion) in the first nine months, surging 224.4 per cent year on year and making up 23.5 per cent of the city’s total, according to official figures.

Micron announced back in 2023 that it planned to invest more than 4.3 billion yuan in Xian over multiple years, with the funding going towards buying a local firm and building a new packaging-and-testing facility – a crucial link connecting the upstream and downstream segments of the semiconductor value chain.

Official data showed that foreign-invested enterprises in Xian recorded 588.67 billion yuan in imports and exports for the first nine months, an increase of 174 per cent, representing 77 per cent of the city’s total trade volume.

“Spurred by these two industry leaders, manufacturing clusters have emerged on the outskirts of Xian, solidifying the city’s position in the global semiconductor supply chain,” Zeng said.

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The city’s performance has also helped lift trade across Shaanxi. The province’s total imports and exports surged 111.1 per cent year on year during the first three quarters of 2026, the fastest among provinces for which figures were publicly available.

The outlook for memory chips could also provide further support. In a late September report, market research firm TrendForce said prices were climbing across all dynamic random-access memory (DRAM) segments.

Memory-chip suppliers were continuing to allocate advanced process wafer capacity to high-performance server products in the fourth quarter, sustaining an undersupplied market, according to the report. It projected conventional DRAM prices would climb 10 to 15 per cent from the prior quarter.

Despite the trade boom, however, Xian’s overall economic picture has remained subdued. Official figures showed that the city’s gross domestic product grew by just 1.1 per cent year on year in the first half of the year, 3.6 percentage points below the national average.

Domestic demand in the city also remained sluggish, with total retail sales of consumer goods declining by 3.6 per cent from a year earlier in the January-June period.

Meanwhile, the prospect of a glut in memory chips could pose risks, with Xian’s competitive edge becoming a potential double-edged sword once the market cycle turns, analysts warned.

“This growth model relies heavily on a small group of foreign semiconductor giants. Its trajectory is tied to the global semiconductor cycle, something China cannot control on its own,” Zeng said.

“Xian must grapple with the divergence between its export surge and sluggish local economic activity.”