By ZH Sailing Research | March 2026
Liuyang, a county-level city in Hunan, long famed for its 1,400-year-old fireworks tradition, is transforming a seasonal, labor-intensive craft into a high-tech, environmentally friendly, and culturally immersive industry.
From Cottage Industry to High-Tech Production
Historically, families in Liuyang manually mixed black powder and assembled fireworks shells, combining artisanal skill with serious safety risks and pollution. Since privatization and restructuring in 1998, the city has centralized production and embraced digital and green technologies:
200+ companies completed digital upgrades.
20 fully automated demonstration lines now operate citywide.
66,000 AI-enabled cameras feed a centralized risk-warning system.
Dangerous chemical-handling processes now follow human-machine separation, reducing worker exposure.
Fireworks now use single-base powder, plant-fiber materials, and micro-smoke technology, reducing emissions and post-combustion residues by ~80%.
Cultural and Emotional Economy Boosts Growth
Liuyang has integrated fireworks into cultural tourism, turning displays into a year-round attraction and leveraging China’s emotional economy:
China’s emotional economy reached 2.7 trillion yuan ($380 billion) in 2025, projected to exceed 4.5 trillion yuan by 2029.
Liuyang hosted 142 major weekend displays since 2023, drawing 7 million visitors annually.
Tourists generate over 20 billion yuan in local spending on hotels, dining, and cultural products.
Moving Up the Global Value Chain
Firms now deliver full entertainment solutions, not just products:
Fireworks displays combined with augmented reality and cultural workshops.
Independent Liuyang brands now account for 40%+ of exports.
In the US market, Chinese-owned brands contribute over 50% of sales, despite trade tensions.
Example: China Galaxy Pyrotechnics Co Ltd organized a 62-minute New Year’s Eve display in Abu Dhabi, setting four Guinness World Records while keeping the desert sky clear with micro-smoke technology.
Shaping Global Standards and Expanding Logistics
Liuyang influences the global fireworks sector:
China hosts the ISO/TC264, with Liuyang contributing 22 international standards (≈70% of the global total).
Local authorities are exploring new logistics routes, including a China-Europe rail freight service, to overcome export bottlenecks.
Key Takeaways
Innovation meets heritage: Digitalization, automation, and green technology modernize ancient craftsmanship.
Cultural and emotional economy integration: Transforms seasonal products into year-round attractions.
Global competitiveness: Exports evolve from simple products to turnkey experiences and brands.
Resilience: Safety, environmental measures, and diversified logistics ensure long-term sustainability.
Key Data
Domestic market share: ~60% of China’s fireworks market
Export share: ~70%
Major displays since 2023: 142
Annual visitors: 7 million
Related local spending: 20+ billion yuan
International standards contributed: 22 (≈70% of global total)
Source: Liuyang fireworks associations, iiMedia Research, Hunan Department of Commerce
Market Implications
Sustainable modernization: Digitalization, automation, and green innovation increase safety and efficiency.
Revenue growth via experiences: Emotional and cultural consumption drives domestic and international demand.
Global leadership: Turnkey solutions, independent brands, and international standards strengthen competitive position.
What Investors Should Watch
Expansion of automated, AI-enabled production lines
Growth of cultural tourism-driven revenue streams
Adoption of green pyrotechnics technologies
Global market penetration of Liuyang turnkey fireworks solutions
Influence on international standards via ISO/TC264