Shenzhen, Beijing and Hangzhou: China’s hi-tech frontrunners

27/04/2018

Each of these three cities has a unique role in China’s IT – which one deserves to be called China’s Silicon Valley?

 

According to a recent National Survey Research Center poll conducted at Renmin University in Beijing, there is no single Silicon Valley in China. This may come as a letdown, but let’s be clear – the business models employed by Beijing, Shenzhen, and Hangzhou operate in three distinct sectors. Shenzhen focuses on hi-tech, Hangzhou is home to the dotcoms, and Beijing is the incubator for the country’s most prestigious startups.

The Chinese tech race is fueled by long-term economic development policies centered on the five-year plan launched in 2015. Internet Plus project and Made in China 2025 are just the tip of the iceberg, and perhaps the best known of these leadership plans.

 

Shenzhen is home to tech manufacturing, automation, and the robots that will fill tomorrow’s factories

 

For investors and businesses looking for Chinese property and partners, it pays off to know the identity of these three tech titans. Shenzhen sets the benchmark for tech manufacturing, and Beijing offers the most qualified talent pool for companies focused on innovation, R&D. Hangzhou is best-suited for e-commerce as the home to Alibaba, its attractive locale, and lower operating costs.

Shenzhen – the fishing village turned megalopolis of China’s South – became a Special Economic Zone in 1980. According to the 13th Five Year Plan, this city will spend 5% of its annual GDP BY 2020 replacing traditional factories with automation. The cutting edge of robotics, hardware, and manufacturing passes through Shenzhen before hitting the global markets.

 

Beijing fuels brain drain by welcoming skilled professionals with new ten-year visa

 

The northern district of Beijing, Haidian, is home to the Silicon Valley of the north. Flanked by tall skyscrapers inhabited by Stone Group, Lenovo, and Baidu, this region is attracting still more hi-tech companies including Intel, Oracle, and Sony. Microsoft built a US$280 million research lab with over 5,000 employees in Beijing, and even Google has inaugurated a research lab with the support of the city government.

Perhaps most exciting of all for foreigners looking to get a piece of China’s tech innovation is the inception of the ten-year working visa. Beijing is preparing to welcome those skilled professionals fleeing other countries who are highly qualified in their fields.

 

Hangzhou is home to Alibaba, Kaola, and e-commerce

 

Hangzhou can thank Jack Ma for putting it on the map. As home to Alibaba, Hangzhou has earned the title of ‘e-commerce capital of China’. In April 2016, the government designated the city as one of China’s 10 cross-border e-commerce pilot cities giving it preferential status to facilitate tax policy and handle foreign goods.

Together with Shanghai, Hangzhou forms the Economic Zone of the Yangtze River Delta, one of the most dynamic and innovate clusters in China, which is why Hangzhou will be the location for our very own Cifnews CCEE conference next June. CCEE is aimed at companies that want to enter China’s New Retail market and is sponsored by the Ministry of Commerce of Zhejiang Province.

 

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