Before the technology boom in the 1990s, the discovery of new gadgets was celebrated as decade-long inventions. Today, with enough skill and resources, gadgets, apps, and platforms are created daily across the world. In China, gunpowder, the compass, printing, and papermaking are known as The Four Great Inventions attributed to Chinese inventors. Since then, China has made leaps in the fields of science and technology. From forming the city of Shenzhen as today’s manufacturing hub of Global 500 companies to growing the number of scientists in the city of Nanjing, China has become top of mind for tech firms, students, and venture capitalists.
After the initial discovery of The Four Great Inventions, science and tech were neglected as the succeeding government’s prioritized military and trade. It was only in 1976 when Deng Xiaoping included science & tech in his Four Modernizations that support for the industry returned. By 1995, a National Science & Tech development plan was outlined calling State institutions, universities and private companies to contribute to the development of the industry to affect economic growth. Today, the support of the Chinese government has been critical in fostering the continues contribution to innovation from all sectors.
In 2015, the Chinese government spent $213.4 Billion on research and development – including investments in infrastructure and education. The proliferation of universities has resulted in not development not only on the national scale but also on the microeconomic perspective of individual cities growing rapidly. One example of this is Nanjing. At its peak, it was one of the Four Ancient Capitals of China and the center of all political affairs. At its lowest point, it was the site of massive atrocities during the Rape of Nanking.
Through resilience and a commitment to growth, it is now considered the center of culture, science, history, and business. Though still under the radar of foreign investments, the city attributes its success to the success of local companies such as Nari. Nari employs over 10,000 scientists and engineers in its research institute and recorded over RMB 22 Billion in revenue. Government incentives for high-tech and research firms like Nari have led to the increase of local-bred startups and multinational companies.
Built in an apartment in Hangzhou, Alibaba is considered today as one of the most valuable e-commerce company in the world. With millions of merchants and a continuously growing database of customers, Alibaba has redefined the market of purchasing and selling products. With a $25 Billion IPO at the New York Stock Exchange, analysts believe it will only be a matter of time until Alibaba reaches its target of one billion users. In a recent meeting with President Trump, Alibaba founder Jack Ma announced it would utilize its success to generate jobs in the US. He warned, however, that this would only materialize if President Trump maintains fair and mutually profitable trade policies with China.
In the city of Shenzhen, one can find Huaqiangbei, the world’s largest electronics market. From knock-offs to collectibles, this market is a haven for tourist, locals, and techies across the world. Local entrepreneurs, like Eric Pan from Seeed Studio, attribute the success of startups and Fortune 500 companies to accessible raw materials and markets. Deemed China’s Silicon Valley, Shenzhen has been lauded for contributing to the increase of foreign investment in China as both foreign companies and entrepreneurs have invested time and resources to growing the local and international technology market.
Good Business Climate
In the past few years, multinational companies have ventured to China to manufacture products in a more efficient and cost-friendly way. Global technology companies like Apple, for instance, have outsourced their production of iPhones and iPads to factories in Shenzhen due to the convenient access to raw materials, factories, and technicians. On the other end, Cisco has invested $2.9 billion in a research and development project based in Guangzhou. The American IT giant plans to train workers and offer opportunities to local thereby helping both economies. Other startups such as Helios and HAX8LR8R have also found success in expanding their economies through the technology ecosystem in Shenzhen.
This coming December, the city of Guangzhou, China will host the 2017 Fortune Global Forum with the theme of “Openness and Innovation: Shaping the Global Economy.” For three days, government leaders and CEOs will come together to explore opportunities for growth and partnership.