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Greater Bay Area

Guangdong to set up its version of Silicon Valley on the doorsteps of Hong Kong and Shenzhen

Province to introduce 10 policies that show ‘strong support for foreign companies and investment’

PUBLISHED : Wednesday, 22 November, 2017, 10:45am
UPDATED : Wednesday, 22 November, 2017, 10:34pm

China is stepping up its promotion of the “Greater Bay Area” – its version of Silicon Valley – in Guangdong province by offering incentives to foreign capital and companies.

Ma Xingrui, the province’s governor, said that by the end of November the local government will introduce 10 policies to explain how the region will better utilise overseas capital.

“These rules will show our strong support for foreign companies and investment seeking opportunities in Guangdong,” Ma said on Tuesday in Guangzhou, during a meeting with a delegation from Hong Kong. “We will establish an open economy on a higher level.”

The Greater Bay Area, which includes nine Guangdong province cities such as Guangzhou and Shenzhen as well as Hong Kong and Macau, will come to be a centre of technology and innovation, said Ma, adding that foreign businesses will enjoy “equal treatment” with mainland, Hong Kong and Macau enterprises.

Shenzhen is also committed to attracting and serving overseas companies, especially those in Hong Kong. Qianhai, its special economic zone, will have a third of its land left for Hong Kong enterprises, the city’s Communist Party secretary, Wang Weizhong, said on Monday.

“The two cities can further cooperate with each other, combining Hong Kong’s strength in high education and fundamental research with Shenzhen’s industrial advantages,” said Wang. “We would like to provide a platform for Hong Kong’s young people to realise their dream of creating companies.”

Shenzhen spent 80 billion yuan (US$12.06 billion), or 4.1 per cent of its gross domestic product, on research and development last year, almost doubling the national average of 2.1 per cent. Guangdong province also spent a high percentage – 2.5 per cent – of its GDP on research.

China expects GDP in the Greater Bay Area to triple to US$4.62 trillion by 2030 from US$1.38 trillion last year, surpassing the Tokyo, New York and San Francisco metropolitan areas.

“Policy support from the government is a big advantage” for the Greater Bay Area, said Zheng Yongnian, a professor at the South China University of Technology. “Beijing has to facilitate integration among different cities, shifting from competition to collaboration.

“And the market in China is big and still growing fast, which is very important for innovation,” He added. “ Lured by the huge market, the region is always attractive for foreign capital, and China itself is rich so the region has abundance of money.”

However, the lack of international talent is a concern, Zheng said. “I do not think the region is open enough for talent introduction,” he said. “Shenzhen and Guangzhou mostly attract talent from China but not many from internal regions. However, the US’ Silicon Valley has talent from all over the world, not just from the US domestic market but India, China and Europe, etc.”