How China's rebased universities can power innovation

Winston Mok says rebasing some of China's top universities outside Beijing will ensure a better match between knowledge creation and its application, making innovation possible

PUBLISHED : Monday, 13 April, 2015, 12:30am
UPDATED : Monday, 13 April, 2015, 12:30am

To promote innovation as a national strategy, Beijing recently announced a set of comprehensive measures. Just as important are perhaps what were left implicit: the broader context - in progress - of the rule of law and anti-corruption. Without a level playing field where one's rights are protected, innovation cannot flourish. Why make the effort to innovate if there are surer ways to make money through connection or corruption? Innovation policy may be effectively implemented only in a rule-based meritocracy.

It is perhaps no accident that Shenzhen is often recognised as the most innovative city in China. Seen as a place of "equal opportunities" with fair rules, it has attracted talent from all over the nation. More than the hardware capital of the world, Shenzhen demonstrated its creative drive in a groundbreaking CGI movie just released. Through innovation, Shenzhen's Nanshan district has achieved per capita gross domestic product higher than that of Hong Kong.

In the vein of a Silicon Valley-type innovative ecosystem, Beijing would like to cultivate the integration of industry, research and academia. But currently, there may be mismatch of resources and opportunities - knowledge creation is detached from knowledge application. Top universities and leading research institutes are concentrated in Beijing, while the Yangtze River Delta and the Pearl River Delta have the most vibrant economies.

Proximity to industry facilitates adaptive innovations. Advances in robotics, for example, can best happen in a manufacturing environment. Given the concentration of China's technology industries at the Yangtze River Delta and the Pearl River Delta, they are natural centres of innovation. Jiangsu and Guangdong have consistently been ranked as the mainland's most innovative regions, followed by Beijing, Shanghai and Zhejiang .

Beijing is the unrivalled academic centre of China, with 26 of the more than 100 top-tier universities included in the so-called "211" project, a national drive for academic excellence. It has most of the top national-level research institutes. But the sheer concentration of brain power is not enough. Although Beijing tops knowledge creation, it is weaker in knowledge acquisition and corporate innovation.

Shenzhen lacks elite universities established there. Guangdong's top universities are all in Guangzhou. Shenzhen's ambition to develop its new South University of Science and Technology to a world-class institution will take decades to realise. Besides branch campuses of elite mainland universities and the Chinese University of Hong Kong, Shenzhen is bringing in foreign programmes from the US, Australia and Ireland.

The Yangtze River Delta, where the mainland's most innovative cities are concentrated, seems to have the best balance, with more than 20 top universities. While the Yangtze region may appear a close second to Beijing for the presence of elite universities, they are spread over five cities over a much wider area and larger population base. The region, pioneer in bringing in foreign universities, is expanding its network of transnational branch campuses.

Importing foreign institutions are attempts by these affluent regions to address the imbalances in academic resources. But many such branch campuses are teaching rather than research-focused. To overcome the mismatch, a more fundamental way may be redeploying some of China's top universities.

Even if half of Beijing's 26 elite universities were to be relocated, it will still have more than runner-up Shanghai's 10, and three times Guangdong's. While Peking University and Tsinghua University will realistically stay in Beijing given their historical legacies, many other top universities may be better leveraged elsewhere. In parallel, more resources may be allocated to significantly upgrade universities in key economic regions outside Beijing.

Moving universities away from Beijing will likely be met with stiff resistance from their faculties. Such understandable resistance may be mitigated if the destinations are attractive cities, with fresher air, in the Pearl River Delta or Yangtze River Delta.

Faculty members could be provided with quality staff housing at attractive terms. Excellent primary and secondary schools may be developed adjacent to the new campuses. Importantly, their children could remain with the Beijing pool for preferential admissions to universities in Beijing.

Relocating some universities from Beijing will alleviate traffic congestion. Vacated campuses may be redeveloped to address the housing needs of workers at hi-tech enterprises in the university district. Some spaces may be made available for start-ups, incubators and technology parks. The Beijing municipal government is unlikely to resist too strongly the huge windfall in land value, or the expansion of the tax base in the longer term. Far from undermining Beijing's leadership role in technology, such relocations will make it stronger as a centre of innovation.

China will not become a truly innovative nation by making Beijing its innovation centre. It will get there by cultivating a dozen innovative cities. To that end, shifting some top universities from Beijing to China's leading industrial regions may be a good start. Although toilsome and complicated, it is also one of the few levers left to make Beijing a more liveable city.

Winston Mok is a private investor, a former private equity investor and McKinsey consultant. An MIT alumnus, he studied under three Nobel laureates in economics