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Sunday, June 13, 2021 | 04:49 am
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China’s Tech Hub Shenzhen To Invest US$108 Billion in R&D Over 5 Years

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China’s Tech Hub Shenzhen To Invest US$108 Billion in R&D Over 5 Years

Shenzhen is set to invest more than 700 billion yuan (US$108 billion) in hi-tech research and development over the next five years as it seeks to reinforce its position as China’s innovation powerhouse.

Speaking at the city’s annual party congress at the end of last month, Shenzhen’s Communist Party chief Wang Weizhong said that over the 2021-25 plan period, 5 percent of GDP would be allocated to investment in R&D to support innovation and breakthroughs in core technologies.

The city reported a gross domestic product of 2.8 trillion yuan in 2020, but the government has set a target to increase that to 4 trillion yuan by 2025.

Local media reports quoted Wang as saying that artificial intelligence, 6G, quantum technology, driverless vehicles, intelligent networks, and other “frontier areas” would be the focus of Shenzhen’s investment plans, while the value of its digital economy would account for more than 31 percent of GDP by 2025.

Investment in basic research and applied basic research would be not less than 30 percent of the total R&D funding for science and technology, he said.

“By 2050, Shenzhen will represent China in global competition and cooperation, and lead worldwide trends in city development,” he said.

The southern Chinese city has long positioned itself as a center for technology and innovation, with the number of hi-tech companies based there growing by 240 percent since 2015. In a mark of its growing international presence, hundreds of Shenzhen-based scientists were recognized as being among the best in the world in a study published by Stanford University in October.

China’s central government said last year that it wanted Shenzhen to be an engine for the country’s technological reform, and gave it more freedom to recruit talent from around the world. The city, which is already home to about 14,000 hi-tech firms, is also a central part of Beijing’s plans for the Greater Bay Area (GBA) – a scheme to link Hong Kong, Macau with nine cities, including Shenzhen, in Guangdong province.

Chinese electric carmaker Xpeng opened a new R&D center in Shenzhen on Thursday and said it planned to have 500 people working there within 12 months.

Klaus Zenkel, chairman of the southern chapter of the European Union Chamber of Commerce in China, said on Friday that Shenzhen was attracting talented people from around the world.

“We know from other innovation hubs, like San Francisco Bay, that diversity equals innovation,” he said. “The GBA is primed for innovation, so there are good opportunities that European enterprises see this, feel comfortable as they can smell the future business opportunities”.

Despite Shenzhen’s grand plans, Wang said the city still faced many challenges, especially as several of its hi-tech firms remained on a US blacklist that prevented them from buying American-made technology.

“We do not have illusions,” he said. “It will be a struggle to ensure the security of our industrial and supply chains”.

Qu Jian, deputy head of the China Development Institute in Shenzhen, said the increase in R&D would enhance Shenzhen’s status as an innovation center.

“In the next five years, [the city’s] GDP is forecast to increase to more than 1 trillion yuan, but that can only be driven by innovation, by research and development and institutional innovation,” he said.

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