How Silicon Valley gurus shaped Shenzhen’s rise

Business town: Staff members work on the production line at the Foxconn complex in Shenzhen, China.

Outside Shenzhen’s bustling Huaqiangbei market, a mecca for bargain-hunters addicted to gizmos, video games and much more, crowds gather around toy vendors, haggling for the best price. Loud music blares in the background, forcing the buying and selling to a much higher decibel.

But beyond the noise, a generational shift in market demand is equally eye-catching. Most of the toys are cheap plastic imitations of real drones— a signature industry of Shenzhen. Remotely controlled copies of flashy fighter jets are also a market favourite.

It is evident that popular imagination in Shenzhen is now well attuned to the city’s transition towards a sophisticated economy, of which aviation is one of the major planks.

“We are moving towards the future industries — the examples include a combination of biotech and hi-tech. Aviation is a part of it,” says Yao Weizhi, Deputy Director General in the Shenzhen Foreign Affairs Office.

Shenzhen’s focus on a new wave of industrialisation is being guided by the Industry 4.0 model, pioneered by Germany. In China, that has included emphasis on developing 10 major cutting-edge industries.

These cover advanced IT, including internet-of-things, robotics, bio-medicine, aerospace and aeronautics, new energy vehicles, and new materials.

New ecosystem

Serial experimentation and openness to new ideas since 1979 have generated an ecosystem that allows Shenzhen to frontline China’s industrial turnaround.

“I remember in 1991 when I was part of a delegation to the United States led by our city mayor,” recalls Mr. Yao. “We spent a day with the chairman of Hewlett Packard who explained to us how the entire San Francisco bay area was raised from scratch to become a hi-tech icon. We also met the President of Stanford University, and other experts who told us how the Silicon Valley was created. That left a very strong impression.”

Following the visit, Shenzhen’s master plan was changed. “Since 1983, we had quite a bit of land available in our city’s university area. That was converted into a hi-tech industrial park, which subsequently led to a high concentration of hi-tech industries. In turn, it created real wealth for China, comparable to the scale of Silicon Valley,” says Mr. Yao.

Experts from Singapore, a coastal city-state that had risen from scratch, also provided important lessons that furthered Shenzhen’s rise. Besides, local business leaders played a major part in Shenzhen’s transformation. “In 1984, I visited Huawei, wanting to know if they needed support from the local foreign affairs office. They then had only a two-storey assembly line, employing 400 people. Today, they deliver jobs to 180,000 people, and are one of the global pioneers in the hi-tech arena,” observers Mr. Yao.

Success model

In the city’s dense steel-and-glass business district, Skyworth, a producer of white goods, is set for a jump to the next level. Diversifying from a supplier of subsystems to big brand names, the company has entered the international market, including India, on its own steam.

The success of the Shenzhen model has had unintended consequences as well, including encouraging the idea of the Maritime Silk Road (MSR)—President Xi Jinping’s pet project.

Analysts say Shenzhen provides China with a ready model for adaptation in its drive to develop new coastal hubs in the Indian Ocean countries and and others along the African coastline, as part of the MSR.

[Source:-The Hindu]

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