Shenzhen

James Laurenceson, Deputy Director, Australia-China Relations Institute, University of Technology Sydney

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Can China become an innovation-led, high income country? Shenzhen, a Prefecture-level city bordering Hong Kong SAR, provides some answers.

1. In 2014 Shenzhen’s per-capita income was RMB149,497, or $US24,259.[1] In Nanshan district, described by Bloomberg as the technology heartland of Shenzhen, it was $49,730.[2] This compares with:

• The World Bank threshold for classification as a high-income country in 2014 of $12,735.[3]
• OECD countries such as Portugal: $22,132 and Korea: $27,971.[4]
• Hong Kong SAR: $40,170 and Singapore: $56,285.[5]

2. Previously known as a low value-added manufacturing hub, in 2014 the services sector accounted for 57.3 percent of Shenzhen’s GDP.[6] 

3. In 2014 Shenzhen displaced Hong Kong SAR to become ranked as Greater China’s most competitive city. Hong Kong SAR had previously held the top spot since 2005.[7]

4. In 2015 Shenzhen was named as a global top five start-up hub for the future by US magazine Inc., a publication focusing on small and medium fast-growing businesses.[8]  

5. In 2014, research and development expenditure accounted for 4.02 percent of Shenzhen’s GDP. [9] In Hong Kong SAR it was 0.74 percent.[10]

6. In Patent Cooperation Treaty applications, Shenzhen hosts five companies that rank in the top 50.[11]  

7. Shenzhen now serves as the global headquarters of leading manufacturing and tech companies including: [12]

• Tencent, which has over one billion monthly active users across its desktop platform QQ and mobile instant message app Wechat.
• Huawei, the world’s largest telecommunications equipment manufacturer.  
• BGI, the supplier of 50 percent of the world’s gene sequencing capacity.
• BYD, the world’s largest supplier of rechargeable batteries.
• DJI, which produces 70 percent of the world’s civilian drones.  

Endnotes

This fact sheet was prepared by Professor James Laurenceson, Deputy Director, Australia-China Relations Institute, University of Technology Sydney. 

[1] GDP in RMB is from CEIC database. This is converted to $US using a period average exchange rate of 6.1625. http://en.xinfinance.com/html/Economies/Regional/2015/59099.shtml

[2] http://www.bloomberg.com/news/articles/2015-05-11/the-little-village-that-could-shenzhen-set-to-surpass-hong-kong

[3] http://data.worldbank.org/about/country-and-lending-groups

[4] http://data.worldbank.org/indicator/NY.GDP.PCAP.CD

[5] http://data.worldbank.org/indicator/NY.GDP.PCAP.CD

[6] CEIC database

[7] http://www.scmp.com/news/hong-kong/economy/article/1797971/shenzhen-knocks-down-hong-kong-take-top-spot-chinas-ranking?page=all

[8] www.inc.com/magazine/201503/greg-lindsay/pushing-the-boundaries-global-cities-photo-essay.html

[9] http://europe.chinadaily.com.cn/business/201508/31/content_21755380.htm

[10] http://www.censtatd.gov.hk/hkstat/sub/sp120.jsp?tableID=207&ID=0&productType=8

[11] http://www.chinadaily.com.cn/regional/2015-07/25/content_21466054.htm

[12] http://www.scmp.com/lifestyle/technology/enterprises/article/1765430/top-5-tech-giants-who-shape-shenzhen-chinas-silicon

Author

Professor James Laurenceson, Deputy Director, Australia-China Relations Institute, University of Technology Sydney