From fac­tory floor to in­no­va­tion hub, Shen­zhen’s ex­po­nen­tial growth con­tin­ues

Business Traveller - - CONTENTS - WORDS TAMSIN COCKS

The rise of Shen­zhen in China

Amid the soar­ing glass tow­ers and mod­ern build­ings of Shen­zhen’s Futian CBD is a rare pocket of idio­syn­cratic low-rise build­ings. The ram­shackle struc­tures of Gangxia vil­lage are known as “hand­shake build­ings” af­ter their densely packed for­ma­tion, mean­ing neigh­bours could lit­er­ally shake hands through fac­ing win­dows.

Crammed full of tiny apart­ments, in­de­pen­dent shops, food stalls and more, the “ur­ban vil­lage” is bustling with life and at­mos­phere, pro­vid­ing af­ford­able ac­com­mo­da­tion for the mas­sive in­flux of mi­grants and low­in­come work­ers, a melt­ing pot of street food cui­sine from Hu­nan and Sichuan and shops cater­ing to ev­ery possible need and want.

This charis­matic set­tle­ment is one of the last of its kind, a symp­tom of the rapid changes that have seen Shen­zhen turn from a col­lec­tion of fish­ing vil­lages with some 30,000 in­hab­i­tants into a me­trop­o­lis of ten mil­lion peo­ple in less than 40 years.

How­ever, Gangxia’s days are num­bered. Oc­cu­py­ing prime space in the heart of Shen­zhen, it won’t be long be­fore the city ab­sorbs this ur­ban vil­lage as it has many oth­ers. Hap­pily for the own­ers of these di­lap­i­dated con­struc­tions, the pay­off will be enough to set them up for life, with prop­erty prices in Shen­zhen soar­ing to un­heard-of fig­ures.

“We call them bil­lion­aire vil­lages,” jokes Grace Huang, mar­ket­ing com­mu­ni­ca­tions man­ager for Hil­ton Futian. “Prop­erty prices here used to be 10,000 yuan (£1,164) per square me­tre, but now they’re 100,000 yuan (£11,640). This is the only vil­lage left and ac­cord­ing to gov­ern­ment plans, it will be re­moved by 2019 or 2020, at the lat­est.”

While the rapid emer­gence of huge cities in China is not un­com­mon, Shen­zhen is a spe­cial case for a num­ber of well-doc­u­mented rea­sons. In 1979, it was es­tab­lished as the first Spe­cial Eco­nomic Zone in China as part of Deng Xiaop­ing’s ex­per­i­men­ta­tion for re­form and de­vel­op­ment. The ex­per­i­ment has been a re­sound­ing suc­cess. Open­ing up to for­eign in­vest­ment, com­bined with prox­im­ity to Hong Kong, turned Shen­zhen into a man­u­fac­tur­ing hub. Enor­mous for­eign-run fac­to­ries from Fox­conn to Ap­ple moved in, and Shen­zhen be­came an elec­tron­ics hub,

churn­ing out up to 90 per cent of the world’s gadgets and putting the former fish­ing vil­lage on the map.

The on­go­ing changes in Shen­zhen are so rapid that vis­i­tors re­turn­ing ev­ery few years are shocked at the rate of trans­for­ma­tion. Luohu (Lo Wu) was the first es­tab­lished district and most im­por­tant part of Shen­zhen. To­day it’s famed for its shop­ping and nightlife, as well as serv­ing as an im­por­tant bor­der cross­ing into Hong Kong. About five years ago, the com­mer­cial fo­cus shifted to Futian, the cur­rent CBD that hosts the ma­jor­ity of fi­nan­cial in­sti­tu­tions (in­clud­ing the tow­er­ing Ping An Fi­nance Cen­tre) and more re­cently lo­cal gov­ern­ment of­fices.

Vir­tu­ally ev­ery in­ter­na­tional lux­ury ho­tel brand has claimed a piece of the pie: Shangri-La, Four Sea­sons, Ritz-Carl­ton, Marco Polo, Sheraton, Hil­ton, Lang­ham – and there’s still more to come, with re­cent sign­ings for a Mar­riott and Park Hy­att in Luohu and a Mandarin Oriental due to open in 2018. “There’s still a lot of de­mand,” ex­plains the Hil­ton’s Huang. “We’re see­ing more cor­po­rate trav­ellers than ever. We used to have more leisure trav­ellers, but now we’re 95 per cent busi­ness.”


Growth has al­ready spread be­yond the bound­aries of the “new” Futian CBD, mov­ing far­ther west into Nan­shan. While many cities clam­ber for the prestige of be­ing called “Asia’s Sil­i­con Val­ley”, the ti­tle is most fre­quently used in re­la­tion to Shen­zhen. The “fac­tory f loor of the world” has proven a fer­tile breed­ing ground for tech­no­log­i­cal in­no­va­tion. Af­ter all, there are few bet­ter places to find parts, sup­plies or man­u­fac­tur­ers, with fa­mous elec­tronic malls such as the SEG Elec­tron­ics Mar­ket in Futian, whose eight floors of­fer just about any­thing you could imag­ine, from cir­cuit boards to LED lights. There’s also the Huaqiang North Com­mer­cial Street elec­tron­ics mar­ket, the largest of its kind, with around 20 dif­fer­ent shop­ping malls ded­i­cated to parts.

This en­vi­ron­ment has given birth to a num­ber of tech gi­ants in­clud­ing Ten­cent, Huawei and ZTE. Other ma­jor tech play­ers have also re­lo­cated and set up shop in the city, in­clud­ing Alibaba and Baidu, along with droves of start-up en­trepreneurs eager to jump on the wave. Ac­cord­ing to a Fi­nan­cial Times re­port, Shen­zhen is home to more than 180 start-up in­cu­ba­tors and has ex­ploded in terms of on­line ser­vices and new IoT (In­ter­net of Things) ap­pli­ca­tions. One of the most suc­cess­ful start-ups

New neigh­bour­hoods such as Shekou are pop­u­lated by grow­ing num­bers of ex­pats and en­trepreneurs

...is drone man­u­fac­turer DJI, one of China’s top ten “uni­corns” – so called for re­ceiv­ing a bil­lion-dollar val­u­a­tion out of the start­ing blocks.

“Shanghai is a fi­nan­cial cen­tre. Beijing is pol­i­tics and fi­nance. And Shen­zhen is the tech­no­log­i­cal hub of China,” agrees 30-year res­i­dent Ray­mond Su, res­i­dent man­ager at Kempin­ski Ho­tel Shen­zhen. In ad­di­tion to its tech legacy, an­other rea­son Su be­lieves the city has flour­ished with re­spect to new tech­nol­ogy is its rel­a­tive youth. “Shen­zhen is a young city, not even 40 years old. So there’s no en­trenched mind­sets. Young peo­ple can set up a new sys­tem and fig­ure out how to do it ef­fi­ciently. The lo­cal gov­ern­ment is also more ef­fi­cient and there’s less red tape.”

The gov­ern­ment is work­ing hard to at­tract and re­tain young tal­ent, with a wide range of fi­nan­cial in­cen­tives from tax breaks to free rent schemes for re­turn­ing grad­u­ates. Life­style ben­e­fits within this tech fron­tier are also ev­i­dent – from the preva­lence of mo­bile pay­ments and app-cen­tric ser­vices, to cool new neigh­bour­hoods such as Shekou pop­u­lated by grow­ing num­bers of ex­pats and mod­ern en­trepreneurs.


Ma­jor tech­nol­ogy-fo­cussed events are also fre­quently held in the city, says Fiona Liao, direc­tor of com­mu­ni­ca­tions at Shangri-La Ho­tel Shen­zhen. From the In­tel De­vel­op­ment Fo­rum, which wel­comed more than 20,000 guests, to the “must-at­tend” Mars Sum­mit. Ap­ple, Ten­cent and Huawei all host ma­jor an­nual or bian­nual events as well.

In fact, the city has a thriv­ing con­fer­ence and events in­dus­try in its own right, re­veals Liao. “One of the rea­sons Shen­zhen is so pop­u­lar is that it’s very con­ve­nient for

trans­port. Shangri-La is the first choice for a con­fer­ence ho­tel in Shen­zhen – we have more than 8,000 sqm of con­fer­ence space and are near the Shen­zhen Con­ven­tion and Ex­hi­bi­tion Cen­tre. Re­cently we hosted the XIX In­ter­na­tional Botan­i­cal Congress, which saw more than 6,000 guests from 100 coun­tries.”

The MICE busi­ness is thriv­ing so much that a brand-new con­ven­tion cen­tre – touted to be the largest in the world – is cur­rently be­ing built in north of Shen­zhen In­ter­na­tional Air­port in Bao’an District. The Shen­zhen World Ex­hi­bi­tion & Con­ven­tion Cen­tre mega fa­cil­ity is sched­uled to be com­pleted by the end of 2018, with 500,000 sqm of ex­hi­bi­tion space com­pris­ing 19 ex­hi­bi­tion halls, plus meet­ing venues on ei­ther side.

But the Shen­zhen World de­vel­op­ment is just one part of a com­mer­cial and res­i­den­tial area planned for Bao’an, as Shen­zhen develops even fur­ther into its western dis­tricts. Ac­cord­ing to Mao Daben, ex­ec­u­tive deputy gen­eral man­ager for China Mer­chants Real Es­tate’s ex­hi­bi­tion op­er­a­tions cen­tre: “The venue is in talks with IHG, Mar­riott, Hy­att and Ac­cor to bring 4,000 ho­tel rooms in four- and five-star prop­er­ties to the area.”

The de­vel­op­ment will be served by two metro sta­tions, a new high­way and a fourth ter­mi­nal at the nearby air­port, as part of con­tin­u­ing up­grades to trans­port in­fra­struc­ture in or­der to keep up with de­mand. Com­muters have been en­joy­ing the added con­ve­nience pro­vided by the on­go­ing ex­pan­sion of Shen­zhen’s metro line, which now boasts eight lines with three more un­der con­struc­tion.

An­other ma­jor boost to the city will come next year, with the com­ple­tion of the new Guangzhou-Shen­zhen-Hong Kong High Speed Rail­way that will whisk com­muters from Futian to Hong Kong’s West Kowloon Sta­tion in just 15 min­utes.

With ef­fi­cient trans­port, cut­ting-edge tech­nol­ogy, con­fer­ence venues and mod­ern five-star ac­com­mo­da­tion, Shen­zhen has come on leaps and bounds in the past four decades – and there’s no sign of it slow­ing down any time soon.

Shen­zhen is a world away from the col­lec­tion of fish­ing vil­lages it used to be

TOP: The new high-speed rail­way from Guangzhou to Hong Kong via Shen­zhen ABOVE: Futian CBD

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