As US-led tech war heats up, connectivity is key to Beijing’s innovation ambitions

The capital city must improve its coordination with nearby Tianjin and Hebei, and look to the Greater Bay Area tech cluster for lessons
China must also establish outposts of innovation in friendly – or at least not so hostile – countries such as Singapore and South Korea

Winston Mok

Published: 3:00am, 14 Jun 2023

Why you can trust SCMP

As the US marshals its allies to starve China of access to leading-edge technologies as part of the tech war, China has been forced to upgrade its innovation capabilities. To that end, it plans to cultivate Beijing as a global tech hub through initiatives such as the Beijing International Science and Technology Innovation Centre. After all, Beijing’s Zhongguancun is seen as China’s answer to Silicon Valley, and the capital city has some of the country’s top universities.

In the latest Global Innovation Index, Beijing is ranked third, higher than Silicon Valley, which is ranked fifth. But the Greater Bay Area is still recognised as China’s top science and technology cluster, second only to the Tokyo-Yokohama corridor globally. With extensive manufacturing capacities, the Greater Bay Area has a more complete innovation ecosystem than Beijing.

Overall, the United States is ranked as the world’s second most innovative economy (after Switzerland), while China is just outside the top 10. Importantly, the top 10 consists of mostly Western countries – other than South Korea and Singapore. No matter how capable China becomes, it would be difficult to single-handedly compete against the West technologically.

The US is ahead in innovation, although China boasts of two tech hubs ranked higher than Silicon Valley – why?

Both countries have 21 tech clusters each in the top 100. Perhaps the American clusters deliver better results collectively. For example, the constituents of the two innovation belts on the US coasts – from Seattle to San Diego, and from Boston to Baltimore – may interact better with each other. China’s supercorridor of innovation hubs, centred in Shanghai-Suzhou, extending to Nanjing and Hangzhou on the two wings, may collaborate less effectively.

While Beijing itself may be a stronger tech hub than Shenzhen, the Greater Bay Area is matchless in China. The key to making Beijing a more effective innovation hub is not to elevate its pre-eminence, but to improve its coordination with Tianjin and Hebei, particularly in the promising Xiongan area. For China to advance its innovation performance, its role model should be the Greater Bay Area.

The preponderance of top universities in Beijing is a double-edged sword. There is perhaps no higher concentration of universities in the world than in Beijing’s Haidian district, where Zhongguancun is. But there is no more room to grow there.

The strategy for the Beijing International Science and Technology Innovation Centre is mainly based on satellite developments on the city’s fringes. These planned “towns” have their advantages but do not offer tight coupling with the social networks of the core innovation centre.

The economic rejuvenation in some parts of the highly urbanised Greater Bay Area has often been enabled by redevelopment. Beijing may draw similar lessons. As the capital city is vast, the temptation is to expand towards its fringe. However, more daunting urban renewal in Haidian may be more effective.

While several universities have expanded their campuses to Beijing’s outlying areas or Xiongan, a more effective approach in some cases would be a genuine relocation that frees up land for redevelopment.

00:54

China’s new megacity Xiongan takes shape near Beijing with residential area ready by summer 2023

For example, the Korea Advanced Institute of Science and Technology (KAIST), seen as South Korea’s MIT, is mainly located in Daejeon – which could be a role model for Xiongan – less than an hour from Seoul.

A key premise of the Beijing International Science and Technology Innovation Centre is drawing international talent. Some may welcome the neat environment of planned satellite towns. But many overseas may simply prefer the convenience and amenities of the city centre. A redevelopment of Haidian should not only encompass research parks but also housing, which is in chronic short supply.

The relocation of some universities away from Beijing, rather than a half-hearted expansion into satellite locations, would provide the needed impetus for the rise of Xiongan as a complementary tech centre in the Beijing-centred Tianjin-Xiongan innovation corridor.

Strict city planning could limit Xiongan’s growth before it begins

Innovation in Beijing and Tianjin are not better coupled, despite the short high-speed train connection, partly because the train terminal to Tianjin is in the wrong location – the Beijing South railway station is about 7.5km from central Beijing. If there were a direct high-speed train connection from Tianjin to near Haidian, such as the Qinghe or Beijing North railway stations, the innovation collaboration would be markedly different.

Likewise, greater coordination among the key innovation hubs in the Yangtze River Delta is important in maximising their effectiveness.

For all of Beijing’s talent concentration, it may still be less attractive to international talent than Hong Kong, and one reason is the Great Firewall. Thus, one important initiative for the Greater Bay Area would be to designate “free information zones” with no firewall.

01:27

Construction of Greater Bay Area Hongqimen bridge nears completion after gap closes

China must be realistic about competing on its own against the constellation of advanced Western economies. No matter how successful Beijing and Hong Kong may be in drawing international talent, such initiatives are far from enough.

China must establish outposts of innovation in friendly – or at least, not so hostile – countries, such as Singapore and South Korea. Some talent, including people of Chinese origin, may be willing to work for China but not on the mainland.

Although Chinese regions occupy two of the top three positions among the global science and technology clusters, the country faces an uphill battle against the “united front” of the West. Its best shot is to improve coordination among its key innovation hubs and set up more innovation centres overseas.

Winston Mok, a private investor, was previously a private equity investor

Post