The regional environment
Economic base
In 2021 Shenzhen became the third city in China, after Shanghai in 2017 and Beijing in 2018, to pass three trillion RMB in regional GDP.
In the 2021 China Urban High-Quality Development Ranking, Shenzhen placed first nationally, ahead of Shanghai, Guangzhou, Beijing and Hangzhou; the rest of the top ten were Nanjing, Suzhou, Chengdu, Wuhan and Changsha. The ranking is not built on GDP alone — it scores innovation, green development, demographic potential, economic growth and improvement in living standards — and Shenzhen ranks first nationally on two of those five: innovation and demographic potential. Those two are the drivers underneath a city’s economic momentum.
Shenzhen’s stated goal is to become, by 2035, a globally influential centre of innovation, entrepreneurship and creativity and a model city for China’s modernisation. The advantages it is working from:
- Demographics. Net population inflow is the highest in the country, and the average age is under 34 — the youngest major city in China.
- Technology. In 2020 Shenzhen filed 20,200 PCT international patent applications, a third of the national total. Research spending is projected to exceed 200 billion RMB by 2025.
- Industry. Shenzhen is one of China’s four major technology centres, with more than 17,000 national high-tech enterprises, second only to Beijing.
The city is also building universities and hospitals at scale. As its science, education, culture and health capacity catches up, its overall strength rises with it. By mid-century the ambition is a special economic zone that represents a modernised China, a globally competitive innovation-led city, and a stronger maritime centre.
Policy environment
In July 2021 Shenzhen published China’s first local regulation in the field: the Shenzhen Special Economic Zone AI Industry Promotion Regulations, in draft. It works through six areas — defining what AI and the AI industry cover, establishing statistics and monitoring, closing the gap in basic research, building industry infrastructure, using application scenarios as the driver, and setting out governance mechanisms — under a frame of clarifying scope, filling gaps, strengthening support, seizing applications, clustering development and regulating conduct.
The aim is to legislate the industry into healthy growth and to deepen its integration with other sectors, which the city presents as the route to a globally leading AI industry base.
Competitiveness
In the Greater Bay Area AI Development Report published by CAICT, Shenzhen ranks 78th among the world’s most innovative AI cities, with an applied-research innovation index of 63 and a basic-research index of 60.
The innovation culture is dense. Huawei, Tencent and UBTECH are based here, and the manufacturing and service base is deep enough to give AI something to attach to.
Demand and scale
Building on its electronics industry and pushing at core technologies, Shenzhen has assembled a set of AI clusters: Shenzhen Bay Technology Park, Gemdale Viseen Software Park, Nanshan Smart Park, Baoneng Technology Park and Longgang Tianan Cloud Valley among them.
Scale, nationally leading
The foundation is manufacturing, and the character is hardware. In 2020 the city’s AI industry passed 150 billion RMB, up 16.7% year on year, with AI-plus applications in intelligent hardware, computer vision, autonomous driving, smart finance and smart healthcare leading the country.
Company count, second nationally
By the end of 2020 Shenzhen had 1,318 AI-related companies, up 25.2% — second nationally after Beijing, and 17% of the national total.
Spatially, Nanshan holds the largest cluster; Tencent, DJI and SF Technology are all based there. Futian concentrates smart healthcare and technology finance, including Ping An Technology. Huawei and HiSilicon sit in Longgang.
A complete supply chain
Shenzhen now has the full chain across three layers — foundation, technology and application — forming a tiered company ecosystem. On the 2020 figures, 22.89% of the city’s AI companies sit in the foundation layer, 20.57% in the technology layer and 56.54% in the application layer, the last concentrated in public security, smart manufacturing, smart transport and smart home.
Key application areas
The industry has taken shape, the scenarios are varied, and consumer devices are in strong supply. On the application side, AI is breaking through in entertainment, the home, security, healthcare and autonomous driving. On the hardware and software side, Shenzhen has an edge in computer vision and a solid base in algorithms, chips and sensors, with strong companies emerging in drones, service robots, smart healthcare and autonomous driving.
The next five years
Under the city’s New Generation AI Development Action Plan for 2019 to 2023, the target for 2023 is an internationally first-rate pilot zone for AI applications: more than 20 innovation platforms, more than 20 leading enterprises with domestically leading technology, and 10 key industry clusters. The core AI industry is to pass 30 billion RMB, pulling related industry to 600 billion.
Republished for information. The original text has not been independently verified and does not necessarily reflect our views.
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