South China Morning Post Tech News Team
Overseas entrepreneurs, including those from Hong Kong, are taking a closer look at Shenzhen’s emerging eastern sub-districts, thanks in part to government backing for an ambitious plan to create a hub for startups and other young businesses.
The municipal government is planning to invest 1.4 trillion yuan in the next five years to foster a growing community dedicated to innovative new industry.
In May, Shenzhen unveiled its Eastward Shift Strategic Action Plan for 2016 to 2020, a development blueprint that lays out its vision and will bring new land supply to the outer rim area on city's eastern reaches.
Shenzhen’s eastern areas, which cover Longgang and Yantian sub-districts and two new districts of Pingshan and Dapeng, are currently home to sprawling residential estates. These areas lack proper infrastructure and transportation facilities, and have fallen behind city's developed western areas.
According to the five-year plan, large infrastructure projects, including three new international airports, 10 highways and 14 metro lines, will be a cornerstone of the program to develop the eastern areas by 2020.
International universities and high-tech industrial parks are also on the drawing boards. The Chinese University of Hong Kong will take part in the development of a campus in the district. The plan will also feature at least three industrial clusters focused on themes such as new energy and next generation information technology. Each cluster is forecast to produce industrial output of 100 billion yuan annually by 2020.
On the educational front, 40,000 university and college placements will be available, while 7,000 placements are targeted at the senior high school level. These education facilities will support a community forecast to attract 300,000 new residents by 2020.
Shenzhen’s business hub will become an important point of intersection where startups can meet with venture capitalists and other entrepreneurial talent, bringing important resources together in one community, eSight Technology founder Huang Bufu said.
eSight Technology is a startup in Shenzhen, founded by Hong Konger , Huang Bufu, 40 per cent of the company's employees from Hong Kong.
Huang Bufu completed his doctoral studies at the Chinese University of Hong Kong and opted to make Shenzhen the headquarters for eSight Technology, a company focused on machine vision development for industrial automation.
“Based in Shenzhen, startups of our kind can reach various venture funds across the country and benefit from preferential policies from local government, not only for the projects and startups, but also for the human resources,” Huang said. Huang said his company had already completed its first round of financing, attracting investment from several mainland Chinese venture capital funds.
“Our 20-people startup is applying for such preferential policies. If approved, we will get a few million yuan in subsidies from Shenzhen authorities.” Huang said.
“We would definitely look to eastern areas of Shenzhen for our expansion as property costs have skyrocketed downtown. If the Eastward Shift Strategy could bring about transport convenience and attract skilled people in the short term, it’s good news for startups’ expansion.”
Shenzhen remains China’s most expensive city in terms of housing prices. In August, average home prices reached 54,478 yuan per square metre, climbing 2 per cent from July. Shenzhen, also known as China’s Silicon Valley, has seen new home prices surge 43 per cent so far this year.
Home prices in Longgang district have reached over 40,000 yuan per square metre, propelled higher in the four months since the announcement of Eastward Shift Strategic Action Plan as demand grew in view of the future development of the district.
In the first six month of this year, Shenzhen's GDP growed 13.8 per cent year on year to reach 143.62 billion yuan in Longgang district, ranking first among Shenzhen's districts.
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