Biotech/life science, big data, 5G and artificial intelligence among key areas of innovation
Four major cities in China, namely Shanghai, Beijing, Hong Kong SAR and Shenzhen, are ranked among the Top 20 leading technology innovation hubs outside Silicon Valley/San Francisco over the next four years, according to KPMG’s annual survey of global technology leaders.
The 2020 KPMG Technology Industry Innovation Survey, in its eighth year, includes responses from more than 800 global leaders in the technology industry from 12 countries, with 110 respondents from China. It shows that Shanghai and Beijing remain in the list of Top 10 leading technology innovation hubs. Hong Kong SAR’s ranking rises from #12 to #10, and Shenzhen, which was not on the 2019 list, is ranked #17 this year. Singapore’s ranking moves up from #7 to first place, while New York, last year’s number one, dropped to #5 on the ranking list this year.
On a national level, China is ranked second by 13% of surveyed respondents (a drop from 17% in 2019), in a tie with India, on the list of countries showing the most promise for developing global impactful disruptive technologies, following the U.S. at 28% (an increase from 23% in 2019). The survey respondents believe that China must now spend more time and resources to develop its own domestic innovation ecosystem due to the current US stance on technology and IP, in relation to China.
China’s cities appear to be rising to the challenge. The report reveals that major cities in China are developing differentiations in various areas of technological innovation, as China continues to make its drive towards deep tech innovation a national priority.
Beijing, for example, is fast becoming a leader in the software and platform business and continues to build and strengthen its capabilities with regards to 5G, quantum computing, life science, optical-magnetic, big data and artificial intelligence.
Shanghai meanwhile, is leading in the area of biotech and is continuing to build and strengthen in semiconductors, artificial intelligence and next generation information technology, including aviation, big data and blockchain.
Shenzhen leads in hardware, embedded systems and 5G, while continuing to build and strengthen its capabilities in new materials, semiconductors, renewable energy, biotech, artificial intelligence and advanced manufacturing. Many deep tech companies are home grown in the city.
Philip Ng, Partner, Head of Technology, KPMG China, said, “Beijing has established a mature technology and innovation ecosystem and has a large number of multinational and domestic research institutes, while Shanghai has benefited from its well-established financial services centre, well-connected logistics network and ecosystem of multinational companies. Both cities are supported by a continuous supply of talent from well-established universities. Shenzhen, a thriving technology hub, also has a mature market environment to nurture and support the growth of deep tech companies in the city.”
In Hong Kong, artificial intelligence, biotech, fintech and smart cities are key areas of development. Increased economic connectivity within the city itself forms an important part of smart city development, particularly in terms of start-ups, established companies and the government working together.
Irene Chu, Partner, Head of New Economy & Life Sciences, Hong Kong, KPMG China, said, “The Hong Kong government is supporting and promoting an entrepreneur ecosystem, as well as leveraging the city’s mature international financial system and advanced logistics sector to drive a real difference. Going forward, co-creation and cooperation between public and private sector will play an important role in smart city development in Hong Kong.”
Currently, Hong Kong has planned for heavy investment in the Lok Ma Chau loop to serve as the hub for joint technology and innovation development with Shenzhen. There is further potential for start-ups in Hong Kong to utilise the rest of the Greater Bay Area, and beyond, through cross-border collaborations.
Anson Bailey, Partner, Head of Technology, Hong Kong, KPMG China, said, “Hong Kong’s status as a start-up hub attracts entrepreneurs from across the world, and the city is clearly an important R&D centre for start-ups. With Hong Kong economically connected with substantial markets in close proximity, there is potential for start-ups to utilise the rest of the Greater Bay Area for R&D and leverage the ASEAN countries as investment destinations as well.”
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