Development of Innovation & Technology in the Greater Bay Area Hinges on "Joint Forces"

HONG KONG, CHINA-  Media OutReach - 15 October 2018 - Cushman & Wakefield, a global leaderin commercial real estate services, recently released the fourth report in theResearch Series of Greater Bay Area (GBA) -- "Innovation and TechnologyDrive Development: Research on Innovation and Technology Industry and PropertyOpportunities in the Greater Bay Area". The report focuses on Hong Kong,Shenzhen, Guangzhou and Dongguan and analyses the development status and mainadvantages and disadvantages of the innovation and technology industry andproperty opportunities in each of these four cities. It also offers an outlookon the coordination and cooperation of different cities as the GBA furtherdevelops.

Hong Kong, Shenzhen, Guangzhou andDongguan and their respective edge

Thereport said that innovation and technology industries of Hong Kong, Shenzhen,Guangzhou and Dongguan have begun to establish their respective competitiveadvantages:

Hong Kong: The meeting point forglobal innovation elements.As one of the top three global financial centres, Hong Kong is the meetingpoint for global innovation elements, high-end talents and corporateinstitutions. At the same time, thanks to its international business model andservice system, it is undoubtedly the most important gateway city for high-techenterprises from the GBA to connect with the international market. Hong Kong'sfinancial infrastructures are highly developed. Many fintech companies have setup office in the city which in turn helps bring global capital to theinnovation and technology industry of the Greater Bay Area. Hong Kong has a goodnumber of internationally top-ranking universities and high-end scientificresearch institutions, with outstanding research talents and extensiveexperience in technological research and development, intellectual property andrelated fields. This helps drive innovation in Hong Kong and throughout the GBA.

Shenzhen: The dynamic frontier ofinnovation and technology.In 2010, high-tech industry was established as one of the four pillarindustries in Shenzhen. The industry has outstanding achievements after yearsof development. The added value of the industry accounts for over 30% of GDPfor years. It is undoubtedly the first growth point and the first pillarindustry in Shenzhen's economy. In the long process of developing high-techindustry, Shenzhen has formed a system based on R&D enterprises,market-oriented and supported by academic research that facilities the creationand application of innovative technologies. As a frontier of reform, Shenzhenhas produced a number of outstanding world-class and national top 500enterprises in just over 30 years of development. These industry giants havenot only played a huge leading and driving role in industrial development, butalso have helped attract upstream and downstream enterprises in the industry tocultivate an incubation platform and market environment. Vibrant enterprisesare the foundation for industrial development. Whether it is the number ofleading innovation and technology enterprises currently based in Shenzhen, orthe development trend of the emerging unicorn enterprises, we have every reasonto expect that Shenzhen will become the leader of innovation and technology in GBA.

Guangzhou: The internal drive and hubof innovation in the GBA.As an important industrial base in the country, Guangzhou has 35 of the 41 mainindustrial sectors in China. Its manufacturing and service industries are themost developed and most comprehensive among cities in southern China. At theend of 2017, the production value of the three pillar industries of automobilemanufacturing, electronic product manufacturing and petrochemical manufacturingindustry successively broke through the RMB100 billion levels, which drove therapid development of Guangzhou's overall economy. At the same time, Guangzhouactively cultivates strategic emerging industries. The manufacturingindustries, which is represented by automobile, electronic products andpetrochemicals, were transformed and upgraded by the wave of technologicalinnovation, which helped accelerate the development of emerging industries suchas IAB (Information technology, artificial intelligence, biomedicine) and NEM(New/Renewable energy & materials). Together, they help advance Guangzhouto the league of international innovation hubs. Meanwhile, its total number ofcolleges and universities ranks third in China which is a continuous supply oftalents. High-quality scientific research institutions also form an importantpart of the "Innovative Brain" of Guangzhou and facilitate thedevelopment of innovation and technology in the GBA.

Dongguan: From "Made inChina" to "Created in China". In 2017, the total GDP of DongguanCity surpassed RMB758.2 billion, an increase of 8.1% over the previous year. Itwas above the average GDP of the Guangdong province and China, and rankedfourth in the province and 19th in the country. However, as economicdevelopment enters a new stage, upgrading of industrial structure has become amust for sustainable development. In particular, the development of high-techmanufacturing industries represented by smart manufacturing plays a core rolein the transformation of "Made in Dongguan" to "Created inDongguan". In the context of developing the GBA, the geographicaladvantage, strong industrial base, ample industrial and policy support haveattracted more and more enterprises to gather there. Dongguan is positioned tobe the advanced manufacturing center of the GBA, the application ground for theIT and R&D achievements in the region and features heavily on thedevelopment chain of the innovation and technology industry.

Weakening boundaries between citiesfacilities efficient flow of production factors

Authorof the report, Xiaoduan Zhang, Directorand Head of Research, South & West China of Cushman & Wakefieldsaid, "In the process of integration of the GBA, thanks to theestablishment of '1-hour traffic circle' and the overall planning of the GBAcoordinating agencies, the flow of various factors of production will be freerand more efficient. The degree of industry concentration, talent availability,transportation convenience, preferential incentive policies, occupancy costs,supporting incubation facilities etc. are all important factors that affect thelayout of enterprises. Different cities and even different districts with theirunique characteristics in the GBA will gradually establish their owncompetitive advantages and attract the most suitable industries and enterprisesunder market forces, which ultimately will lead to reasonable layout ofdifferent segments of different industries or industrial chains in the GBA andensure its healthy, sustainable and efficient development."

(Note: Industrial parks from top:Nanshan Hi-tech Park, Hong Kong Science Park, Tianhe Intelligence City,Guangzhou Science City, Dongguan Songshan Lake)

Cities complementing each other willcreate "bigger force"

Jiang Binghe, Senior Director,General Manager of Business Marketing, The Greater Bay Area Services and FreeTrade Port in Hainan of Cushman & Wakefield, said, "The various cities anddistricts in the GBA need to leverage their own advantages, while making fulluse of different resources for synergy and integration, so that the difficultiesand problems encountered by various industries in the cities can beresolved."

"Theintegration of the GBA depends on building a more efficient and inter-connectedtransportation system, breaking barriers to the regional development policy system,and to change the existing development pattern through guidance andstimulation, which will ultimately promote a free and efficient flow ofimportant production factors in the GBA. This will not only support thedevelopment of the GBA but will also bring more opportunities for thedevelopment of various sectors and various fields of real estate."

Hong Kong is a springboard for GBAresearch achievements to reach the world stage

John Siu, Managing Director, HongKong of Cushman & Wakefield,said, "As a melting pot for talents with free flow of information, HongKong has attracted the attention of more and more fintech companies. Anincreasing number of them have chosen to set up office in Hong Kong, some evenin core business areas in order to increase market share and to raise theircorporate profiles. This will create a bigger mass of the fintech industry inthe city. In addition, government-funded projects such as the Science Park andthe Lok Ma Chau Loop will attract start-ups and local enterprises to enter theGBA and expand the scale of the industrial market. These are importantconditions for nurturing Hong Kong into an international center of innovationand technology. Hong Kong, as the "Super-connector" in the GBA, willbe able to bring important research achievements in the Bay Area to theinternational arena."

Please click here todownload the full report (Chinese version only).

About Cushman & Wakefield

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