China’s High-tech Parks: Beijing’s New “Go West” Strategy?

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China has recently opened a remarkable number of industrial development zones such as high-tech parks. These parks represent tools Chinese policymakers use in their attempt to encourage hubs of high-tech development, innovation and entrepreneurship. The Chinese government seeks greater high-tech development to accelerate the economy’s transition from a resource and capital-intensive economic model to a more advanced, service-oriented model. These zones represent the government’s attempt to reach its goals of both directing more foreign direct investment (FDI) and foreign technology to China.
 
These parks also present one prong of Beijing’s “Go West” campaign, in which the government aims to develop China’s inland provinces. Today, there are roughly the same number of industrial development zones, the larger category into which the high-tech parks fit in, in coastal provinces as there are across both China’s central and western provinces.
 
Chengdu, for example, aims to position one of its neighbourhoods as a tech hub that rivals Beijing’s Zhongguancun, China’s so-called Silicon Valley. With international firms such as Dell, Siemens and Philips basing their Western Chinese operations there, the Chengdu Hi-Tech Zone in the south-western city recently announced that the number of enterprises registered in the zone increased by nearly 50% to over 1,600 in Q1 2014.
 
However, recent studies have suggested that the zones themselves have provided limited impact on their two primary goals—increasing both the level of FDI and rate at which foreign technology is acquired—and that any perceived achievement of these goals would have occurred regardless of the park’s establishment. More than one study has suggested that without development zones, these enterprises would still be in the same region, just not as concentrated.

While it is unclear whether these parks will successfully achieve their goal of bringing greater FDI and advanced foreign technology to China, the scale and speed of their growth is remarkable and their presence will continue to make a strong impact of the development of China’s economy, especially inland China, for the foreseeable future.

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