Shenzhen is set to become a popular destination for Hong Kong youths under new guidelines

By Shen Weiduo and Li Xuanmin in Shenzhen Source:Global Times Published: 2019/8/29 12:53:03

Shenzhen, a rising tech hub in South China, is set to attract more young entrepreneurs from the Hong Kong Special Administrative Region (SAR) under a new document released by China's central government that aims to build the city into a pilot demonstration area of socialism with Chinese characteristics, Hong Kong entrepreneurs who have started businesses in the city told the Global Times.

Technological cooperation between the two neighboring cities will also alleviate social problems Hong Kong amid the ongoing protests, which have caused social unrest and continue to bring economic chaos to the world financial center, the entrepreneurs said.

They noted that the city's flexible and favorable policy, a mature technology industrial chain, and an inclusive and innovative environment, will offer Hongkongers more long-term development opportunities.

Under Beijing's guidelines released on August 18, Shenzhen is aiming to become one of the best in the world in terms of economic strength and development quality by 2035.

Hong Kong and Macao residents who work in Shenzhen would be given "citizen treatment" to enjoy local social welfare benefits.

"Shenzhen's new strategic positioning will help promote the overall development of the Greater Bay Area and create a better entrepreneurial environment. A more open environment and convenient policies also opened a door for Hong Kong young entrepreneurs to work in the mainland," Kris Tsang, founder of the 708090 co-working space, told the Global Times.

Tsang's company mainly serves young people from both Shenzhen and Hong Kong to start businesses Shenzhen.

The Greater Bay Area, encompassing Hong Kong, Macao and nine mainland cities including Shenzhen, is another Chinese government scheme to turn the region into an innovation and financial powerhouse rivalling Silicon Valley and the Tokyo Bay Area.

Hong Kong entrepreneurs also said that Shenzhen, which is now home to a number of technology giants including Tencent and Huawei, also has a number of incubators that provide a well-rounded service for entrepreneurs, comparable with only a few incubators in Hong Kong.

 "When I worked in Shenzhen's incubator, the air conditioners worked 24 hours a day, but Hong Kong's incubators shut down the air conditioners at 7 pm. How could I continue R&D at a temperature that is above 30 centigrade? Should I go back home with my colleagues to do research in my 27-square-meter apartment?" asked Henry Yau, a Hong Kong resident who founded the Shenzhen intelligent lighting company Everbright Technology Development in Qianhai Dream Factory in 2016.

Yau said that the reason he expanded his business from Hong Kong to Shenzhen was the latter's reputation as a world electronic manufacturing base.

 "Shenzhen is like a seafood night market, which enables you to access whatever electronic parts you want. It also has a cluster of restaurants for sea food cooking in the neighborhood, just like the numerous local electronic processing facilities here. Anyone in the electronics industry will be attracted to the city," Yau told the Global Times on Thursday. 

Such proximity has sped up the production cycle, which Yau said could be 3.5 to 4 times faster than US' Silicon Valley - the world's innovation center for the high-tech industry.  

In a personal record, it only took Yau's company five days to complete the production cycle of an intelligent lighting product in Shenzhen, including raw material assembly, testing, placement on the market and applying for a patent.

With such convenience and efficiency, the economy of the southern city, which borders Hong Kong in the south, has skyrocketed in recent years and surpassed Hong Kong for the first time in 2018 with a GDP of 2.42 trillion yuan ($361.24 billion).

Now, Yau's Hong Kong office specializes in research and development, while the Shenzhen branch focuses on translating research findings into market applications and product promotion. 

Such a division mirrors the comparative advantage of the two metropolises, where Hong Kong excels in innovation and Shenzhen has its strength in market application and exploration, industry insiders said.

"We have set up a sales department, hoping to make Shenzhen a beachhead to make a foray into the massive Chinese-mainland market. We also hope to get a ride on the Belt and Road Initiative to expand our business abroad," Yau said.

A boost for Hong Kong 

A prosperous and attractive Shenzhen will also alleviate the current social problems faced by Hong Kong, Tsang said.

Hong Kong is known for its small but expensive living space - one that is even higher than New York or London.

The development of Shenzhen can offer Hong Kong's people more choices and a broader scope beyond the city, which can alleviate the employment pressure in Hong Kong. Shenzhen's increasingly open policy, and "citizen treatment" for Hongkongers, will also address their concerns of settling down in the mainland city, according to Tsang.

Nevertheless, despite its rapid development and status as a paradise for start-ups, Shenzhen still has a lot to do in terms of attracting international talent, including those from Hong Kong.

"The maximum personal income tax in Hong Kong is 16 percent, while in the Chinese mainland it is 30 percent, which means that Hongkongers may earn less in Shenzhen even if their pre-tax incomes are higher," Yau said.

He also noted that, as more foreigners will live in the city with their families in the future, Shenzhen should open more affordable educational institutions for foreign children.

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