In 2016, Professor Wei Dazhi of Shenzhen University and Qin Shuo, a well-known media person, had a furious debate and compare over the economy trend of Shanghai and Shenzhen. Their viewpoints and conclusions are so different.
Song Shiqiang, from Kinghelm(www.kinghelm.net) and Slkor (www.slkoric.com), one of the top 50 punster writers in Huaqiangbei, Shenzhen, choose to support Professor Wei. To start with, I will analyze what Shenzhen is ahead of Beijing and Shanghai from the perspective of a Huaqiangbei economist.My conclusion is that Shenzhen will be the top city with the best economic development in China in the foreseeable future.
Song Shiqiang, General Manager of Kinghelm and Slkor
- Efficiency.
"Time is money and efficiency is life" was first raised by Shekou Industrial Zone in Shenzhen. "Shenzhen Speed" is the core spirit of the city and the key competitiveness of Shenzhen.
- Efficiency of land utilization.
Shenzhen covers an area of 1,997 square kilometers. In 2016, its GDP was 1.94 trillion yuan, and the area-effectiveness index was 978 million per square kilometer. Beijing covers an area of about 16,808 square kilometers, with GDP of 2.49 trillion yuan and the area-effectiveness was 148 million per square kilometer. Shanghai covers an area of about 6340.5 square kilometers, with GDP of 2.74 trillion yuan and the area-effectiveness was 430 million yuan per square kilometer. Thus, Shenzhen's land efficiency is on the top in China.
- Labor efficiency.
"Wealth is the accumulation of disciplined working ". Shenzhen people are well known for their fast pace and high efficiency. First, Shenzhen is a place with the largest proportion of small and medium-sized private enterprises. Second, Shenzhen does not have a legacy of unsuitable rules and regulations, and there is almost no bureaucratism. Also, Shenzhen has no financial burden left over from its history. These will definitely help the city’s development.
- Capital efficiency.
The proportion of central and large state-owned enterprises in Beijing and Shanghai is very big, and their accounts have stagnant funds with low utilization and turnover rates, and these prove the theory of “the tragedy of the commons” promoted by a famous Chinese economist Xu XiaoNian . In 2015, the outstanding of deposits of financial institutions in Beijing reached 12.86 trillion yuan, Shanghai reached 10.38 trillion yuan and Shenzhen reached 5.78 trillion yuan.
- Economic quality.
In 2014, the GDP growth rate of Beijing was 7.3%, 7% for Shanghai and 8.8% for Shenzhen. In 2015, it was 6.9% in Beijing, 6.9% for Shanghai and 8.9% for Shenzhen. In 2016, it was 6.7% in Beijing, 6.8% for Shanghai and 9.0% for Shenzhen. Considering the current GDP scale and growth trend (see the chart below), it won’t be long before Shenzhen overtakes Beijing and Shanghai.
The GDP growth rate of Beijing, Shenzhen and Shanghai
Shenzhen's per capita GDP also ranked first in China, reaching 167,000 yuan (equal as 25,200 U.S.D.) in 2016, continuing to rank first among mainland cities which are at or above the sub-provincial level. In 2016, Shenzhen's total export volume reached 1,568.04 billion yuan, ranking first among mainland cities for 24 consecutive years. Huaqiangbei Shenzhen is China's largest electronic components distribution center, and it has been awarded the title of "The First Electronics Street in China" by China Electronics Chamber of Commerce.
- City innovation.
Shenzhen has an innovative and encourage environment. There are a large number of small and medium-sized private enterprises in Shenzhen. They are the most innovative entities. Their micro innovations accumulated over time, and greatly drive the development of the city. Shenzhen is a city of migrants, and the continuous increasing migrants also bring the competition, innovation and development. Take the year of 2016 as an example, the quantity and quality of intellectual property output of Shenzhen ranked first in China. According to Forbes' list, Shenzhen ranked first among the 25 most innovative cities in Chinese mainland in 2015. Its comments say that Shenzhen is a representative of spontaneous innovation, the open economy makes innovation become the endogenous power of enterprises.
- System.
In terms of system, Shenzhen is the first city in China to enjoy the policy dividend and the pilot of political reform. With independent legislative power, Shenzhen has been stumbling out of the fetters of planned economy. Apart from the domestic population dividend and market dividend, there are a continuous supply of well-trained and inexpensive labor force from the Chinese mainland as well as a vast market, so the comparative advantage of Shenzhen is particularly prominent.
Some ceramic antenna products of Kinghelm（www.kinghelm.net）
- Finance
There are more than 350 listed companies in Shenzhen, about 220 of them are listed domestically and 130 are listed in Hong Kong, the United States and elsewhere. These provide the functions of so called blood transfusion and hematopoiesis for the listed companies in Shenzhen, and prove that the governing level of Shenzhen companies is world-class. Shenzhen is adjacent to Hong Kong, and it's a geographical advantage to construct"Guangdong-Hong Kong-Macao Greater Bay Area". Hong Kong is the world's most dynamic financial centre, Shenzhen has Ping An, China's largest financial group with best performance in China, as well as China Merchants Bank, the most normative domestic bank in management. Together with Hongkong, Shenzhen can quickly develops into a big international financial center competing with London and New York. These will not only strengthen China's international competitiveness, but also introduce more worldwide financial resources for Shenzhen.
- Other factors.
- Population dividend
Based on the characteristics of Shenzhen, three points of population dividend are analyzed here. The first is the employment proportion of residents. The employment rate of women in Shenzhen is close to 90% (the employment rate of the whole China is 76%, also it’s the highest in the world). Second, the dependence of employees on work. Most people who come to Shenzhen have nothing to rely on except themselves, so their working initiative and efficiency are very high. The third is people who come to Shenzhen have a restless heart, which not only brings Shenzhen infinite imagination space and possibilities, but also becomes the Shenzhen spirit to fight and dare to break through.
- Urban vitality
Shenzhen is the most dynamic city in China. The dual structure of Beijing is basically fixed, people there are too lazy to move and scare to break through. Shanghai's management is too precise, which may damage the efficiency and stifle the creativity. Shenzhen is full of vigor and vitality, with the ambition of embracing the whole world, and put forward the slogan "You are the Shenzhen person once you come here".
Shenzhen's innovation brings vitality, and so does its incentive system.With a high degree of privatization, the boss is easy to make decisions and flexible in the allocation, which is beneficial to stimulate the enthusiasm of employees.
- Benchmarking demonstration enterprises
Shenzhen's leading enterprises are of great value to social development. Vanke first put forward the concepts of "housing industrialization" and "urban operation", which enabled the real estate industry to find a model and project for rapid development. Huawei is benchmarked against world-class enterprises, and its products are sold all over the world, enabling Chinese enterprises and Chinese people to show themselves on a bigger stage. China Merchants Bank has brought high quality service and long-term layout awareness to Shenzhen.
- Weakness.
Shenzhen lacks education and medical resources, especially high-quality high-end resources. Shenzhen also lacks long-term strategic visions and topologies, especially some farmer-entrepreneurs. In addition, Shenzhen people also lack feelings and cultural accumulations, and Shenzhen may suffer losses in the future cultural soft power competition. To achieve the great Shenzhen dream, Shenzhen should overcame its weakness in both hard and soft power.
Brief Introduction of Song Shiqiang.
Apart from CEO of Shenzhen SlkorMicro and Kinghelm, Mr. Song Shiqiang is currently holds a few important social positions: Private economic researcher of the Economic Development Center of the China State Council, member of the electronic information expert database of China Association for Science and Technology, commercial research expert of Huaqiangbei Alliance.
https://www.slkoric.com/song-shiqiang/772776.html