The rise of Shenzhen

In 1970 the population of Shenzhen, a city in southeast China, was 22,000; in 2019 it was 12.128 millions, which stands for a 55,000% increase in barely 50 years. How has this village become one of the technological epicentres of the world in such a short time?

A fishermen village

If you’ve travelled to the north of Hong Kong in the 70’s, you would have found a humble fisherman village. What we now call Shenzhen was, at that time, a poor area with all its economy built around sea labour. In 1978 Deng Xiaoping was declared leader of the Republic of China, and its reformist policies were to radically change not only Shenzhen, but the whole country. It’s ultimate goal was to turn China into the biggest world power.

The next year Shenzhen was designated as the first ‘special economic zone’, a sort of experiment led by the government to test its new economic model. In this zones it was allowed foreign investment and the foundation of private companies. This was the catalyst which would allow the city to become the Chinese spearhead of technology over the next 30 years.

Shenzhen in 1980

The effects of the reforms came soon, the foreign funds and the construction of new factories brought in workers from all over China, attracted by higher salaries than the rest of the cities. Thanks to this, Shenzhen started to become one of the most important industrial cores of the country, and in the next decades it would set its focus on the production of technology. Foxconn, the biggest producer of electronic components in the world, would open a factory in the area in 1988. Today it has 400.000 workers, it’s the biggest factory in China, and it mainly produces iPhones.

From bust to boom

If you travelled to Shenzhen today, instead of a small village, you’d found a monstrous metropolis, which stands as one of the most important places in the world for the tech industry. With a surface of approximately 2000 square kilometres, and a population over the 12 millions, Shenzhen is currently one of the biggest cities of China; but that is, by far, the smallest of its achievements. Only here in 2016 were built more skyscrapers than in the US and Australia together. To describe this growing rate, the locals coined the term ‘Shenzhen Speed’.

‘Shenzhen Speed’ could be considered a local and more extreme version of the expression ‘generic city’. The latter was coined by the Dutch architect Rem Koolhaas in 1995, it makes reference to cities built in a short period of time (generally as a product of the demographic explosion of the 20th century) that arise because the need of accommodating lots of new people, and so they have no cultural background of themselves.

This lack of identity, nevertheless, makes Shenzhen a perfect black canvas. Around 90% of the population are foreigners, mainly from other parts of China, but also from the rest of the world. The reasons to come here are mainly professional; whether developing a career or just taking part in the world vanguard of technology. The abundance of big companies and venture capital funds make Shenzhen stand as one of the favourite destinations for ambitious young people, that’s why the average age of the city is about 28 years old.

Immigration here takes such a great role that the most spoken language is Mandarin, instead of Cantonese such as in the rest of China. But as advanced as it may look, the problems of precarious jobs and low salaries is still hot. This forces the young people that come to Shenzhen to share apartment under not so good conditions, and the rising presence of big companies is making the price of living go even higher. Also, working 6 days a week from 9 to 9 is a completely normal practice, and the whole city seems obsessed with work.

Technological epicentre

At the start of 2018, one of the most grandiose engineering projects in history came to an end, the biggest sea bridge of the world was built. Actually, it’s much more than a bridge, since it’s composed by the conjunction of four artificial Islands, three cable-stayed bridges and an undersea tunnel, connecting the Pearl River Delta region. Its goal, accelerating the economy of the region and ease the transportation between its cities, which of course includes Shenzhen. The success of the special economic zones in the 20th century made this region of China flourish, which led it to become the richest region in the south of China. Far from conformity, the government future plans aim to merge this whole territory into the biggest megalopolis ever created.

Shenzhen’s economy is not only important to China, but it’s also one of the biggest world exporters of electronics. Its port is a clear proof of this, the third with most traffic of the world just behind Singapore and Shanghai. Moreover, some of the most important tech companies of the world were born here. In 2006 DJI would take its first steps in a little office in the zone, today it’s the biggest drone business in the world, and in 2018 it accounted for a 74% market share.

Tencent, the biggest video game company in the world, has its headquarters in Shenzhen, and so it does BYD, leader of the electric vehicles industry along with Tesla.

In 1987 Shenzhen would see the foundation of Huawei by the ex subdirector of the People’s Liberation Army. In the next two decades, Huawei would move from being a minor enterprise to become the world’s biggest distributor of telecommunication equipment. It is also the biggest smartphone producer in China and the third in the world, yet far away from reaching Samsung and Apple. The huge growth of Huawei, plus its ties with the Chinese military and government, has made many western countries distrustful, for they see the company as a potential Chinese espionage service.

Even if it is one of the most open and advanced cities in China, Shenzhen is not free from governmental restrictions. As in the rest of China, services from western companies such as Facebook, Google or WhatsApp are banned, while its Chinese alternatives, such as WeChat, are encouraged. Developed by Tencent, this app is at the same time a social media site, a messaging net and a payment system. With more than a billion active users, it’s become one of the main pillars of the life in China. Its acceptance is so that the government is proposing to use WeChat profiles as official ID cards, and physical money it’s almost gone because of the ease of payment it offers.

Open source

Since the beginnings of the Internet, the open source movement hasn’t stopped growing; mainly in the software industry, since one click is enough to share any code with the rest of the world. And so, it can be improved by the community and checked by hundreds of people with the same interest, giving rise to very reliable software. It is because of this that today, even if most services and applications are not directly open source, the technology they are built on is.

If you try to apply this philosophy to hardware, things get messy. The biggest inconvenience is that hardware creation requires infrastructure and capital, so sharing it would be a clear waste of money. That’s why the hardware industry is much more reserved than the software, slowing the progress and throwing the sector companies into lengthy legal battles.

Shenzhen, thanks to its open culture, ignores this problem. Streets are full of hardware markets, where anyone can get lots of top electronic components at ridiculous prices, in part thanks to the abundance of factories nearby. Designs are constantly shared and each person tries to improve it with its own view. This generates a community where start-ups, individuals and big companies all row in the same direction, leading to a progress without precedents. Meanwhile, the rest of the world fails to keep track, hindered by legal battles and the ego of big companies.

The race against pollution

The Pearl River Delta growth is skyrocketing, and by 2025 it’s expected to double its consumer market from that of 2018. This, along with the increasing presence of China in all tech industries, makes the promise of becoming the greatest world power one to be aware of.

But limitless growth in a limited world seems to be a strategy that, as China already started noticing some years ago, looks to have no future. The two biggest problems it presents are super population and pollution. Even so, the Chinese government doesn’t look worried, and its expansionist policies are exemplified by what is known as land reclamation. This practice consists in generating an artificial terrain where there was water before, generally in order to expand an urban area, such as it is the case for the Shenzhen coast.

Trying to palliate the negative effects of such actions, the government has posed multiple measures to protect and regenerate the natural environment. Since 2010 pollution of Shenzhen’s air has decreased by 50% thanks to the use of electrical vehicles. Shenzhen is the first city in the world to achieve all its taxis and buses to be electrical. Other measures include the increase of urban vegetation and the closure or restriction of some of its most pollutant factories. But even with all the improvements that have been made, they are still very far from making a significant change to the environmental picture.

Maybe in the next decades, thanks to the development of new technologies and the improvement of the current ones, the Chinese growth model will become completely sustainable. If this happens soon enough, China could [undoubtedly] become the greatest world power of all history. But if instead pollution wins the race, the result would be, also without a doubt, apocalyptic.

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Hi, I'm Sergio Abreu García and this is my blog, where I mainly talk about technology & software. You can use my RSS feed to easily keep up with my content.





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