Chengdu Emerging as Global Archetype for New Economy

CHENGDU, China, Nov. 23, 2017 /PRNewswire/ -- The joint venture established by Advanced Micro Devices, the American semiconductor company, and its Chinese partner is located in the Tianfu Software Park of Chengdu, China. Beneath a jungle of office towers, hotels and apartment buildings are swaths of shades under canopies and pedestrian walkways where lines of neatly arranged shared bicycles are parked alongside. Within one of these glass and steel edifices, the Chengdu branch of AMD is currently busy at working for developing a brand new type of chip. Experts explained that this kind of chip will replace counterparts from foreign manufacturers as it will enable Chinese super computers to operate with even more functions and higher compatibility.

As the fastest-growing professional software industry park in China today, the Chengdu Tianfu Software Park officially opened its doors in 2005 and has since then attracted nearly 250 tenants that include some of the country's and the world's most respected corporations like IBM, SAP, NEC, GE, NCSI, Huawei, Alibaba, Maersk, Siemens, Ericsson, Tencent, WIPRO and DHL, of which foreign-funded enterprises account for 40% of total.

These companies have long realized that Chengdu, as the capital of western China's superpower Sichuan province, is already endowed with the scientific and technological innovation capacity fit for becoming a world-class metropolis.

Today, international medical giant Medtronic and automotive behemoth Volvo have realized this trend as well. In October this year, Medtronic announced the decision to construct Centers for Therapeutic Innovation in Chengdu, which become the company's third project in Chengdu, more than in any other Chinese cities. Meanwhile, Swedish car-maker Volvo plans to set up a factory in Chengdu to manufacture Polestar, its new generation of electric vehicles.

Leveraging on science and technology to reshape industry structures and the new economy form of utilizing innovation to engender industry upgrading are quietly but surely changing the economic system of this central city of western China.

Actually, the term "new economy" first appeared in a 1996 article in BusinessWeek. It refers to an economy driven by information technology-induced revolutions and led by hi-tech industries under the economic globalization backdrop.

It is the time for new economy to play the leading role. Worldwide, the USA, Germany, Israel, Singapore and China have become the original places and active zones of new economy.

If choose one Chinese city as the model of the development and rise of new economy, Chengdu would be the best choice.

It has been introduced by the major leaders of Chengdu Municipal Government that the expansion of new economy in Chengdu roughly underwent three clear stages: in 2003, new economy emerged, hi-tech industries as represented by the electronic information industry began to make deployments, and electronic information technology started to find its way into different industries and sectors; in 2010, new economy began to pick up pace, and with the rise of strategic emerging industries like next-generation information technology, new materials and new energy, new technologies and new industries continued to appear and blossom; in 2015, new economy began to prepare for a powerful thrust, introduction of key human resources, innovation and entrepreneurship jointly became instrumental in all major industries and sectors, a group of hi-tech enterprises experienced rapid growth, and new economy is getting ready for a big bang.

In terms of promoting the new economy development, Chengdu always attaches great importance to the development of Internet, hi-tech, information industry and biological materials, and has laid profound foundation in those fields.

The latest data show that Chengdu owns 24,369 science and technology enterprises, 965 research and development facilities  of all kinds and 31 potential unicorn companies. In 2016, Chengdu's new economy industries is on track to grow by more than 10 percent, while the value of  hi-tech industry reached RMB 844.6 billion yuan, becoming the number one pillar industry.

Major leaders of Chengdu Municipal Committee of the CPC believe that other than emphasizing on hi-tech and innovation-driven growth, "new economy" should also stress on partnerships between  government, academia and enterprises, collaborations between academia and enterprises in research and development, and thoroughly transform human resources advantage into human capital advantage.

Chengdu is home to 56 institutions of higher education, more than 30 national-level scientific research institutes, 318 military industry companies and organizations and a rich reserve of human resource that includes nearly five million scientific and technological innovation talents. According to information from a relevant leader at the Chengdu Science and Technology Bureau, Chengdu has already signed strategic cooperation agreements with 13 higher education institutions from both within and outside Sichuan province such as Peking University and Sichuan University in order to support the co-establishment of knowledge economy circle around universities, research achievements commercialization areas and innovation and entrepreneurship concentration zones, with the purpose of effectively promoting project incubation, achievement commercialization and talents development. "At present, three pan-institution knowledge economy circles such as the pan-Sichuan University circle have already been established, capital investment from higher education institutions and private funding has reached more than RMB 875 million yuan, area of innovation incubation spaces exceeds 500,000 square meters, and over a thousand scientific and technological achievements from higher education institutions have been transferred or commercialized".

Since reforms in household registration policies for talents rolled out in July, Chengdu has already attracted more than 87,000 Masters or above degree-holders, of which about 15% from Ivy League schools. Meanwhile, previously announced report  2017 Returned Chinese Employment and Entrepreneurship Survey Report points out that Chengdu has climbed its way to the No.3 spot on the list of "the most preferred cities for employment and entrepreneurship among returned Chinese," just after Beijing and Shanghai.

The government's active steps in attracting funding, continual assembly of distinguished talents and prevalence of innovation and entrepreneurship, coupled with relatively lower land and labor costs compared with cities like Beijing and Shanghai, are all crucial factors that will propel Chengdu as China's most ideal city for cultivating new economy.

"Chengdu has already risen as an important engine behind the development of new economy in western China and along the Yangtze River Economic Belt". Wang Gaoxiang, Director of CCID Urban Economy Research Center of the Ministry of Industry and Information Technology, said, "Chengdu is the most suitable city for the development of new economy because it possesses the regional position conditions, innovation resources, industrial bases and policy environment beneficial to the development of new economy".

As new economy continues to strengthen and injects power into Chengdu's growth, the one-of-a-kind foundational advantages and development potentials have emboldened the city to dream bigger and plan further. Chengdu is poised to ascend as the global archetype for new economy.

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