Saudi Press

Saudi Arabia and the world
Monday, Jun 02, 2025

Why China is looking to Shenzhen – and not Hong Kong – to reinvent its economic future

Why China is looking to Shenzhen – and not Hong Kong – to reinvent its economic future

The southern mainland city was a test bed for market reforms 40 years ago and now Beijing is banking on it to spearhead development in the years ahead. The central government is finding it tough to implement its policies in Hong Kong, analysts say
When a commission chaired by Chinese President Xi Jinping endorsed a document last week to give Shenzhen special status to carry out bolder reforms as a model for other cities, the move attracted little attention outside mainland China.

The guidelines were endorsed by the Central Committee for Deepening Overall Reform – the top body overseeing economic and administrative reforms – and designed to promote Shenzhen as a “pilot demonstration area of socialism with Chinese characteristics”.

A report by state news agency Xinhua about the meeting gave only a broad description, saying the special status was given to Shenzhen to further boost its “innovation-focused development strategy” so that the city could achieve high-quality growth and become a model for other mainland cities.
While there were few details about the plan, analysts said the document did signal Shenzhen’s rising status in the Greater Bay Area
and pointed to a policy shift in Beijing away from Hong Kong and towards mainland cities to drive the region’s development.

They said the new status meant Shenzhen would receive support from Beijing for bolder economic and administrative reforms.

Zhang Yansheng, chief research fellow with the China Centre for International Economic Exchanges, said Beijing wanted Shenzhen to experiment with blending innovation and socialism.

“The past 40 years [in China’s opening up and reform] was about making socialism and the market economy compatible. [Now] the Shenzhen pilot demonstration zone aims to make socialism compatible with technology and innovation development,” Zhang said, adding that the city would be at the forefront of a new phase of opening up.

“In the past 40 years, Shenzhen has been very successful … In the next 40 years, can Shenzhen become a trailblazer in terms of regulations and modernisation so that it will become a model for the whole country?”

Li Xiaobing, an associate law professor at Nankai University in Tianjin, said China needed new ways to boost its economy, particularly with its rivalry with the United States.

Li said Shenzhen had proved itself over the past 40 years and China now wanted it to come up with new policy ideas that could be replicated elsewhere.

“Shenzhen has to come up with its own innovations and experiments. The central government is willing to give it room [to devise new policies] and wants it will take on the role [of a model city]. As long as you can become a trailblazer, the central government will certainly give you support and endorsement,” he said.

Peng Peng, a researcher with the Guangzhou Academy of Social Sciences, said that with the new status, Shenzhen would have Beijing’s blessing to take its industrial innovation to a higher level.

“It should become an innovation metropolis with global influence,” the Southern Metropolis News quoted Peng as saying.

But Li said Shenzhen’s role would go beyond industry to also test changes to the legal process.

“The guidelines also mentions legal institutions. The advantage of Hong Kong is its rule of law and we don’t want Shenzhen just to be a successful commercial area … We would want its legal institutions to become compatible with its size and influence,” Li said.

Shenzhen was the first test bed for market reforms when late paramount leader Deng Xiaoping introduced them 40 years ago.

With China now locked in a trade war with the US, Beijing is banking on the hi-tech sector to spur development and cut reliance on imports of key technologies. Amid threats to stop selling microchips to Chinese companies such as ZTE and impose sanctions on Chinese telecom giant Huawei, Xi has repeatedly called for industry to innovate and become more self-reliant.

In February, Beijing unveiled the ambitious Greater Area Bay blueprint aimed at transforming Hong Kong and 10 Guangdong cities into a combined economic powerhouse, with Hong Kong, Macau, Shenzhen and Guangzhou identified as the four “pillars” of development.

The blueprint highlighted the advantages of each of the four pillars and reassured Hong Kong that it would continue its role as the leading financial centre.

Li said Hong Kong still had an edge but the central government would not wait if the city’s turmoil continued.

“Hong Kong has its advantage. With the plan for the Greater Bay Area, we want to see its advantages fully developed and enhanced. However, if Hong Kong is stuck in internal turmoil and if social order cannot be restored, then such a goal will not be achieved,” Li said, referring to protests triggered by a now-shelved extradition bill that would have allowed the extradition of suspects to the mainland.

“The competition [in the world market] is cruel and China-US rivalry is still continuing. We need new measures for development … Shenzhen has been running for 40 years and you cannot ask it to hold back. It has to go further and be transformed now.”

Tian Feilong, an associate law professor at Beihang University in Beijing, said Beijing had struggled to implement its policies in Hong Kong and so had a strong incentive to shift the focus of the Greater Bay Area to the mainland.

“In the future, the reform and opening up of the Greater Bay Area will focus on the mainland instead of Hong Kong,” he said. “The traditional advantages of Hong Kong are fading and it is getting more difficult for central government’s policies to be implemented there.”

Zhang Dinghuai, a Hong Kong policy researcher at Shenzhen University, said the central government hoped that Shenzhen could drive the economic development of the Pearl River Delta.

Zhong Wei, an economics professor at Beijing Normal University, told a forum over the weekend that the Greater Bay Area would be the most promising economic region in China and mainland cities would take the lead.

“Please don’t think too much about Hong Kong or Macau – Guangdong will lead the future,” Zhong said, according to a transcript published online.

Zhong said Hong Kong was only a “quasi first-tier city” in China while Shenzhen and Guangzhou were now in the top rank.

In 2018, Shenzhen’s economy surpassed Hong Kong’s for the first time. While economic growth in Hong Kong rose by just 3 per cent to HK$2.85 trillion (US$363 billion) last year, Shenzhen’s gross domestic product last year grew by 7.6 per cent to 2.42 trillion yuan, or HK$2.87 trillion based on the 2018 official exchange rate.

Newsletter

Related Articles

Saudi Press
0:00
0:00
Close
Paris Saint-Germain's Greatest Triumph Is Football’s Lowest Point
OPEC+ Agrees to Increase Oil Output for Third Consecutive Month
Turkey Detains Istanbul Officials Amid Anti-Corruption Crackdown
Meta and Anduril Collaborate on AI-Driven Military Augmented Reality Systems
EU Central Bank Pushes to Replace US Dollar with Euro as World’s Main Currency
European and Arab Ministers Convene in Madrid to Address Gaza Conflict
U.S. Health Secretary Ends Select COVID-19 Vaccine Recommendations
Trump Warns Putin Is 'Playing with Fire' Amid Escalating Ukraine Conflict
India and Pakistan Engage Trump-Linked Lobbyists to Influence U.S. Policy
U.S. Halts New Student Visa Interviews Amid Enhanced Security Measures
Trump Administration Cancels $100 Million in Federal Contracts with Harvard
SpaceX Starship Test Flight Ends in Failure, Mars Mission Timeline Uncertain
King Charles Affirms Canadian Sovereignty Amid U.S. Statehood Pressure
Iranian Revolutionary Guard Founder Warns Against Trusting Regime in Nuclear Talks
UAE Offers Free ChatGPT Plus Subscriptions to Citizens
Lebanon Initiates Plan to Disarm Palestinian Factions
Iran and U.S. Make Limited Progress in Nuclear Talks
The Daily Debate: The Fall of the Dollar — Strategic Reset or Economic Self-Destruction?
Trump Administration's Tariff Policies and Dollar Strategy Spark Global Economic Debate
OpenAI Acquires Jony Ive’s Startup for $6.5 Billion to Build a Revolutionary “Third Core Device”
Turkey Weighs Citizens in Public as Erdoğan Launches National Slimming Campaign
Saudi-Spanish Business Forum Commences in Riyadh
Saudi Arabia and Spain Sign MoU to Boost SME Sectors
UK Suspends Trade Talks with Israel Amid Gaza Offensive
Iran and U.S. Set for Fifth Round of Nuclear Talks Amid Rising Tensions
Russia Expands Military Presence Near Finland Amid Rising Tensions
Indian Scholar Arrested in Crackdown Over Pakistan Conflict Commentary
Israel Eases Gaza Blockade Amid Internal Dispute Over Military Strategy
President Biden’s announcement of advanced prostate cancer sparked public sympathy—but behind closed doors, Democrats are in panic
A Chinese company made solar tiles that look way nicer than regular panels!
Indian jet shootdown: the all-robot legion behind China’s PL-15E missiles
The Chinese Dragon: The True Winner in the India-Pakistan Clash
Australia's Venomous Creatures Contribute to Life-Saving Antivenom Programme
The Spanish Were Right: Long Working Hours Harm Brain Function
Did Former FBI Director Call for Violence Against Trump? Instagram Post Sparks Uproar
US and UAE Partner to Develop Massive AI Data Center Complex
Apple's $95 Million Siri Settlement: Eligible Users Have Until July 2 to File Claims
US and UAE Reach Preliminary Agreement on Nvidia AI Chip Imports
President Trump and Elon Musk Welcomed by Emir of Qatar Sheikh Tamim with Cybertruck Convoy
Strong Warning Issued: Do Not Use General Chatbots for Medical, Legal, or Educational Guidance
Saudi Arabia Emerges as Global Tech Magnet with U.S. Backing and Trump’s Visit
This was President's departure from Saudi Arabia. The Crown Prince personally escorted him back to the airport.
NVIDIA and Saudi Arabia Launch Strategic Partnership to Establish AI Centers
Trump Meets Syrian President Ahmad al-Shara in Historic Encounter
Trump takes a blow torch to the neocons and interventionists while speaking to the Saudis
US and Saudi Arabia Sign Landmark Agreements Across Multiple Sectors
Why Saudi Arabia Rolled Out a Purple Carpet for Donald Trump Instead of Red
Elon Musk Joins Trump Meeting in Saudi Arabia
Trump says it would be 'stupid' not to accept gift of Qatari plane
Quantum Computing Threatens Bitcoin Security
×