Motor city rising as China's high-tech hub

Wuhan, China's "motor city," received a new boost in its pursuit of building a high-tech hub Wednesday with the opening of Chinese tech firm Xiaomi's new headquarters.

The new Xiaomi headquarters will focus on the development of several of the company's core technologies including artificial intelligence (AI), the Internet of Things and big data, according to the Beijing-based company.

"My expectations for the next decade are to turn Wuhan into a large R&D center of Xiaomi and an AI-era technological highland," said Lei Jun, founder and chairman of Xiaomi, at the opening ceremony.

The company is the latest tech heavyweight to settle in the East Lake High-tech Development Zone, commonly known as Optics Valley, to boost the city's initiative of building an innovation powerhouse.

The capital of Hubei province is witnessing a tech boom with rapid developments registered in emerging industries including optoelectronic information, intelligent manufacturing and high-tech services.

Optics Valley, lying at the heart of the city's high-tech drive, now boasts over 90,000 companies. In 2018, it registered 88 new enterprises each workday and received as many as 29,000 patent applications, official data shows.

It drove the output of Wuhan's high-tech industries above the designated size to exceed 1 trillion yuan ($143 billion) in 2018, an increase of 16.1 percent year-on-year. That year, Wuhan enjoyed yearly GDP growth of 8 percent, higher than the national average, even as sluggish car sales weighed on the city's pillar automotive industry.

From cars to tech

Wuhan, a major producer of steel and vehicles, began to encourage the high-tech industry in 1988, with the establishment of the East Lake High-tech Development Zone. In recent years, the sector picked up steam amid the national trend of optimizing industrial structures.

The industrial park, already the world's largest producer of optical fiber and cables, has also become an ideal destination for the new headquarters of tech firms. In 2017, AI heavyweight iFlytek and internet-based firms like Qihoo 360 and Kingsoft located their second headquarters there. It also houses the research centers of e-commerce giant Alibaba and tech giant Huawei.

High-tech fever is also sweeping other second-tier Chinese cities. Nanchang, capital of Jiangxi province, is nurturing a virtual reality (VR) industrial cluster, while Changsha, capital of Hunan, is a testing ground for the country's state-of-the-art self-driving vehicles.

"Five years ago, Optics Valley was still an 'internet desert,'" said Wang Jiapan, an official with the park. He recalled how an article about the absence of internet firms in Hubei galvanized officials into action in 2017.

Another aim of Optics Valley is to retain the city's many university graduates, over 1 million every year, who used to flock to first-tier cities like Beijing and Shanghai where new industries abound, Wang said.

A slew of supportive policies has been rolled out since then to attract tech firms, including the 10 incentives issued earlier this month to encourage innovation and startups.

Xiaomi has praised Wuhan's favorable policies and support for the smooth opening of its headquarters, which took less than two years. "Xiaomi's layout in Wuhan ... reflected the 'speed of Optics Valley,' which completely exceeded my expectations," Lei said.

"Optics Valley is now among the most innovative and fastest-growing regions in central China," said Wang Xiangwang, a standing committee member of Wuhan's municipal committee of the Communist Party of China.

With the goal to register 20,000 new companies each year and reach an annual GDP of 200 billion yuan by 2021, Optics Valley is quickly becoming an influential global high-tech hub, he added.