2 years on: Pudong makes remarkable progress in socialist modernization

It has been two years since China's central government on July 15, 2021 issued a guideline regarding the transformation of Shanghai's Pudong New Area into a pioneering area for socialist modernization, and Pudong has already made remarkable achievements enroute to achieving this goal.

For instance, 413 of the specified 450 tasks in the guideline have already been accomplished or have seen breakthroughs over the past two years. The tasks involve integration of reforms in different areas, institutional opening-up, global resource allocation, scientific and technological innovation, and modern urban governance.

Foster innovation and promote high-quality industrial development

Over the past two years, Pudong has persistently emphasized the importance of incorporating the achievements of reform and opening-up into the results of high-quality development, and has been fostering a conducive business environment and an innovative ecosystem that attracts diverse enterprises, institutions, and talents. As a result, various new technologies, products, models, and formats continue to emerge.

At the recently concluded World Artificial Intelligence Conference, the "digital twin city", a virtual replica of a real city, and "sign language interpretation digital people" technologies received significant attention. These technologies were from DGene, a digital technology research and development (R&D) company based in Pudong's Zhangjiang, a sci-tech hub.

Zhang Chaohua, CEO of DGene, introduced the sign language interpretation technology in an interview, saying: "The process involves collecting actions to establish an 8,000-word corpus. The next step is recognition, where the system identifies the sign language actions and understands the key words to form a sentence. Finally, the system generates sign language expressions based on the entered sentence or sound, enabling deaf individuals to understand the information."

With the support of ShanghaiTech University, DGene was established in Zhangjiang in 2016 and has since developed the "digital twin city", virtual exhibitions, and digital people technologies, all of which have provided technical support for numerous large-scale events in China.

Reflecting on the growth of the company, Zhang said: "We started with only about 20 people in a small room. Now, our company occupies almost half a floor with nearly 100 employees, and our ‘digital twin city' and digital people product lines have experienced rapid development this year. Our success can be attributed to factors such as talent acquisition, preferential policies like tax incentives, as well as local entrepreneurial atmosphere."

To help regional enterprises develop and transform original technologies, the Yangtze River Delta National Technology Innovation Center, headquartered in Zhangjiang, Pudong, was officially inaugurated in June 2021.

Tan Ruicong, deputy director of the center, said, "The center's purpose is to select promising projects from universities and institutes, and then promote them in the market."

Pudong now has a comprehensive innovation incubation system consisting of incubators, technology accelerators, and open innovation centers set up by industry leaders. A total of 75 such open innovation centers now provide support to over 2,600 small and micro enterprises.

Meng Xiangdun, the head of a start-up in Pudong, said: "Our company developed an intelligent robot system and Pudong's incubator has provided us with great help, including offering office space and laboratories. Additionally, the incubator has helped us connect with investment and financing opportunities and access industrial resources."

In the past year, Pudong has seen remarkable growth in industries such as integrated circuits, biomedicine, and artificial intelligence, and is moving towards becoming a world-class industrial cluster in these areas. The scale of these industries has exceeded 220 billion yuan （$30.79 billion）, 330 billion yuan, and 120 billion yuan respectively, accounting for about 75 percent, 40 percent, and 40 percent of the city's total.

In 2022, the area's GDP exceeded 1.6 trillion yuan and accounted for 35.9 percent of Shanghai's total. Its total industrial output value has also grown steadily. From January to May, the output value of industrial enterprises above designated size in Pudong was 538.6 billion yuan, a significant increase of 24.9 percent year-on-year.

Over the past two years, Pudong has recognized 3,250 high-tech enterprises and 81 "little giant" science and technology enterprises. There is also a group of innovative enterprises that have developed independent intellectual property rights. Additionally, the number of companies in Pudong that are listed on the Science and Technology Innovation Board has reached 46, accounting for 57 percent of the city's total.

Continue to expand opening up and create a world-class business environment

Pudong has the most foreign-funded R&D centers in Shanghai. As of February, Pudong had 254 recognized centers, accounting for nearly half of the city's total. Over the past two years, Pudong has welcomed 59 new regional headquarters of multinational companies. From January to May, 13 more headquarters were added, bringing the total to 432, or 47 percent of Shanghai's total.

BASF is a global leading chemical company with over 350 production sites and companies in 39 countries worldwide. Recently, the BASF Shanghai Pudong Innovation Park Phase III project was completed and put into use. As the company's largest research and development base in the Asia-Pacific region, the two new research buildings will be used to advance project research and develop innovative sustainable solutions.

BASF Greater China's Chairman and President Lou Jianfeng has expressed the company's unwavering commitment to the Chinese market.

"China currently represents 50 percent of BASF's global market, and this motivates us to continuously invest in the country," said Lou.

"These investments are not just limited to expanding production capacity but also include promoting innovation and transforming research outcomes into commercialized products. Such commitment are aligned with BASF's original intention to cultivate ongoing investments in China and drive innovation forward."

As a global leader in automation technology, Festo has expanded its laboratory in the Jinqiao Comprehensive Free Trade Zone in Pudong from 600 square meters to 2,000 square meters. The company also plans to invest about 10 million yuan to enhance its research and development capabilities this year.

"We are very confident in the future development of our company. The conducive business environment in Shanghai provides us with a positive outlook, and we firmly believe that 2023 will be a year filled with remarkable achievements and successes," said Sebastian Beck, president of Festo (China) Co Ltd.

This year, Pudong has released an action plan that is aligned with the 10 evaluation indicators of the World Bank for "business-friendly environment". The plan includes 20 key tasks aimed at fostering a market-oriented, law-based and world-class business environment for enterprises.

"By leveraging the advantages of the China (Shanghai) Pilot Free Trade Zone as a hub for institutional innovation and tapping into the potential of each district as the key destination for foreign investment, Shanghai has enhanced efforts in attracting and nurturing foreign-funded R&D centers, while also creating a more open and favorable business environment," said Sheng Hongyan, director of the Foreign Investment Promotion Department of the Shanghai Municipal Commission of Commerce.

"These actions have resulted in new opportunities for foreign-funded enterprises and have instilled confidence in multinational corporations, making Shanghai the preferred destination for foreign investment."

In 2021, Pudong released its Group Open Innovation (GOI) plan to serve its goal of becoming a pioneering force in the socialist modernization of China and a key engine in self-reliant innovation. The GOI plan encourages industry leaders to set up open innovation platforms, and many companies have already joined the plan.

Covestro, a renowned multinational corporation which has been operating in China for nearly two decades, was one of the first companies to join the GOI plan. The company has "upgraded" its China headquarters in Shanghai to its Asia-Pacific headquarters.

"We believe that China is absolutely a leader in innovation," said Michael Schmidt, head of Global Innovation Management at Covestro. "The country rolled out many measures to further open up, giving us confidence in the Chinese market."