A City of Innovation

Authors: The Washington Post


Chengdu has been the regional hub of southwestern China for centuries, but its recent embrace of technology shows that it’s not content to rest on its laurels.
Chengdu has been the regional hub of southwestern China for centuries, but its recent embrace of technology shows that it’s not content to rest on its laurels.
The only thing foreign readers may know about Chengdu, the capital of Sichuan province, is that it’s famous for giant pandas and hotpot. However, the inland city in southwestern China is closely bound up in the work and lives of people around the world.
Think about this: one out of five computers in your office is made in Chengdu, one out of two laptops in your classroom has its chip packaged and tested in Chengdu, and two out of three iPads come from Chengdu.
Multinationals have flocked to the regional hub in recent years as China’s “go west” campaign has expanded. And more are arriving in hope of exploiting the opportunities offered by national strategies to develop the Silk Road Economic Belt, the Yangtze River Economic Zone, and the Tianfu New Area.
With a large talent pool, rich natural resources, and huge market potential, Chengdu has become home to 262 Fortune Global 500 companies, such as Intel, Dell, Texas Instruments, and Foxconn.
The ancient city remains keen to make a mark on the world. In its 3,000-year history, Chengdu invented the world’s earliest paper currency Jiaozi, the elegant Shu brocade, and world-renowned Sichuan cuisine. Today, it’s attempting to have an even greater impact on the world with more “created-in-Chengdu” products.
Unlike the giant pandas who spend most of their time eating and sleeping, companies in Chengdu are running at full speed to catch up with the world, and making the “land of abundance” into a land of innovation.
“We start much later than the leading foreign companies, but innovation could help us lead the future,” said Zhang Ming, president of Sichuan Sunfor Light Co, a producer of L.E.D. lighting equipment.
Zhang is confident that his company’s products will have a strong impact on the lighting industry and challenge the giants in the field.
Rare breakthrough
In 2013, the company made a breakthrough by incorporating rare-earth luminescent material in L.E.D. lighting technology, a move that was hailed by 10 members of the Chinese Academy of Sciences.
Most of the L.E.D. products on the market have to be fitted with a converter to change AC into DC, to avoid the eye-damaging stroboflash caused by alternating current.
However, the rare-earth luminescent powder developed by Sunfor Light glows in accordance with AC frequencies, freeing L.E.D. products from the stroboflash problem powered by AC electricity, the academicians said.
They said that the technological achievement had opened up a brand new route for A.C. L.E.D. lighting.
“The new products can last as long as 10 years, and they are 15 to 20 percent more energy-efficient than direct current L.E.D. products,” Zhang said.
The new technology helped Sunfor Light actively expand its global reach in 2014, winning customers from countries including the United States, Germany, Russia, Spain, and Brazil.
The company’s revenue rose 30 percent to US$45million last year, despite the economic downturn in the country. “Exports topped US$5 million in 2014, and we expect the number to triple this year,” he said.
Zhang said the support of local government has helped the company in a number of ways, from obtaining bank loans to expand office space. “The Chengdu government attaches great importance to innovation, and has formulated a number of policies to encourage innovation,” he said.
Early in February, Chengdu officially launched the “Entrepreneurial Tianfu” program, to encourage university students, scientific and technological talents, and top overseas talents to start business and boost innovation in the city. According to the plan, Chengdu is to be built into an internationally renowned city of innovation and entrepreneurship by 2025.
“The development potential, good living conditions, and Chengdu’s cultural environment have helped companies attract and retain talents from around the country,” Zhang said. More than half of Sunfor Light’s employees come from places outside Chengdu and Sichuan.
The city has the largest number of universities and colleges in western China, being able to provide enterprises with at least 150,000 graduates and 100,000 technicians every year. Most of them would choose to stay in Chengdu.
By the end of last year, Chengdu had had 1.5 million professional and technical personnel, more than 30,000 technological enterprises, and 84 innovation and entrepreneurship carriers covering 2.8 million square meters in total. 198 venture capital organizations have registered in Chengdu, managing capital of 60 billion yuan ($9.6 billion).
Sole survivors
Some traditional industries are thriving, too. Sheme, a woman’s shoe brand from Chengdu that combines traditional Chinese cultural elements and Western fashion, has won international fame. The brand, which targets the high-end market, was launched in 2009 by Chengdu Aiminer Leather Products Co.
In late 2013, Sheme debuted its “Butterfly and Blossoms” collection at London Fashion Week, making it the first Chinese footwear brand to be exhibited at the renowned event.
Founded in 1996, Aiminer was originally a small operation with just 20 employees, but with Chengdu's open up to the outside world, Liu Qiongying, Aiminer’s owner, went overseas in search of business opportunities.
“China is so rich in cultural resources, why not incorporate those references into the shoes?” she asked herself, while visiting an international brand’s show case event in Italy.
To further that vision, Liu invited designers from Canada, France and Italy to join her design team. They absorbed the Chinese elements in fine art, architecture, opera and embroidery to improve the brand’s international standing.
Today, the company has stores in the best stalls in Beijing, Shanghai and Chengdu, and is in direct competition with international luxury brands. Now, there are plans to open stores in London, Paris, Milan, and Hong Kong SAR.
In addition to Sheme, Aiminer has other four brands. The company produced 1.5 million leather shoes for women in 2014, and about 90 percent of them were for export to more than 30 countries, including Germany, Italy, Russia, Poland, the US, Australia, and Japan.
Logistical advantages
Chengdu’s well-developed logistics system has benefited local companies. Chengdu Shuangliu International Airport is the largest in China’s central and western region, with 78 international routes linking the city to places such as London, Amsterdam, Frankfurt, San Francisco, and Melbourne.
The State Council and the CPC Central Military Commission recently approved the construction of a new airport in Chengdu, which will make it the third city on the Chinese mainland to have a second airport, after Beijing and Shanghai. The new airport is expected to handle more than 40 million passengers and 700,000 tons of cargo a year by 2025.
The Chengdu-Europe express, which runs close to parts of the legendary Silk Road, is a weekly freight train that starts in Chengdu and ends in Lodz, Poland. It’s the fastest direct freight route from China to Europe, according to the Chengdu Logistics Office. It takes at least 40 days to transport products from Chengdu to Europe by sea, but only 14 days by rail. The express rail is expected to open return service in March.
“The express shortens the journey time from Chengdu to Europe. It’s more expensive than sea transport, but much cheaper than air,” Liu said. “As the starting point of the South Silk Road, Chengdu is blessed with a good environment for innovation and creativity. We look forward to reaching out to the world with a wide range of creative products.”

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