China Issues Guidelines for Constructing the Western Science City

Over the past few decades, China has been on a mission to set up special economic zones throughout the country as a way to bolster trade and development. Having set up the Chengdu-Chongqing Economic Circle, Beijing recently issued the ‘Opinions on Further Supporting the Accelerated Construction of the Western Science City’, an initiative aimed at strengthening economic cooperation and innovation between the two cities. It is hoped that this area will grow into a domestic trade powerhouse by 2035. 

Beijing has been making strides toward building a robust science and technology innovation ecosystem in Western China. To further support this strategy, the central government recently issued a notice entitled Opinions on Further Supporting the Accelerated Construction of the Western Science City (hereinafter referred to as the ‘Opinions’).

The Opinions, jointly developed by several government agencies, aim to establish the Western Science City as a nationally influential science and technology innovation center. Issued on March 31, 2023, the Opinions are now being implemented by relevant government units.

In this article, we discuss the measures proposed in the document and explore the potential economic impact on the region.

Introduction to the Chengdu-Chongqing Economic Circle

The Chengdu-Chongqing Twin City will promote closer cooperation and coordination between the two economically vibrant cities of Chengdu and Chongqing, both of which are in the west Chinese province of Sichuan.

The Twin City policy was introduced in 2016 by China’s central government. The idea was that two cities in a region could leverage each other’s strengths and reduce competition between them. This would promote balanced and sustainable development as resources are deployed optimally.

The Chengdu-Chongqing Economic Circle (Economic Circle), proposed in 2021, intends to do just that: establish a robust twin-city economic hub with unique characteristics by 2035.

Location and development objectives

The Master Plan for the Construction of the Chengdu-Chongqing Economic Circle (hereinafter, Master Plan) jointly released on October 21, 2021, by the Central Committee of the Communist Party of China (CCCPC) and the State Council includes the city of Chengdu, 27 districts (and counties) in Chongqing, and 14 other Sichuan cities.

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The Economic Circle spans an area of 185,000 square kilometers, with a population of over 96 million and a GDP of over RMB7 trillion (US$1 trillion).

As a large market in the hinterland of Western China, it will also play a crucial role in promoting the country’s dual circulation development strategy. Other key goals are becoming a world-class advanced manufacturing cluster and a prominent cosmopolitan destination.

Regarding improvements to the urban system, the Master Plan focuses on coordinated development between large, medium, and small cities.

Infrastructure connectivity, for example, will be improved to enhance the quality of life for local residents. To achieve these objectives on time, the Economic Circle has set targets for major progress in several areas by 2025.

Role of the Western Science City in the Economic Circle

Chengdu and Chongqing have been among the fastest-growing cities in China over the last decade. In 2022, the GDP of both Chengdu and Chongqing surpassed the RMB 2 trillion mark (about US$294.4 billion).

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Yet, on closer scrutiny, there are multiple challenges facing the twin cities, including overcapacity in certain industries and the need for more capacity building in areas of innovation, scientific research, and technological advancement.

It is hoped that the Western Science City, being developed in Chongqing, will attract more talent and investment to the region to cultivate innovation, strengthen technology companies, develop tech finance, promote tech transactions, and advance technology exchanges. This could direct industrial development into new areas and encourage value-added production.

The Western Science City covers an area of 1,198 square kilometers across five districts in Chongqing: Shapingba, Beibei, Jiulongpo, Jiangjin, and Bishan.

China’s Master Plan for the development and construction of the Western Science City

The master plan contained in the Opinions outlines specific government actions and their scope.

Below, we highlight key proposals.

Fostering innovation

To build strategic technological strength and foster innovation at a national level, the government is implementing various measures. These include:

• Establishing a high-level laboratory system: The government will implement central decision-making arrangements to participate in the construction of the national laboratory “core + base + network” and provide service guarantees to support leading scientific and technological forces. Key advantage areas will receive support for the construction of national key laboratories in the Western Science City. The government will also support the joint construction of the Sichuan-Chongqing Joint Laboratory and the plan to build a batch of provincial (municipal) laboratories.
• Concentrating on the layout of major scientific and technological infrastructure clusters: Beijing aims to accelerate the construction of the Chengdu-Chongqing comprehensive scientific center and promote the rapid implementation of prerequisite conditions for various facilities.
• Jointly building major innovation platforms: The government aims to integrate innovation resources in the Chengdu-Chongqing region to cultivate and create the Chengdu-Chongqing National Technology Innovation Center. This includes the construction of a batch of national industrial innovation centers, engineering research centers, technology innovation centers, medical research centers, medical centers, and other innovation platforms.
• Cooperating to build first-class university research institutes and new research and development organizations: Beijing plans to rely on the regional advantages of top universities and disciplines to strengthen basic research and original innovation capabilities.

Focusing on key technologies to enhance the competitive advantages of strategic industries

The Opinions contain guidelines to enhance the strategic competitiveness of key industries through technology collaboration and innovation. These include:

• Increasing collaboration in scientific and technological research: Establish a mechanism for technology collaboration among different government departments and provinces (or cities).
• Collaborating to develop key core technologies: Encourage the Chengdu-Chongqing region to focus on world-leading technology and key national needs, actively undertake major national scientific and technological projects in basic research, applied basic research, and core technology research fields.
• Shaping industrial competition: Support the creation of world-class automobile, electronic information, equipment manufacturing industry clusters, and related high-tech service industry agglomeration areas. Cultivate and construct national-level high-tech industrialization bases, such as hydrogen energy, high-end dental equipment and materials, military intelligent equipment, medical isotopes, and radiopharmaceuticals. Promote the construction of national new-generation artificial intelligence innovation and development pilot zones, national artificial intelligence innovation and application leading zones, and national digital economy innovation and development pilot zones.

Policy environment optimization

In its reform of the science and technology system, the government is set to pilot more convenient policies to attract talents in the area. These include:

• Optimizing the approval process for work permits and work-related residence permits for foreigners in China, and conducting pilot projects for cross-regional talent integration guarantees.
• Allowing for more lenient personnel entry and exit policies approved by foreign affairs management departments during events such as the Belt and Road Science and Technology Exchange Conference.
• Accelerating the improvement of public transportation and living facilities in the Western Science City.

Strengthening cooperation

The Opinions propose the following to strengthen cooperation at the national and global level:

• Building a high-level “Belt and Road” science and technology innovation cooperation zone and an international technology transfer center.
• Laying out international science and technology cooperation bases and country-specific cooperation parks.
• Establishing joint laboratories, global R&D centers and international science and technology parks to eventually participate in and explore international major science programs and projects.

How will the options impact the development of the Chengdu-Chongqing area?

Foreign businesses seeking investment opportunities in China’s rapidly developing western region should seriously consider the Chengdu-Chongqing area.

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The 2023 Opinions offer a window to China’s regional development strategy that prioritizes technology-led growth, establishing knowledge hubs, and fostering an environment that promotes innovation and avoids duplication of resources to build up capacity.

Integrating the leading economies of Chengdu and Chongqing, for example, allows Western China to leverage their respective strengths to promote a higher quality of development. Altogether, policies like the Twin City approach will reduce China’s dependence on foreign technology while enhancing its global competitiveness.

If successful, this policy could serve as a model for other regions, building more science cities, promoting advanced manufacturing and technology industries, and helping China achieve its goal of becoming a global leader in science and technology.

It could also channel greater investment into Western China, creating more economic opportunities for the region and reducing the economic gap between the East and West, a longstanding issue in the country.

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