Can the Greater Bay Area really rival Silicon Valley?

December 20, 2018 09:00
Greater Bay Area represents a grand vision to integrate Hong Kong and Macau with nine Guangdong cities and help turn the region into a world-class tech and creative hub, among other things, but accomplishing the goals won’t be easy.  Photo:

What exactly is the Greater Bay Area? Those who came up with the concept are branding it as China’s answer to America’s Silicon Valley. Hong Kong and mainland leaders proudly boast it will rival and replace Silicon Valley as the world’s premier high-tech hub. But can it, and if yes, how?

After three years of hype, all we know about the Greater Bay Area is that it’s a grand vision to integrate Hong Kong and Macau with nine Guangdong cities that will somehow become a world-class technology powerhouse. Mainland officials were supposed to unveil details earlier this year. That didn’t happen.

Carrie Lam Cheng Yuet-ngor, Hong Kong's chief executive, now says the central government will unveil a blueprint next year. We’ll have to wait till then to know how exactly mainland officials intend to dethrone Silicon Valley by linking Hong Kong and Macau with nine neighboring Guangdong cities. But I just can’t help being skeptical.

When mainland and Hong Kong officials first talked about the Greater Bay Area vision, I immediately wondered to myself if it’s possible to plan or manufacture creativity. That’s exactly what the Greater Bay Area is – planned creativity. But creativity is at its best when it is free and spontaneous, not when it’s centrally-planned and controlled.

Silicon Valley isn’t a government-designated center of creativity. It evolved by itself over many decades. The stars aligned to make it the world’s premier high-tech hub. Its humble beginnings can be traced back to 1909, when the Federal Telegraph Company in Palo Alto – which is part of today’s Silicon Valley – invented a new type of radio transmitter, making it the first so-called tech company. Then came firms like Hewlett-Packard, which was founded in 1939 in Palo Alto.

In the 1940s, William Shockley co-invented the transistor while working for Bell Labs. He left Bell and founded his own company, Shockley Semiconductor Labs, which was the first company to use silicon for transistors, which are now called computer processors. His company was in Mountain View, California so he could be closer to his sick mother. Silicon Valley got its name from his use of silicon.

In 1957, eight Shockley staff resigned and partnered with Sherman Fairchild to start Fairchild Semiconductor, which made computer parts for America’s space program. Many of the eight eventually left Fairchild and started their own companies, including Intel in Santa Clara, which is also part of Silicon Valley. More Fairchild employees eventually left and founded AMD, Nvidia and other companies in Silicon Valley.

The area attracted other tech companies, including Xerox, Atari, Apple, Oracle, and a government research project that eventually became the internet. Over the following decades, companies such as Google, eBay, Facebook, Twitter, and Tesla all had humble beginnings in Silicon Valley but became big names.

Silicon Valley’s history is one of evolving creativity – from last century’s most basic technology inventions to today’s high-tech smartphones, computers, semiconductors, and other innovative creations. Silicon Valley would not have been possible without the free movement of people, unrestricted access to information, the free flow of ideas, an environment that allowed people to realize their dreams, the same legal system, and most importantly, the freedom to create and evolve, and succeed or fail without a government footprint.

Does the Greater Bay Area have all these qualities? The free movement of people is only partial because of the border that separates Hong Kong and Macau, and the border that separates these two cities from the nine mainland cities that are part of the Greater Bay Area. There is talk of making the movement of people easier within the Greater Bay Area, but how much easier can it be made without undermining one country, two systems?

Hong Kong’s legal system is vastly different from that of the mainland. The mainland’s tight internet censorship greatly restricts the free flow of information and ideas. Would foreign high-tech companies want to stake their future in the Greater Bay Area if they have no access to Google, WhatsApp, Facebook, and Twitter? Or is the Greater Bay Area intended only for home-grown companies that won’t mind censorship? If yes, can these companies compete on the world stage?

It can be argued that mainland tech giants such as Huawei, ZTE, Tencent’s Wechat, Alibaba, Baidu, and Weibo all flourished despite the mainland’s tight internet censorship. But let’s not forget the mainland’s social media platforms, smartphones, and search engine and online shopping sites took their cue mostly from Apple, Facebook, Twitter, Google, and Amazon. Recent developments have shown Huawei and ZTE depend heavily on US components to survive.

I am not saying the Greater Bay Area is doomed to fail. It can succeed even though it’s a centrally-planned concept instead of one that evolved on its own. But to succeed, it must be internationalized rather than domesticized. To be internationalized, it must allow foreigners to compete on an equal footing. It cannot shut out sectors to outsiders as the mainland now does. It cannot have forced technology transfers as the mainland now has.

Google, Yahoo, and Tesla, among other high-tech firms, were co-founded by foreigners. Silicon Valley is a melting pot of immigrants and high-tech people on work visas from all over the world, including from China and India. This willingness to welcome everyone with ideas and dreams is what made it a global high-tech powerhouse.

The Greater Bay Area may one day rival Silicon Valley but for now it has much to learn from Silicon Valley.

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A Hong Kong-born American citizen who has worked for many years as a journalist in Hong Kong, the USA and London.