Emerging tech investment helps Chinese cities thrive

Chinese cities that have strategically invested in emerging technologies will continue to thrive, as the broader economy still faces challenges both at home and abroad, according to a new report.

"Despite geopolitical headwinds impacting China's economic growth trajectory and momentum, this year's index sheds light on the success China is achieving through boosting investment in science and technology, as well as strategically refocusing its efforts to enhance its capabilities in emerging industries including artificial intelligence, autonomous vehicles and electric vehicles, which is the key to reinvigorating China's growth engine," said Perry Wong, managing director of Research at the Milken Institute, and author of the report.

Hangzhou, the capital of Zhejiang province and an emerging e-commerce hub, is ranked as China's best-performing city in 2023-2024, according to the Milken Institute's Best-Performing Cities China Index released on Wednesday.

As a key component of the Yangtze River Economic Belt, Hangzhou benefited from its strategic location and demonstrated remarkable economic strengths in this year's ranking. Once famed for tourism, the city is now a burgeoning hub for livestream e-commerce and boasts thriving sectors such as entertainment, finance and manufacturing, driven by strong tech investment and talent from top institutions like Zhejiang University, the report said.

Wuhan, the capital of Hubei province, rose 27 spots to take a noteworthy second place in the first-tier and second-tier cities ranking. Jinan, the capital of Shandong province; Changsha, the capital of Hunan province; and Chengdu, the capital of Sichuan province followed in third, fourth and fifth place respectively.

Beijing and Shenzhen in Guangdong province – two of China's most populated metropolises – held the eighth and ninth spots respectively. Meanwhile, Danzhou in Hainan province held the crown in the third-tier cities ranking.

"Overall, in this year's ranking, we noted that cities with significant tech hub presence displayed a high level of economic resiliency," the report said. "The central government's initiatives on fiscal stimulus policy mitigated numerous aspects of economic challenges that could have lasting impacts on cities' growth."

With promising potential shown by China's vibrant tech sectors and the country's priority on financial reform to achieve high-quality growth, Milken Institute said it remains cautiously optimistic about China's markets and economic outlook.