Shenzhen: The Technology Manufactoring Capital

If you have a phone, computer, TV, or any piece of electronics, it was most likely made in Shenzhen, a city located in the Guangdong province of China. As a matter of fact, 90% of the world’s consumer electronics are made in this megacity – iPhones, laptops, tablets, gaming consoles, and much more. If you’ve ever owned an Apple, Microsoft, Dell, or Sony product, it was made in Shenzhen, the electronics manufacturing capital of the world.

With flashy lights, skyscrapers, malls, restaurants, fancy tech, and factories everywhere, it’s hard to tell that not too long ago, Shenzhen was simply a quiet, rural fishing village, and an insignificant dot on the map, overshadowed by bigger cities such as Shanghai and Beijing. What happened?

History

Deng Xiaoping took power in the People’s Republic of China in 1978 and turned China toward a path of opening up to the rest of the world. As a result of this,  special economic zones were set up in four cities: Shenzhen, Zhuhai, Shantou, and Xiamen. In these special economic zones, policies were made aimed at encouraging foreign investment, private ownership, and free market forces.

Shenzhen was a place where the taxes and manufacturing costs were low enough to make it cheaper to manufacture there than in the United States. Because of this, it attracted thousands of foreign investors, who provided the capital necessary to transform the rural fishing village into a modern metropolis. People who were able to visit Shenzhen during this time period told stories of cranes, construction sites, and construction workers everywhere. The foreign investment and manufacturing allowed for this special economic zone to grow at an astounding rate, with over $30 billion USD being invested into the city since 1979.

The phenomenon has been dubbed “the Miracle of Shenzhen,” where a tiny town of no more than 30,000 turned into a megacity of 11 million people – more than New York City. Shenzhen is China’s third largest city, behind Shanghai and Beijing, and it continues to grow, attracting workers from the countryside who are looking for a better life.

Outsourced manufacturing by Silicon Valley giants to Shenzhen has become extremely common nowadays, thus adding to the phenomenon many Americans face when looking on the label on their everyday products: “Everything’s made in China!” Shenzhen is a great metaphor for China’s prosperity and fast levels of economic growth, opening up to the world and embracing manufacturing allowed for huge leaps in modernization, technology, and standard of living.

Other countries around the world have been trying to mirror the success of Shenzhen, with varying levels of success. The concept of the special economic zone has caught on in Asia, where Vietnam, South Korea, the Philippines, Thailand, and Indonesia have all rolled out economic zones. Japan’s prime minister, Shinzo Abe, announced a series of new special economic zones in 2014, and Rwanda has developed a strategic plan for them, while India’s minister says that they could add 2% to its GDP.

However, the success that manufacturing brought Shenzhen might not last. As China’s economy develops from manufacturing, labor prices become higher and higher, ironically making Chinese manufacturing more expensive. Today, Shenzhen is an extremely expensive city to live in, with real estate prices that surpass those in Beijing, Shanghai, New York, and San Francisco. Automation is also a huge potential threat to Shenzhen’s manufacturing industry. If Silicon Valley wanted to fully automate their production lines, there would be no benefit to cheaper labor costs, so it would make more business sense for them to manufacture in the United States, as it would cut shipping costs and be a good PR move.

Regardless of the metropolis’s uncertain future, Shenzhen still remains one of the world’s best success stories, where manufacturing and privatization allowed for economic growth and prosperity.

Sources:
https://www.theguardian.com/cities/2016/may/10/story-of-cities-39-shenzhen-from-rural-village-to-the-worlds-largest-megalopolis
https://www.travelandleisure.com/culture-design/shenzhen-china-culture
https://www.forbes.com/sites/wadeshepard/2016/07/14/a-look-inside-shenzhens-high-tech-empire/#4e1c3ab64f36

There are 53 comments

  1. Chase M. Hecht

    I really like how this article goes into so much detail. The facts you state, like that 90% of the worlds electronics are made in Shenzhen. I find it very intriguing that Shenzhen used to be a fishing village in the recent past. I think it was very smart of Deng Xiaoping to make Shenzhen financially appealing to factories and manufactures. Shenzhen is now making billions of dollars annually, which helps the Chinese government support itself.

  2. Dillon Jia

    I really like the amount of research that went into putting this article together. You stated both modern and old times in Shenzhen, like how other countries now try to mirror Shenzhen, and the fact that it was a fishing village some time ago. I also find it interesting that production costs are going up in Shenzhen, as companies have had their products made in China as the prices are lower. Shenzhen is making a lot of money thanks to the economic zones that Deng Xiaoping put in.

  3. Wesley Wang

    I’ve always noticed the “Made in China” signs on the back of clothing, toys, etc. But technology wise, a shocking 90% of phones, computer, TV, or any piece of electronics is manufactured in Shenzhen! The phenomenon dubbed as the “Miracle of Shenzhen”, the tiny town of no more than 30,000 turned into a megacity of 11 million people because of the boom in foreign investors. Interestingly, my aunt and uncle actually moved to Shenzhen from Xi’an in search for a better life. They started a car repair company and had huge success. They still run it today.

  4. Joey Liu

    China’s industrialization has brought many changes to rural areas in China. Although I’ve heard of Shenzhen, I never knew that it played such an important role in the manufacturing of popular electronics that we use today. Because the cost of labor in China is low, many technology companies set up factories there. By taking advantage of this, they are able to lower the cost of their products and promote more sales, therefore increasing their profit. Thanks to cities like Shenzhen, China’s GDP is the second in the world, behind the United States.

  5. Jennifer Lin

    I think it’s really surprising how a small city like Shenzhen a few decades ago could so rapidly transform into a metropolis business empire like it is today. This article was very interesting and well researched, and it’s a relevant topic considering we are surrounded by “made in china” items everyday. Like you talked about, SIlicon Valley is not only being outsourced in terms of labor, but it’s also being outcompeted in startups. Shenzhen is a huge global business manufacturing center and also has many small companies trying to make it in China, like the Chinese version of uber. Given Shenzhen’s expeditious growth, I wonder what will be in store for the world in the future.

  6. Meghna Satheesh

    “Made in China” labels are on 97% of the electronics in my house, and it’s great to know where exactly in China it’s made. It’s intriguing to learn how Deng Xiaoping facilitated growth in certain “economic zones” in small cities. It’s almost like laying out blueprints for Wall Street. The only rate of growth that is comparable to the rate of growth in Shenzhen that this article discusses is probably Dubai, which turned from a desert into a bustling city in the blink of an eye. Currently, Shenzhen is a huge economic success for China, and hopefully it will stay that way, even though the future seems uncertain, as this article states.

  7. Douglas Chen

    Amazing! When I used to live in Shanghai and I bought powerbanks and techs from taobao it always said it was shipped from Shenzhen but I didn’t know that an astonishing 90 percent of world consumer electronics are manufactured there. To also learn that the megacity of Shenzhen used to be a rural fishing village was also suprising! The success of Shenzhen is mostly credited to the many foreign investments it gained when it became a special econmic zone. Having low taxes and labor rates,investors flooded into the city turning it into the megacity it is today.

  8. Pratim Chowdhary

    I found this article on Shenzhen extremely informative and interesting. I myself love technology especially phones and computers. It is also very interesting how this small village was able to perform such a transformation over such a short period of time. Maybe it was truly a miracle in Shenzhen but I hope that the other countries integrating the special zone system will also be successful. I am also now interested in the future of Shenzhen and if this economic growth will last.

  9. Derek Zhang

    Shenzhen has risen to become the predominant epicenter of high-tech design and manufacturing in China. Government supported free market economy in major cities such as Shenzhen. As a result, manufacturing costs were low enough to make it cheaper to manufacture there than in the United States. Before Shenzhen was merely a fishing village near the coast. Now Shenzhen is one of the more popular city in China.

  10. Joanne Li

    I’ve always seen the label “Made in China” on products, but I’ve never actually thought about where in China they came from. It was a huge surprise to find out that 90% of the world’s consumer electronics are made in one city! Shenzhen developed from a village of 30,000 people to a city of 11 million, which is even more shocking when I think about the number of people that could have moved there annually. It’ll be very interesting to see how the city adapts to the rise of automation. I hope that Shenzhen’s economic success continues.

  11. Andrew Zheng

    This article presents many key pieces of information that I never knew about. Ever since I was a kid, I would see the “made from china” label on my clothes, technology, and other goods. But it’s amazing to finally know how and where our everyday needs and necessities are made from. It is even more impressive on how a tiny city like Shenzhen can become a megacity where most of the world’s products are made from. I am excited to see what the future has in stores for this once small town.

  12. Michael Pecorara

    Richard, I have confidence with this article that you will make a great addition to the TDC team; your level of writing which included the history of Shenzhen, relating it to the world, and spelling out its future have all contributed to an all-around great article. The article’s topic was also quite interesting. Shenzhen, being modernized during Deng Xiaoping’s reign has clearly brought many benefits to the region, but has it done so at the expense of workers’ dignities? Also, with real estate prices skyrocketing in Shenzhen, my fear is that what once was a quiet village filled with hard workers will now be turned into a playground accessible only by the politically connected. Also, on top of these facts, Shenzhen’s high labor costs could soon mean that Shenzhen is facing economic collapse. Especially in the wake of the aggressive trade war between the US and China, the future of Shenzhen looks grim. The topic of Shenzhen’s future could make an interesting debate topic as well. Thank you for this article!

  13. Andrew Cheung

    I thought this article was very interesting and informative. Technology never ceases to amaze me and it’s quite surprising how Shenzhen evolved from a small, rural fishing village into what is now a technological giant where 90% of the world’s electronics are made in. I think Deng Xiaoping was really clever in setting up several economic zones and making Shenzhen financially appealing with cheap manufacturing prices and taxes. This probably allowed for enough capital to be made in order to transform the small rural village with 30,000 people into bright, flashing megacity with 11 million people. That’s not a small number at all. The phenomenon became known as “The Miracle of Shenzhen”. I hope for Shenzhen’s success to continue and spread towards other countries. However, things don’t look quite well for the continuation of Shenzhen’s success, as labor prices may increase as China’s economy develops which would make manufacturing much more expensive. Anyways, I enjoyed the article and can see that a lot of effort and research was implemented in this article.

  14. Wesley Pergament

    This is so interesting because I have always loved technology! Additionally, I have always wanted to visit China again and now Shenzhen is definitely on the top of my list! It was very smart of Deng Xiaoping to set up different economic zones because without it, Shenzhen would definitely not be the tech capitol that it is today. It is crazy to think that a town of 30,000 people turned into 11 million within a few decades just through the set up of these economic zones. Thank you for sharing!

  15. Leanne Lu

    This article is very in-depth and interesting! I had no idea 90% of consumer electronics are manufactured in one city. It’s fascinating how such a huge and advanced city was only a rural fishing village as recently as 1978. Shenzhen’s population growth from 30,000 people to 11 million is astonishing. It’s sad to think that Shenzhen’s success may not last due to expenses and automation.

  16. mathew liang

    I have known about how Shenzhen is the technology manufacturing capital but I had no idea how significant it actually is. It is weird that the city is so technology centered while neighboring cities feel primitive compared to Shenzhen. It is interesting how they were able to transform into the technology manufacturing capital in such a short time. The fact that 90% of all technology is produced there is crazy.

  17. Hitomi Honda

    Great article, Richard! I learned so much from reading this. Before reading this, I did not know much about this city. Now, I have learned that it not only is the such a large and important technology manufacturing center, I also learned that this small rural town also grew to now have a population greater than New York City! Thanks for sharing and can’t wait to read your next article!

  18. Teran Jafari

    This article is very interesting and low manufacturing costs in China made the economy in China really good

  19. Teran Jafari

    This article is very interesting and low manufacturing costs in China made the economy in China really good. Nice Job.

  20. Adil Kadirov

    this article was really in depth and i saw that the made in china it was very informative and shows our future of china it was really a well done article good job

  21. Ethan Wang

    It’s amazing how a small town could fly up to more than NYC. Even though NYC has been there much longer. It’s amazing how much detail is put in to these articles. I wonder how many items we use come from shenzhen. City’s like these make China one of the richest countries around.

  22. Juliann Lo

    Before reading this article, I had no idea what Shenzhen was or where it was located. I can’t believe that many of the electronic devices that I own have come from Shenzhen. I understand why foreign investors want to have factories in Shenzhen. In order to maximize their profit, they want to keep manufacturing costs as low as possible. I can’t believe more people live in Shenzhen that in New York City. It’s great that the city was able to become a successful economic zone and create jobs for its people. Great article!

  23. Teran Jafari

    I really think this article is one of the best I have read in thedailychina.org. It goes in very detailed and I believed that Deng Xiaoping was really the person that started the economic boom Shenzhen he was very smart in improving relations with other countries by opening encouraging foreign investment, private ownership, and free market forces giving that privilege to other foreign countries. I could not believe that 90% of all electronics would all be produced in Shenzhen China and that it used to be just a rural fishing area. I was shocked that it is more expensive to live in Shenzhen China than many other countries including New York. I hope thedailychina.org comes out with many other articles like this very interesting article.

  24. Derek Chu

    I really enjoyed being able to learn from this article easily. The information is very organized, showing causes and events in a tidy manner. It was also very interesting to learn why so many items are made in China today, however it is sad to think about the future for Shenzhen because as you wrote, automation will definitely destroy the industry. Thank you for such a informative article!

  25. Andy Jiang

    The “Made in China” label is indeed a very common sight on many objects and appliances. I’ve always wondered where exactly in China were such objects being so rapidly made; the article answers just that. The transformation of a rural fishing village to a booming city is simply astonishing. I am surprised to hear of the higher population costs and living expense of Shenzhen; however the spread of economic zones is one strong positive found between the more recent worries and concerns.

  26. Emily Shi

    Shenzhen is definitely a miracle city. Who would’ve known that a rural fishing village would one day transform into China’s third largest city!? I’d say I can’t, but I can believe that a majority of the products hat we we see and use to day are from China. It’s no surprise that 90% of the world’s consumer electronics are made in China, specifically Shenzhen. Because of the city’s economic growth and prosperity, Shenzhen’s manufacturing of electronics would make for another “Golden Age” for Chinese History.

  27. Jeffrey Zhang

    I can’t believe I never heard of Shenzhen! Who could have thought that a rural fishing village transformed into that beautiful metropolitan city that it is today. What I found most surprising is that Shenzhen is comparable to the likes of New York City and San Francisco, perhaps even surpassing them. Furthermore, the fact that it produces 90% of the electrons that we have today is just amazing. But with so much urbanization, are the prices of manufacturing still very low? Or have they risen too high to be considered profitable?

  28. Brian Chu

    Great article! I knew that a large percentage of products in America were made in China, but not 90%! It’s amazing that such a tiny village could be one of the centers of economic prosperity in China. Also interesting to learn that many countries around the world are now trying to “mirror the success” of Shenzhen, by introducing the concept of special economic zones. However, because labor prices in China are increasing, Chinese manufacturing may be more expensive. Regardless of these problems, Shenzhen will be remembered as a success of China.

  29. Justin Kweit

    I never actually asked myself where does my phone come from. I could easily have guessed in China, but i would have no idea where in China. After reading this article I guess my iPhone 7 Plus was made in Shenzhen unless they have other factories in different parts of China. I never knew that Deng Xiaoping was known for setting up those economic zones one of them being Shenzhen. I am sure that if Silicon Valley goes fully automatic Shenzhen will find away to be a major manufacturing hub of the world.

  30. Jeff Bao

    Wow, amazing article Richard! I can’t believe that 90% of the major technologies are made in this city! It’s amazing to see that a city with only a population of 30,000 people turned to a megacity with a population of 11 million people. I’ve seen so many videos about people creating their own smartphones in Shenzhen. It must be because of the vast resources the city offers. Additionally, it’s unbelievable how living in Shenzhen almost rivals that cost of New York City, which is one of the most expensive places to live in. I hope that the issue with the labor problems will be solved because if not, that may be the downfall of Shenzhen.

  31. Justin Lin

    This information is interesting because of the large abundance of importance that this city holds in regarding the production of electronics. I can’t believe that what was once a tiny city in comparison to others manages to impact the world so greatly. You really did an amazing job giving so much detail when writing this article.

  32. Nicholas Yum

    Great article, Richard! I’ve always been really fascinated with technology. In the United States we associate groundbreaking technology with Silicon Valley, but China’s Silicon Valley is Shenzhen. China’s low manufacturing costs makes it the perfect market to produce the world’s technology efficiently. This coupled with China’s robust industrial scene, makes China a major component in the world economy for years to come in this age of technology. Keep up the great work!

  33. Gloria Cheng

    This article was so informative! I never knew how 90% of the world’s consumer electronics are made in China, much less one city. I can’t believe that not too long ago Shenzhen was just a small village. I really hope that the success that manufacturing brought Shenzhen will last. Still, it’s crazy how Shenzhen is a place where real estate prices that surpass those in New York

  34. Michael Kim

    Very interesting article! When I saw most products say “Made in China,” that in itself surprised me. However, now that I learned that 90% of all the technology and stuff are made in this one city, Shenzhen, it’s crazy to think about what it’s like in that city.

  35. Esther Lin

    It’s insane that a city could go from 30,000 to 11,000,000 in the span of just a few decades. It’s crazy to think that 90% of all technology in this world is made in one city alone. This article was so interesting to read and super in-depth. I wonder how much more Shenzhen can accomplish in future years considering it impressive success at the moment.

  36. Jason Mai

    深圳作为中国最发达的几个城市之一,同时结合了中国的传统文化和现代的先进科技,实则不亏于设计之都的称号

  37. Eric Wang

    Wow, I find this article very interesting and amusing. Great job! This article also taught me a lot because before I read this, I never knew that Deng Xiaoping was the person who took power in the People’s Republic of China in 1978 and turned China toward a path of opening up to the rest of the world. And I find that where a tiny town of no more than 30,000 turned into a megacity of 11 million people – more than New York City. very hard to believe and also proud because Chinese people can do so many great things! And that after reading this article, I will definitely go visit this amazing city Shenzhen whenever I have the chance.

  38. Grace Zhang

    Interesting article! Although I knew that Shenzhen being the capital of manufacturing, your article had a lot of additional information that made me want to read more. It’s hard to believe that a town with such a low population turned into something so big and significant. I learned so many new things from reading. Thank you for writing this!

  39. Jake Moreh

    Very informative article. I’ve never even heard of Shenzhen prior to reading this article. It’s crazy to hear that up to 90% of American goods are manufactured in China. It is hard to believe that such a small town turned around to make such a big difference in the world of manufactured goods. Only 30,000 people lived there, and there are now 11 million people.

  40. Steven Yu

    As a major consumer of technology, I cannot believe that half of the tech that I buy is made in 1 province of China. I think Deng XiaoPing is one of the greatest leaders in China as it made a complete 180 in declaring China as a major foreign power. One of the greatest powers in the 21st century is China, and they will definitely surpass many other countries within the decade.

  41. Austin Kweit

    I have known about how Shenzhen is the technology manufacturing capital but I had no idea how significant it actually is. It is weird that the city is so technology centered while neighboring cities feel primitive compared to Shenzhen. It is interesting how they were able to transform into the technology manufacturing capital in such a short time. The fact that 90% of all technology is produced there is crazy.

  42. Dylan Swickle

    Thanks so much for writing this article, Richard! I found it very interesting how at first, this village was just a simply fishing village, and how within time, it developed into the leading producers of so many devices that everyone takes great advantage of. As I looked at the picture that was posted along with the article, it makes seriously wonder how that land could have ever looked like a quaint fishing village considering its huge skyscrapers and vibrant colored lights. Furthermore, it is crazy how one of the main reasons that technology started to be developed in Shenzhen was because the taxes there were cheaper, thus making it cheaper for American investment. When I studied at Yale University over the summer, I had met many other students from Shenzhen who had told me about their city being a sort of “technology capital” of the world, and I found that really unremarkable. However, it is sad to see that this increasing capital that had been benefitting Shenzhen for such a long time might just start hurting them; it should be interesting to see what happens throughout the years and how the evolve as a leading technological based city in the world.

  43. Eric Wang

    I’ve always been very intersted in this one of the most important and advanced cities in China, Shenzhen. I have personally been there a few times myself, all I can identify the city is how much people could spend there because it’s such a crowded city with beatiful city views. But I never knew that Shenzhen is where the taxes and manufacturing costs were low enough to make it cheaper to manufacture there than in the United States. Also, I agree that China’s economy develops from manufacturing, labor prices become higher and higher, ironically making Chinese manufacturing more expensive. Because nowadays, the prices for manufactured good in China had skyrocketed comparing to the old days. Thanks so much for writing this article! It really taught me a lot!

  44. Helen Zhang

    This was a very informative article, and I really enjoyed it. I learned a lot form this article. I never knew that 90% of world’s consumer electronics were made in Shenzhen. Before reading this article, I knew nothing about Shenzhen. Technology is all around us today, and I feel that it is really important to learn where all these technology comes from. Thanks for sharing this article!!!

  45. Herin Ahn

    Before reading this article, I knew nothing about Shenzhen. I’ve heard about it once or twice when I was doing a research on China, but never really knew what city it was and what it was famous for. I was very surprised by the fact that 90% of the world’s consumer electronics were made right in Shenzhen, China! Although it was amazing to see how much the city has evolved and how big of a megapolis it had become, I was worried about the environment and the smog it was producing while manufacturing. That smog and unhealthy leftovers will circle around the world and make everyone in the world suffer. Recently, China’s neighboring country, Korea has been suffering greatly because of the smog that came from China. Looking at that, I was kinda disappointed at Chinese manufacturers. It’s good that a lot of Chinese cities are very great manufacturing cities and all, but I think it should have more strict regulations that can reduce pollution level.

  46. Lucy Cao

    深圳真的是超级发达的城市之一在中国。但真的很厉害啊从一个小到不起眼的小村庄变成了如今中国的“硅谷”,仅次于北京和上海。真的是发展迅速了。从图片当中也能看到如今的深圳是多么的繁华。也逐渐对外开放走向世界。是真的很厉害了,有机会一定要再去深圳看看去。这篇文章呢也教会了我许多

  47. Blake Mayourian

    This article was extremely informative, and I learned a lot about electronic manufacturing. One fun fact I have learned is that 90% of electronics are made in Shenzhen. Deng Xiaoping was a very intelligent man who had an eye for the future. This man turned China toward a path of opening up to the rest of the world. One reason why Shenzhen is the major manufacturing places is because of the low taxes and low cost to manufacture things. Many other countries are striving to do the same as Shenzhen. The other countries desire to be main manufacturers for large companies.

  48. Renee Lin

    This article is amazing regarding how much detail it yields. It has statistics when the author could have easily published the article without it. I had always knew china was the heart of manufacturing in the twenty first century but I didn’t know so much of it was based in se chuan. Overall a great article and I hope this author can put more of his great work up.

  49. Ria Bhasin

    This was such an interesting article. I now know that Shenzhen is the third largest country in China and has 11 million people that live there. Shenzhen is one of the biggest manufacturing places because of low wages and low costs to develop items. Prices have started to go up which means China’s production can start to decrease. Before reading this article I had never heard of Shenzhen now I know so much about it.

  50. michael lin

    China’s industrialization has brought many changes to rural areas in China. Although I’ve heard of Shenzhen, I never knew that it played such an essential role in the manufacturing of popular electronics that we use today. Because the cost of labor in China is low, many technology companies set up factories there. By taking advantage of this, they can lower the cost of their products and promote more sales, therefore increasing their profit. Thanks to cities like Shenzhen, China’s GDP is the second in the world, behind the United States.

  51. Peter Ochalek

    I never knew that so much of the world’s electronics were manufactured in Shenzhen! Now I wonder how Shengzen came to be the tech manufacturing capital of the world because that seems like it’s difficult to accomplish. On the other hand, I would love to try and speculate the effects of China’s rising labor prices on Shenzhen’s GDP, as it will clearly have strong effects. If there was one thing I wish this article would mention is which cities have been successful in replicating the success of Shenzhen.

  52. Catherine L

    Great article. This taught me a lot about where consumer electronics are manufactured. It is surprising that 90% come from this city alone. It will be interesting to see if their growth continues to last, and whether real estate prices there will maintain these prices. China’s technological advancements will definitely allow them to surpass America within a few decades.

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