A glimpse of China’s third-tier cities

A 1200km trip in three days from Ningbo to Nanjing, Huia’an, Huzhou, and finally Shanghai bears no comparison to the Long March despite what my back is telling me, but it gave me a tantalizing glimpse of how China’s third-tier cities are being developed.

To say I was impressed would be an understatement. The great highway and high-speed train infrastructure that China’s built over the last two decades has made these cities much better connected than at any time in their history. This has not only made them more attractive investment locations for companies looking to move their operations inland away from the more expensive coastal areas, but also provided regional and local governments with the impetus to make major investments in boosting the housing stock, enhancing cultural and recreational amenities, and driving the creation of new industries in emerging technologies such as electric vehicles, renewable energy, and biotech.

China factory automation

As we drove around these cities, the results were very clear to see in the form of massive new apartment complexes, sprawling industrial estates, and shiny new office buildings all connected by an extensive network of multi-lane roads future-proofed for the integration of new technologies like 5G. Oh, and last but certainly not least, plenty of parks and other green spaces as well as thousands of trees between them.

The lessons that China learned from building up the infrastructure of its coastal areas are thus now being applied to its inland regions. The major differences are that the process is now being implemented at a faster speed and with a much stronger focus on the development of domestic industries based on new technologies rather than on providing efficient, low-cost manufacturing facilities primarily for overseas companies and markets.

Watch out for a new wave of innovation emerging from China’s lesser-known hinterland cities. Now that the foundations have been put in place, it’s only a matter of time before it hits global markets.

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