Greater Bay Area's Research Investment Lags Behind National and Global Averages

The Guangdong-Hong Kong-Macau Greater Bay Area (GBA) is currently trailing behind both China's national average and global benchmarks in basic research investment. According to a report by Deloitte, the GBA, which includes cities like Shenzhen, Hong Kong, and Macau, allocated approximately 28.9 billion yuan (US$4.2 billion) to basic research in 2024. This expenditure represents only 5.67% of the total research and development (R&D) spending in the region. In contrast, the national average for China stands at 6.9%, while countries such as the United States and South Korea report significantly higher figures of 14.5% and nearly 15%, respectively.

South China Morning Post

Polly Lee, the China deputy audit and assurance leader at Deloitte, emphasized that the GBA's innovation landscape is predominantly application-driven. Investment in research tends to increase only when clear use cases are identified, leading to a relative weakness in basic science and original innovation. The GBA has established itself as a critical technology hub in China, with Shenzhen often referred to as the country's "Silicon Valley." The region hosts major firms like Huawei Technologies, Tencent Holdings, DJI, and BYD, creating a robust ecosystem that spans hardware, software, and advanced manufacturing.

South China Morning Post

The disparity in basic research investment raises concerns about the GBA's long-term competitiveness in the global technology landscape. As the region continues to develop its capabilities in sectors such as semiconductors and smart manufacturing, the need for a stronger foundation in basic research becomes increasingly apparent. Without significant improvements in this area, the GBA may struggle to maintain its status as a leading technology hub.

South China Morning Post

Critics argue that the GBA's focus on application-driven innovation may hinder its potential for groundbreaking discoveries. The reliance on immediate use cases could stifle creativity and limit the region's ability to contribute to fundamental scientific advancements. This perspective highlights the necessity for a balanced approach that equally prioritizes both applied and basic research.

South China Morning Post

While Deloitte's findings present a clear picture of the GBA's current research investment landscape, there is a lack of comprehensive data comparing the effectiveness of research outcomes in the GBA versus other regions. Further analysis is needed to understand the implications of these investment levels on the GBA's innovation capabilities.

South China Morning Post

• “Innovation in the GBA remains largely application-driven, with investment ramping up only when there are clear use cases, while basic science and original innovation remain relatively weak,” — Polly Lee, China Deputy Audit and Assurance Leader, Deloitte.

South China Morning Post