Shenzhen: The City of the Future Leading Global Growth in Millionaires

Shenzhen also known as 'China's Silicon Valley' has seen a 140% increase in the number of millionaires Henley & Partners reports

by Sededin Dedovic
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Shenzhen: The City of the Future Leading Global Growth in Millionaires
© World in 4K / YOutube channel

In New York, nearly 350,000 millionaires live, which is more than in any other city, representing an increase of over 48% over the past decade, according to the global ranking of wealthiest cities compiled by the immigration consultancy firm Henley & Partners.

However, one city in China has seen a significant increase in the number of millionaires. Shenzhen has experienced a 140% growth in the number of millionaires, according to a report by New World Wealth and migration investment advisor Henley & Partners, as reported by CNBC.

The growth is far greater than in other first-tier cities in China, including Beijing and Shanghai, whose millionaire populations increased by 90% and 84%, respectively. In 2023 alone, Shenzhen saw a 10% increase in millionaires, while Beijing and Shanghai experienced a decline of around 5% amid an exodus of wealthy individuals from China.

"Overall, the number of millionaires in China declined by 3% in 2023, so Shenzhen significantly outperformed the country as a whole in 2023," said Andrew Amoils, an analyst at New World Wealth, to CNBC. The majority of this increase in millionaires in Shenzhen is due to new businesses and organic income growth within the city, while around 30% of the growth is attributed to an influx from cities such as Beijing, Shanghai, and Hong Kong, according to Amoils.

It is expected that Shenzhen, also known as China's Silicon Valley, will continue to grow "very strongly" until 2040, compared to Beijing and Shanghai, which will likely experience moderate growth, Amoils added.

The Huawei logo is seen on the side of the main building at the companys production campus on Shenzhen,© Kevin Frayer / Getty Images

This comes against the backdrop of a struggling Chinese economy in recent years, particularly in the faltering real estate sector.

Shenzhen's economy grew by 6% in 2023, surpassing the growth in Beijing and Shanghai. The Chinese city of Hangzhou ranked second in millionaire growth with 125%, while the Indian city of Bengaluru and Austin, USA, ranked third and fourth; Guangzhou, China, ranked fifth, according to Amoils speaking to CNBC.

"For the last three decades, what has set Shenzhen apart from other first-tier cities is its relatively easy governance and its welcoming attitude towards migrants," said Erica Tay, director of macro research at Maybank.

Just 40 years ago, Shenzhen was a collection of poor fishing villages across from Hong Kong with a population of around 30,000, and today it is a modern metropolis of 13 million people and a hub of China's high-tech industry.

With all its districts combined, this metropolis is estimated to have nearly 17 million inhabitants. Compared to Shanghai, which draws its economic strength from state-owned enterprises, Shenzhen's corporate landscape is dominated by entrepreneurs from the private sector, she added.

Shenzhen, besides being a hotspot for startups, is also the home city of global tech giants such as Tencent, Huawei, and BYD. "The regulatory environment favorable to business and innovation has forged wave after wave of wealth that you've seen [in Shenzhen] yourself," Tay said.

The metropolis was declared one of China's first special economic zones in 1980, opening the city to foreign investment, technology, and market-oriented reforms. Its proximity to Hong Kong, which is inherently business-friendly and efficient, also helped Shenzhen learn how to develop its economy, said Zhiwei Zhang, chief economist at Pinpoint Asset Management.

Shenzhen© World in 4K / YOutube channel

Hundreds of sensor-equipped robotaxis cruise the dense central business district of the southern Chinese tech hub of Shenzhen, hinting that the era of driverless cars could arrive sooner than predicted, especially in China, which is taking the lead in the industry from the US.

While the United States was thought to have taken the lead in testing autonomous vehicle (AV) technology, in the Chinese city of Shenzhen, this industry is rapidly accelerating, with trial robotaxis becoming a common sight.

Shenzhen aims for its smart vehicle industry to reach revenues of 200 billion yuan by 2025. When Chinese leader Deng Xiaoping decided in 1979 that Shenzhen would be the first special economic zone where foreign companies could invest under better conditions, it was the first test for his policy of reform and opening up.

Engineers and workers from all over China came and built the megalopolis in record time. Shenzhen is home to the world's fourth tallest skyscraper - the 115-story, 599-meter-high Ping An Finance Center, and the concept of "Shenzhen speed" is further exemplified by the fact that at one stage, it took just four days to build one floor.

It can be said that Shenzhen is the mobile phone manufacturing capital of the world. According to some estimates, every other mobile phone in the world is made in Shenzhen. Over a billion mobile phones leave this megalopolis every year.

Shenzhen is definitely the city of the future, and analysts predict that this year there will be a record number of millionaires in this city.

Silicon Valley
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