Apple, Huawei, Tencent... Why Big Tech Is Moving to Guizhou, China

Guizhou Province in southwestern China, once considered the poorest 'chon (village)' in the country, has recently begun to rapidly grow into the heart of big tech (large information technology companies), despite being a remote mountainous area that had little to offer except the famous Baijiu brand 'Maotai' just over a decade ago.

Leading the national-level Chinese project 'Dongshu Xisuan (Eastern Data, Western Computing),' which involves bringing data from the eastern regions to be processed in the west, Guizhou is steadily accumulating the 'big data' that serves as the rice for big tech. Following telecommunications giants Huawei, Tencent, China Mobile, China Telecom, and China Unicom, global companies such as the American Apple have also responded to this project. How did Guizhou, once a typical rural village, grow into a big data valley?

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As of the first half of this year, Guizhou's Gross Domestic Product (GDP) reached 1.0738 trillion yuan (approximately 207.1252 trillion KRW), achieving a 5.3% growth compared to the previous year, significantly surpassing the national average growth rate of 5.0%. While most of the top provinces by economic scale saw a slowdown in growth in the first half of this year, Guizhou's growth rate rose compared to last year's 4.9%, drawing attention.

At the center of this growth is the big data industry. China's big data industry is expected to grow to nearly 464 trillion KRW this year. According to the '2024?2029 China Big Data Center Construction and Development Outlook Research Report' published by the China Commercial Industry Research Institute, China's big data industry size is projected to reach 2.4 trillion yuan this year, a 26.3% increase from last year's 1.9 trillion yuan. This figure significantly exceeds the growth rates of 18.0% in 2022 and 21.0% last year.

In fact, it is no exaggeration to say that Guizhou's transformation into a big data valley is a 'decision of nature.' The region's low and stable average annual temperature of 23 degrees Celsius and its climate, which rarely experiences natural disasters such as earthquakes or floods, enable natural cooling and stable data storage. Another advantage is the abundance of power resources, including fossil fuels like coal and new energy sources such as solar and wind power, which make electricity costs low. Guizhou's electricity price is about 0.45 yuan per kilowatt-hour, nearly 20% cheaper than the national average of 0.55 yuan.

A view of Tencent's data center located in the Gui'an New Area of Guizhou Province, China, photographed last August. The cave-like structure facilitates equipment cooling, taking advantage of the local terrain. (Photo by Xinhua News Agency)

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Luo Wei, Deputy Director of the Guizhou Foreign Affairs Office (Photo by Kim Hyun-jung)

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When visiting Guizhou Province on the 25th of last month, the temperature was a cool 20 degrees Celsius, neither hot nor cold. It is difficult to experience the scorching heat of midsummer or the severe cold of midwinter here. Luo Yu, Deputy Director of the Guizhou Foreign Affairs Office, explained, "Thanks to the region's unique karst terrain (which accounts for 73.8% of the total area) and the cool, stable climate with few natural disasters, it was possible to rapidly grow into a big data valley." He added, "We provide tax reductions on electricity and water bills to companies located in the valley, which is a significant advantage for companies with many server devices."

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According to local officials, the big data industry is playing a role not only in big tech but also in addressing regional development imbalances, such as in medical services. Across China, online medical consultations are possible through a system developed by the Chinese Langma Group, with the related disease information servers located right here in Guizhou. A representative from the Big Data Exhibition Hall in Guiyang stated, "The number of consultations has exceeded 11.54 million, and there have been about 29,700 cases of collaborative diagnosis. Disease information for over 360 million patients is stored on the servers, and the cloud is operated and securely managed by the government." Additionally, regional tourism is also being digitized for management and used in course and service provision.

Among Korean companies, Hyundai Motor Company is the only one to have opened a big data center here. However, the servers have not yet been relocated from Beijing, and the center's scale is still small, so it is difficult to say that it is operating in full scale.

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