The artist's concept of the Guangzhou Knowledge City

A new city is in the making on the eastern outskirts of Guangzhou. In lieu of the average citizen, the city will be home to thousands of biotech engineers or new energy researchers. It will be a green city. It will be a hi-tech city. It will be a city of the future.

Just a 30-minute drive from the downtown area of the Guangdong provincial capital, the project, now known as the Knowledge City, will cover roughly 123 square km in Luogang District. It will feature state-of-the-art infrastructure and public facilities to attract domestic and international talents in emerging industries to forge Guangdong's future.

The project, a joint venture between Guangzhou and Singapore, marks Singapore's third investment in a Chinese city-development project, aside from Suzhou Industrial Park in Jiangsu Province and Tianjin Eco City.

Singbridge International, a subsidiary of Singapore's sovereign fund company Temasek Holdings Ltd., is expected to pour 2 billion yuan ($298.5 million) into the 50-50 joint venture with the Guangzhou Development District (GDD).

Both sides have pledged to forge a capacity-building platform for advanced services and avant-garde innovation, taking full advantage of Guangdong's R&D, production and marketing strengths and Singapore's city planning, branding and management capabilities.

"The project offers us an opportunity to learn more about each other," said Singapore's Senior Minister Goh Chok Tong at the ground-breaking ceremony on June 30. "China's direction in the next 10-15 years may serve as a model for Singapore to follow."

A total of 33 contracts were signed at the ground breaking: 17 of the businesses were from Singapore and 16 from China.

Strong enough magnet?

Behind the scenes, both Guangdong and Singapore face the difficulties of pursuing sustainable social and economic development.

Singapore must deal with a limited market—its territory stands at less than 10 percent of Guangzhou's; and Guangdong Province, China's largest economic powerhouse for the past three decades, has been trying hard to upgrade its manufacturing industry to reorient its economy toward a more balanced, energy-efficient and eco-friendly development.

Guangdong's Party Secretary Wang Yang brought up the idea of a joint development project when he visited the Southeast Asian country in September 2008.

The idea came to fruition in March 2009 when the Guangzhou Municipal Government contracted Keppel Corp. Ltd, a Singapore-based investment holding and management company, to conduct a feasibility study for the project. Keppel has invested in Singapore's previous two projects in Suzhou and Tianjin. Singbridge acquired the project in September 2009.

In addition to economic returns, the project will help market Singapore's expertise in public services and management.

Backed by Singapore's city planning expertise, the Knowledge City is expected to become the ideal destination for innovative startups, as well as one of the world's most livable and vibrant cities for young professionals.

"I hope the city can at least match Singapore in terms of environmental comfort—that is, transportation, air quality, green coverage and infrastructure. But I think it will even have the potential to exceed Singapore, given Guangzhou's geographic advantages," said Liu Thai-Ker, the project's blueprint designer and Director of RSP Architects Planners and Engineers (Pte) Ltd.

But as a growing number of cities are developing their own innovation incubators, the Knowledge City in Guangzhou will find it increasingly difficult to attract talent.

"Only those cities which can entice talent will have a future. If we want to forge a brand like Silicon Valley, we'll need to target the right knowledge and creativity," said Goh.

Patience makes perfect

Like the previous two projects, the Guangzhou project won't yield returns on investment in the short term. Construction on the 10-square-km take-off area, for example, will not be complete for three to five years.

Only Government of Singapore Investment Corp. and Temasek Holdings, which manage Singapore's huge sovereign wealth—now worth more than $400 billion—are capable of managing the risk in the Guangzhou project over a term as long as 20 years.

That's why Keppel, a public company, sold its stake in the project to Singbridge, Goh said.

"It's not a 100-meter race, nor a marathon," Goh said. "We and our Guangzhou partner will strike a balance and look for a sustainable development pace, doing our best to make it a model for all Chinese and overseas cities."

And Guangzhou is striving to win more preferential policies for the project. Already, the Singaporean Government has designated two ministers to coordinate government efforts.