This is Roundtable.
Imagine a small county in China quietly reshaping a global luxury.
In one county in particular, lab-grown diamonds are produced for a fraction of the traditional cost.
It's just one example, but it's a glimpse into how China's local economies are now driving global markets.
What does the rise of these industrial counties mean for the future of global manufacturing and consumption?
We'll discuss.
We're live from our studios in Beijing.
This is Roundtable.
I'm Steve.
Thank you very much for sharing your time with us today.
And for the show, I'm with Fei-Fei and Yushan.
First up.
A customized one-carat lab-grown diamond can now be yours for roughly 7,000 yuan.
That's about 950, and that is a great deal because it's a mere fraction, just a tenth, as a matter of fact, of the price of a natural stone.
There's a high chance that that diamond originated in a single county in China in Henan province.
Known as China's diamond capital, it produces over 60% of the nation's synthetic stones.
But this is about more than just a sparkle and a value.
This story from this county reveals a powerful economic narrative.
Counties, just like it, are leveraging local resources and talent to build global-scale industries, creating vital links between rural areas and urban markets while driving a demand both at home and abroad.
So what does the rise of such specialized industrial powerhouses mean for China's economic future and its role in the world?
And what is this evolving role of small counties in shaping the national and global economic landscape?
Let's start with that county in particular.
Am I saying this correctly?
Zhecheng.
Zhecheng County.
Yeah, it sounds very correctly, actually, Steve.
Yeah, Fei-Fei and Yishan, good afternoon.
Let's start there, as a matter of fact.
I didn't know that there was a county in China that had such a big responsibility in terms of producing these stones.
Me neither, but I just looked it up a little bit.
They have this technology called high temperature, high pressure, which can sort of mimic an original diamond in the timeframe of within two weeks.
And of course, the price is much lower.
And that's what they're doing in Zhejiang.
You can't imagine all that happening in the county.
Exactly.
And also, the county used to be a national registered sort of poor county back in a few decades ago.
And now, like Steve said, it's responsible for more than half of the country's synthetic diamonds production and also supplies globally.
And the story of Zhecheng is quite, I think, symbolic in Chinese terms, because Zhecheng originally, what didn't you know?
Had the technology about you know, breeding these synthetic stones.
But as China was trying to reform and opening up in the 1980s and some of the engineers who had the technological know-how returned to the county of Zhejiang and started their own I would say workshops, family-run workshops to produce.
But at that time, they would only be able to produce macro powder of those diamonds.
So there's just powder, which is one of the materials you need for diamonds, like the stones.
And they stayed pretty much on the lower end of the value chain for about one or two decades.
And then the county realized, you know, we can't just always be producing the materials for the world.
Because at that point, the county accounted for over 70% of China's diamond micro powder market.
But only the powder.
Only the powder.
They were called the hometown of the micro powder, diamond micro powder in China.
But they didn't want to be known as the powder capital.
No, they want to be known as more.
So that's why the county government start to attract talents and also businesses in synthetic diamonds back to the county.
And then they started to grab the, you know, technological know-hows, like Yushan just said about the pressing machines, the pressing technologies to make those powders.
As diamonds, as stones.
And then they set up an industrial park giving out, you know preferential policies, you know tax reductions, sort of starting to shift the industry from you know family run workshops to actual, you know businesses, companies and factories.
A technology-intensive industry.
Exactly, exactly.
And then later, entering 2010, they were able to produce large, gem-grade cultured diamonds that can be used on jewelry.
Like maybe a piece of your jewelry that you're wearing at the moment.
Some of the human-made stones are actually produced in this county.
Yeah, they're actually exporting it to outside of China too because right now Zhecheng...
The county produces over 60 of the country's synthetic diamonds, and that accounts for nearly half of the world's supply as of 2025's report.
When we say county and I know all the counties across China will have different populations, but we're not talking megacities here.
We're talking rural areas with a population of maybe I don't know a couple of hundred thousand 300 400000, generally speaking.
That can vary depending on the regions.
But the county, the administrative level of a county is sort of in between a village and a city.
Okay, yeah, so somewhere halfway in between.
Yes.
This county is just one example, and it's a very good example, which is why we wanted to talk about it first, but it's just one example that reflects a bigger transformation in these county-level economies.
That's so true.
The numbers just show that this is a structural kind of development here in china.
Not a single anecdotal case because, according to 2025 report analyzing the high quality development of china's county economy from xinhua news agency, that china now has 62 counties with a gdp of over 100 billion yuan, and another 21 counties are just below that threshold, and over 100 counties now.
They have GDPs above 800 billion yuan.
And what's striking here is the diversity of all of these counties working on their own pillar industry locally and kind of thrive through that.
And one example would be Kunshan in eastern China's Jiangsu province that's taking advantage of its local nearby major city Shanghai.
So Kunshan has developed a clustered, coordinated ecosystem locally.
That's kind of sitting back to back with Shanghai, but still on its own.
So Kunshan's main pillar industry ever since the 1980s has been electronic technology, but it has already undergone a remarkable transformation ever since then, from what was once it was once Suzhou's weakest agricultural based county into one of China's nowadays strongest county county level, city to be more exact.
So that's sort of bigger in the scale than other counties but close up to the city but it's still not big enough to be a city.
So its own economic scale now far outpaces peers at the same administrative level.
And what I personally found really interesting is that it has also grown into an international hub for the coffee industry.
Oh, cool.
You see, Kunshan doesn't produce coffee beans.
It's far from being hot and warm enough to have the beans.
So how do they do it?
So what they do is that they build out the whole value chain from green coffee bean trading and distribution to platform-based transactions, the RD and roasting technology and stuff like that, and also brand sales.
So now Kunshan has quietly put together such a relatively complete coffee industry ecosystem without having to produce the beans themselves in just the recent years.
And it is now handling 60 percent of China's coffee bean imports and roasting.
They're handling the business side of things rather than the bean production.
That's really smart, because we talked about Yunnan in southern China, where they produce coffee, they roast, they do r?
D, they create their own brand and they sell to all the other regions in china and export too.
But what kunshan does is they utilize what?
Um they get from other provinces and they or even other countries and they kind of put an innovation on how they can market it better.
So that's something really smart too, really cool.
Geographic location within the country is an advantage for some of these counties and they do take advantage of that.
You talk about the proximity of Kunshan to Shanghai, but also Guangdong takes advantage of their geography too.
Yes, for Guangdong, a lot of those counties are sort of ports and key transportation routes.
So they are taking advantage of these coastal leverages that they have to be better integrated into global value and industrial chains.
For example, Chenghai District in Shantou City is now widely recognized as the world's leading toy manufacturing hub, producing about one third of the global toy output.
That'd be a great place for a kid to grow up.
The toy capital of the world.
Cheaper toys.
And also surprisingly, that district holds the most complete and largest toy industry cluster.
They are exporting to more than 120 countries worldwide.
So check out your toy collections.
Some of them, most of them actually come from these small, these Chenghai districts.
Yeah, that area ranks number one in China in terms of toy brands, IP licenses, patent authorization.
And it has really earned the reputation as the toy and gift capital of the world.
That must be a fun place to visit.
It must be so toy inspired, all the things around the town.
They have expo in Guangdong province where a lot of toy brands from in and outside of China attend every year.
I don't remember the name of it.
Guangzhou Hui.
The Canton Fire.
The Canton Fire.
Yeah.
Cool.
That's a toy example.
Then you've got your industrial examples too.
Yeah.
Exactly.
I think different counties have their advantages.
For example, I think in Mongolia they have this administrative level called banner, which is pretty on par with county level.
And their Junger banner focuses on building new energy clusters, new energy industries in that region.
Simply because you know, that banner used to be a coal mine town.
So but now apparently, as China is going you know green development and all that They are also taking advantage of the vast land area that they have in Mongolia, with the grasslands and deserts that they have.
They're developing, for example, solar farms, wind farms as well, and now taking advantage of that base.
They're sort of also building new technologies like power storage systems, trialing these new technologies within those solar farms and wind farms, or a more niche technology at the moment called hydrogen.
I haven't been to Inner Mongolia myself, but I've seen photos and videos of co-workers who have traveled there on vacation.
And it's almost mind-blowing to see.
It's so gorgeous.
And the lands look... so vast, the sky looks like it never ends.
It just keeps going and going, and the green grass fields keep going and going and going.
So that county you just spoke of would be an example of a place that built its name on coal, historically speaking, but now would have to reimagine itself and redesign itself.
And now, instead of taking advantage of what was coal, which was an advantage for that area on the planet, they now take advantage of something different.
Yeah, sun, wind, because Inner Mongolia is also very famous for their wind and gale weathers.
So they were able to develop solar and wind farms.
And I think more interestingly, they are testing zero carbon coal mines in that banner as well.
Because when it comes to coal mines, there are still workers that depend on these mines.
So we can't just be simply shutting it down altogether.
That's one of the challenges of the transitions to green energy.
Yes.
So now they're asking the question can we make coal mines?
You know their carbon emissions to be cut down to net zero.
And so they are testing out this new concept Because they have the new energy supplies, the new power.
They have experts in industries who know their advantages and want to take advantage of that.
For example, the vast land areas and the wind and sun power.
Agriculture would be another area where certain counties are excelling.
That's when we mentioned this county named Shouguang in eastern China's Shandong province.
So this is a place that cracked what used to be a classic northern Chinese problem.
That is, how do you farm fresh vegetables through the freezing winters?
And the answer of that is greenhouse.
But it's not the normal traditional greenhouse.
The people in Shouguang, they actually went in all on the technological side.
And standardization as well.
There's smart systems, the mobile controls and high tech monitoring.
That all turned vegetable farming into a data driven industry, locally speaking.
So at the same time, it built out this full industrial chain from seed breeding and cultivation to logistics, wholesale markets and exports.
So the results speak of themselves. there are 277 new vegetable varieties there.
And they produced the produce shipped to more than 200 cities across China.
And the exports reaching over 40 countries nowadays.
That's how Shandong people use, you know, their wisdom to kind of modify the natural environment to their benefits.
And also, I think, for people coming out from this county called Shouguang.
There are sort of the backbones of a lot of the vegetable industry here in China.
I think when we visited Shizang there is also a businessman coming from Shouguang that is also trying to grow vegetables on Shizang in Rikaza.
So he's trying to learn how to adapt to the high altitude environment and also build greenhouses and testing out what kind of vegetables can be grown here and how to alter the temperatures and technologies so that these vegetables can thrive.
And AI.
I've watched numerous videos on that.
I was just kind of enthralled by the topic.
Hop online if you haven't seen any of these videos before, how AI is incorporated into agriculture.
It's done in many different ways but, particularly in the case of the greenhouses, temperature control, perfect watering in terms of timing and amount.
I mean, the list is long in terms of how farming has kind of transformed into the modern day.
But it just makes things ultra, ultra, ultra efficient as well.
There's very little waste when they can incorporate AI into their production.
Exactly.
And I also think before AI arrived, I think when we talked with that Shogun businessman in Rikazo, he told me that when he was trying to grow tomatoes they have to test the temperature one degree by one degree.
Yeah. that they raise somehow by two degrees, the tomatoes won't grow.
I was going to say, I'm surprised it's one degree to one degree, not one to 1.1 degrees.
Oh, wow.
Yeah, so maybe taking advantage of technologies like AI they don't have to be that effort with a lot of efforts thing.
The AI does the work for them.
Some counties, too, take advantage of their local identities.
And some of these counties, their populations are, are familiar to me because these are the population numbers that I might find in Nova Scotia, where I'm from.
Really?
I think you're speaking about the population of Jiuzhaigou County in southwest China, Sichuan Province, exactly.
So they have a population of just 67,000.
That's roughly the same as Nova Scotia?
Well, Nova Scotia's population is about 200,000 or 300,000, I think.
But my hometown is like 1,000 people.
I see.
So this county we just spoken of...
It's the name that people mention when you think about cultural and cultural tourism, because it's so famous in China throughout the decades.
I've heard about it ever since I was a child.
So it was turned its world famous scenery into a hundred billion yuan tourism economy.
That's about 14.2 billion U.S. dollars. worthy nowadays.
And that success rests on three main pillars.
First of all, they have the strict ecosystem protection mechanism.
That's the scenery comes first idea.
Secondly, they have better connectivity.
They kind of build this as part of the mindset in developing this whole region with high-speed rail and smoother local transport that's linking all the different sites.
That makes the area far more accessible nowadays.
And thirdly, the shift in tourism itself is happening over the years as well.
They move beyond quick photo stops to just the longer, more sustainable and richer stays for everyone who comes for a visit.
So this place, I remember having to visit it maybe years ago when I was a kid.
And I remember just people taking pictures all the time of the scenery and themselves with the scenery.
But apparently nowadays they're trying to transform it that into a whole immersive eco-friendly experience for you to be there instead of just taking pictures at certain spots.
It's kind of the same concept as the diamond producing county, in the sense that The diamond producing county had the powder, but they thought we can do more here.
We can be a bigger version of ourselves.
This county, okay, people are stopping to take pictures and stuff, but they're leaving too fast.
Yeah, exactly.
Sort of, you know, very quick sightseeing.
So how can we develop more to make them stay longer?
Yeah, so for this region in Sichuan province, it actually has a lot of very diverse cultures.
For example, a lot of ethnic groups living here.
We have the Tibetan people, we have the Han, we have other ethnic groups living here.
They can offer experiences and you know festivals, sports and other other cultural activities, so that you know tourism are just not here to snap some photos taking advantage of the beautiful lakes and forests in the background, but it can also, you know, experience what the local cultures can offer.
By the way, I owe the citizens of Nova Scotia an apology.
I just looked it up.
Over a million people in Nova Scotia.
Where did they come from?
Congrats.
I've been away for a long time, apparently.
That's a big city.
I got some new neighbors that I've never met before.
All right, so back to China.
Plenty of examples that we just talked about there.
But what does it mean for the country when you have so many booming, successful counties?
Well, economically it matters significantly because over half of China's population lives in these counties and they are responsible for nearly 40 of the GDP.
So county-level economy is really quite important to China's overall economic landscape.
Yeah, because we gave examples of individual counties operating...
But when you group them together, they make up a significant portion of the country's GDP.
Yeah, exactly.
And also there are the potential for future development in consumption, in innovation, in terms of tourism growth.
As we think about samples, we give out.
Some of them can be very high tech.
Some of them can still have potentials in digging out their culture and tourism potentials.
So when we are talking about this county level economy, they matter greatly for China's economy.
But more to that is that, as we mentioned, county is sort of the link, the bridge between bigger cities like Shanghai and villages.
Yeah, now it is.
Now they are.
Historically these counties would have operated independently and kind of lived amongst themselves without any coordination with other counties.
Because I've learned through Roundtable that That, historically speaking, in China, you know, the terrain would make it almost impossible for people to reach one area to another area, or just the logistics were just impossible.
But now, with the country becoming more connected than it ever has before, then the opportunities to take advantage of relationships between counties or between rural and urban areas is now really significant.
Yeah, exactly.
Especially in southern part of China where you know they live.
Basically, a lot of the villages are deep deep, deep into the mountains.
And historically speaking, their dialects can be also very just, you know, two villages.
Different languages.
Yeah, and they speak basically different languages.
So now, with more advanced, more connected for example, high speed railway network that these villages are starting to talking with each other, but also, if they want to reach to their like Steve said, to become better of themselves, they can, you know, taking advantage of this county level platforms and reaching out to outside of, you know, outside the world, to cities and even to the world.
Like many of the county examples that we give, they trade with the world, with multiple countries in this world.
Yeah, it's extended beyond the borders of the country.
Yeah.
And I guess that's one of the factors contributing to the rise, the economic rise in China is that these counties are indeed working together now.
Yeah.
And you might wonder, while some counties they turn from doing just agricultural businesses or industries and transform that into other pillar industries, then what about the local agriculture, development and everything?
But that's not really exactly happening to all the counties here, because the industry, the urbanization and rural revival, they're all happening together in many of the counties in China.
Because in the past the countries industrialized first and goes on urbanization later and modernize the last.
But China now is doing all three at the same time with the counties.
And these counties are kind of where all three are met nowadays.
The factories, they create jobs.
The county towns, they absorb population.
And then the village upgrade agriculture.
So all happening in one place.
That's one of the major drive or the major mechanism that makes this work.
Yes.
For example, in northwestern China, actually in central China, in Hunan province, the Ningjiang, they planned a whole industrial chain for energy, materials and machinery and they attracted many companies to grow together to basically building their own industrial chain.
And on the other side of the country, in Shaanxi, in Shenmue, they are transforming from mining coal to more advanced coal-based industries.
So a lot of industries can happening with these countries.
And also, for example, in Jilin province in northeastern China.
They are also sort of the agricultural base of China.
So not only that they have industrial sectors, they also have trialing out, for example, smart farming and seed technologies, so that they are turning corn into a national level industry.
So it's not just about industries revitalization, not also about agriculture development and also finding I think finding their own strength in the process.
Yeah, finding their strength, of course, finding their own voice, so to speak.
And of course you know there will be challenges, because not every county will develop at the same rate.
So you'll have regional development imbalances from time to time.
You'll have perhaps... fiscal or funding bottlenecks.
You might have some areas with inadequate infrastructure and inadequate public services, or even talent shortages in certain areas as well.
But there are so many different counties and banners and districts here in the country.
Somewhere around 2800, I believe, is the number.
And if they take it upon themselves, as all of the examples we have discussed today, to develop their own regions, along with policy support to help them develop further, then you'll see the kind of success that we learned about today.
That was a great learning experience, a good topic for us to chat about.
