The city of Hangzhou is one of the most historic and beautiful in China.
But this ancient place now has the most modern of reputations, as China’s ‘Silicon Valley’.
A vibrant hub for entrepreneurs and high-tech start-ups, Hangzhou is home to headline-grabbing success stories like Alibaba and breakthrough AI firm, DeepSeek.
Those who are part of the tech scene here brim with enthusiasm.
Image: Hangzhou, in Zhejiang province, has been labelled ‘China’s Silicon Valley’
Over coffee, in an ultra-modern city complex, they describe how exciting this moment feels, not just for their businesses, but for China too.
“We have the talents, we have the environment, and we have the full supply chain, even though we have a challenging environment,” says Grace Zheng, who has worked at the AI glasses creator Looktech since its inception.
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“It’s our time.”
The others laugh and nod. “I agree with it,” says Jia Dou, whose company Wuli Coffee, creates high-tech, automated commercial coffee machines. “And I think it’s our time to show and battle with other foreign countries.”
Image: Grace Zheng is enthusiastic about the future for China
And is that a battle China could now win, I ask? “Of course,” comes the answer.
They tell stories of how estate agents in Hangzhou dedicated hours of their time for free to find the perfect laboratory space, and how the local government showered them in grants and incentives; so hungry is this city for tech success.
Image: These entrepreneurs in Hangzhou say the city supports a vibrant hub of tech start-ups
“Hangzhou says we’ll provide the sunshine and the water, you go ahead and grow,” explains Zhang Jie.
She is the convenor of this group. An entrepreneur herself and the founder of a thriving ‘incubator’ for start-ups, she has invested in and mentored all the others around the table.
She is passionate, energetic and has a second-to-none understanding of what makes Hangzhou and China’s tech scene so successful.
“In China, we have more than 10 million university and college students graduating. Then we’re talking about at least five to six million engineers with college education background,” she says.
“So with such a large group of young and intelligent people with a good environment, a favourable environment for entrepreneurship, I’m sure there will be even greater companies coming in the future.”
Image: Zhang Jie helps start-ups in Hangzhou, where she says entrepreneurship is able to thrive
Indeed, a combination of light-touch local regulation, (unusual in China more broadly), coupled with one of the most business-oriented and free-thinking universities in the country, Zhejiang University, is viewed by many as the secret sauce in Hangzhou.
Zhang says she has had more young people approach her with business ideas in the last quarter than at any other time before, and she is full of optimism about the current wave.
“They are already companies [in China that will] probably be greater than Apple, right?” She laughs.
And she may well be right.
But there is one name in particular, born and bred in Hangzhou, that has captured the world’s attention in recent months.
When DeepSeek unveiled its latest open-source AI model earlier this year, it stunned the world, claiming to be as good as western competitors for a fraction of the price.
Image: The Hangzhou HQ of DeepSeek, which has stunned the world with its recent AI advances
Many are now talking about the ‘DeepSeek moment’, a moment that turbocharged confidence within China and made the rest of the world sit up and take notice.
Indeed, successes like this are being lauded by China’s leaders. In February, tech bosses, including DeepSeek’s founder Liang Wenfeng, were invited to a symposium with Xi Jinping and his top team.
Photo ops and handshakes with the president, an abrupt change from the crackdown they faced just a few years ago. In fact, tech is now being positioned as a key pillar in China’s future economy, repeatedly highlighted in official communications.
But what is seen as inspiring innovation in China is viewed by the United States as a threat.
Businesses in Hangzhou are of course aware of the trade war unfolding around them, many who export to America will take a significant hit, but most think they can cope.
Dr Song Ning is one of them. He proudly shows us his factory, which is integrated with the lab work and R&D side of his business.
His company, Diagens, uses AI to massively speed up medical diagnostics, cutting the time taken to run a chromosomal screening from 30 days to 4. He is also working on a chatbot called WiseDiag which has more advanced medical understanding and can be used by patients.
Image: This lab at the firm Diagens is using AI to speed up medical diagnostics
While they are actively seeking business in over 35 foreign countries, for now, the pursuit of American customers is on pause.
“Competition is a good thing… it makes us all stronger,” he says.
Image: Dr Song Ning believes Donald Trump’s policies will not be able to impede innovation
“I do not think by limiting the scientific and technological progress of China or other countries, Trump will be able to achieve his goal, I think it is a false premise.
“Information is so developed now, each country has very smart people, it will only force us to have more tech innovation.”
While individuals remain defiant, the trade war will still leave a big hole in China’s economy. Tech firms, however advanced, can’t yet fill that gap.
But the innovation here is rapid, and there is no doubt, it will leave its mark on the world.
Donald Trump’s special envoy, Steve Witkoff, has reassured the remaining Israeli hostages held in Gaza that they will soon be reunited with their families, saying that “miracles can happen”, as the country prepares for a momentous reunion.
In an emotional speech at a rally in Tel Aviv’s Hostages Square on Saturday, Mr Witkoff directly addressed the hostages, declaring, “You are coming home”, prompting loud cheers from the tens of thousands gathered in the square.
“Your stories have lived in every heart, here tonight and in mine since I began this job,” he said.
“And now, as you return to the embrace of your families and your nation, know that all of Israel and the entire world stands ready to welcome you home with open arms and endless love.”
Speaking alongside Mr Trump‘s daughter and son-in-law, Ivanka Trump and Jared Kushner, Mr Witkoff said he had “dreamed of this night” and that “it’s been a long journey”.
Some in the crowd yelled, “Thank you, Trump, thank you Witkoff,” and booed when the envoy mentioned Israeli Prime Minister Benjamin Netanyahu.
Image: Steve Witkoff, Jared Kushner and Ivanka Trump at the rally in Tel Aviv’s Hostages Square. Pic: Reuters
Addressing the families of the hostages, Mr Witkoff said, “each and every one of you have carried the moral weight of this nation”.
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“Your courage has moved the world and has touched me in ways that I have never been touched before in my entire life,” he added.
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1:54
‘Quite a reception’ for Witkoff but Netanyahu boos ‘not surprising’
Mr Kushner said they would celebrate on Monday, when the remaining hostages will be released. Twenty hostages are believed to still be alive, 26 have been declared dead, while the fate of two more is unknown.
The president’s son-in-law, who played a key role in the negotiations, also acknowledged the “suffering” in Gaza.
Meanwhile, the president’s daughter, Ivanka, addressed the crowds, saying, “the president wanted me to share, as he has with so many of you personally, that he sees you, he hears you, he stands with you always”.
Once all the hostages are released, Israel will free 250 Palestinian prisoners serving life sentences and 1,700 Gazans detained after the October 7 attacks.
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6:59
How will peace plan unfold?
Israelis at the rally hugged, took selfies, and many waved US flags.
“It’s a really happy time, but we know that there are going to be some incredibly difficult moments coming,” said Yaniv Peretz, who was in the crowd.
Gaza ‘completely destroyed’
The speeches in Tel Aviv came as the Gaza ceasefire continued to hold for a second day, with tens of thousands of Palestinians returning to neighbourhoods devastated by the conflict.
“Gaza is completely destroyed. I have no idea where we should live or where to go,” said Mahmoud al Shandoghli in Gaza City as bulldozers clawed through the wreckage.
The World Food Programme has announced it is prepared to reopen 145 food distribution centres across Gaza, once Israel allows increased aid deliveries. Prior to Israel’s closure of the territory in March, UN agencies had operated 400 such centres.
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2:59
Final preparations for hostages
While details about the timing and method of food entry into Gaza remain uncertain, reopening these sites would significantly expand access to food.
Roughly 170,000 tonnes of food aid are currently stockpiled in neighbouring countries, awaiting Israeli approval to enter.
About 200 US troops have arrived in Israel to monitor the ceasefire with Hamas.
They will establish a centre to coordinate the delivery of humanitarian aid and provide logistical and security support.
“This great effort will be achieved with no US boots on the ground in Gaza,” Admiral Brad Cooper, the head of the US military’s Central Command, has said.
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2:36
How the war shattered homes in Gaza
Summit in Egypt
World leaders and diplomats are heading to the Egyptian city of Sharm el-Sheikh for an international summit on Monday aimed at finalising permanent peace terms.
Before chairing the summit, Mr Trump is expected to visit Israel on Monday where he will address the Knesset, the Israeli parliament.
Representatives from regional countries, along with European leaders including Sir Keir Starmer, are expected to attend the summit and sign the agreement as guarantors.
Meanwhile, the deputy head of the Palestinian Authority has told the Saudi Al Arabiya news channel that he will meet former UK prime minister Tony Blair in Jordan on Sunday.
Hussein al Sheikh said the pair will discuss the “day after” the war in Gaza.
Image: People in Hostages Square hold placards with pictures of the remaining hostages. Pic: Reuters
As part of Mr Trump’s 20-point peace plan, the former prime minister is set to head the international interim administration that will govern Gaza in its transitional period.
However, the prospect of Mr Blair being part of an international supervisory body in Gaza is unpopular with many Palestinians.
The secretary general of the Palestinian National Initiative told Sky News, “we don’t need him for many reasons”.
“His reputation in Iraq is horrible, he has a not very clear reputation I would say, and finally when he was here in Palestine for seven years he didn’t do anything,” Mustafa Barghouti said.
Drones have been a common sight in Gaza for a long time, but they have always been military.
The whine of a drone is enough to trigger fear in many within the enclave.
But now, drones are delivering something different – long, lingering footage of the devastation that has been wreaked on Gaza. And the images are quite staggering.
Whole city blocks reduced to rubble. Streets destroyed. Towns where the landscape has been wholly redesigned.
Image: Whole city blocks reduced to rubble
Decapitated tower blocks and whole areas turned into black and white photographs, where there is no colour but only a palette of greys – from the dark hues of scorched walls to the lightest grey of the dust that floats through the air.
And everywhere, the indistinct dull grey of rubble – the debris of things that are no longer there.
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Image: Gaza is full of people returning to their homes
The joy that met the ceasefire has now changed into degrees of anxiety and shock.
Gaza is full of people who are returning to their homes and hoping for good news. For a lucky few, fortune is kind, but for most, the news is bad.
Umm Firas has been displaced from her home in Khan Younis for the past five months. She returned today to the district she knew so well. And what she found was nothing.
Image: Umm Firas returned to find nothing
“This morning we returned to our land, to see our homes, the neighbourhoods where we once lived,” she says.
“But we found no trace of any houses, no streets, no neighbourhoods, no trees. Even the crops, even the trees – all of them had been bulldozed. The entire area has been destroyed.
“There used to be more than 1,750 houses in the block where we lived, but now not a single one remains standing. Every neighbourhood is destroyed, every home is destroyed, every school is destroyed, every tree is destroyed. The area is unliveable.
“There’s no infrastructure, no place where we can even set up a tent to sit in. Our area, in downtown Khan Younis used to be densely populated. Our homes were built right next to each other. Now there is literally nowhere to go.
“Where can we go? We can’t even find an empty spot to pitch our tent over the ruins of our own homes. So we are going to have to stay homeless and displaced.”
It is a story that comes up again and again. One man says that he cannot even reach his house because it is still too near the Israeli military officers stationed in the area.
Another, an older man whose bright pink glasses obscure weary eyes, says there is “nothing left” of his home “so we are leaving it to God”.
“I’m glad we survived and are in good health,” he says, “and now we can return there even if it means we need to eat sand!”
Image: A man says there is ‘nothing left’
Image: A bulldozer moves rubble
The bulldozers have already started work across the strip, trying to clear roads and allow access. Debris is being piled into huge piles, but this is a tiny sticking plaster on a huge wound.
The more you see of Gaza, the more impossible the task seems of rebuilding this place. The devastation is so utterly overwhelming.
Bodies are being found in the rubble while towns are full of buildings that have been so badly damaged they will have to be pulled down.
Humanitarian aid is needed urgently, but, for the moment, the entry points remain closed. Charities are pleading for access.
It is, of course, better for people to live without war than with it. Peace in Gaza gifts the ability to sleep a little better and worry a little less. But when people do wake up, what they see is an apocalyptic landscape of catastrophic destruction.
The thought of Hamas publicly thanking Donald Trump for his peacemaking efforts would have been impossible to imagine just days ago.
This, after all, is the president who vowed “all Hell” would be unleashed on Hamas if the hostages weren’t returned.
And yet, in an exclusive interview with Hamas’s senior leader Dr Basem Naim, that’s exactly what happened.
“Without the personal interference of President Trump in this case, I don’t think that it would happen to reach this end, the end of the war,” Dr Naim told me.
“Therefore, yes, we thank President Trump and his personal efforts to interfere and to pressure Israel to make an end of this massacre and slaughtering.”
He was speaking from his office in Doha, where last month he and a group of Hamas leaders, meeting to discuss Trump’s plan, were targeted in an Israeli air strike.
He survived the attack, and in the days that followed, international condemnation seems to have helped build momentum towards the ceasefire deal finally being reached.
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Image: It’s been a week in which news of a major peace plan breakthrough came in a surreptitiously passed note. Pics: Reuters/AP
Serious pressure
This is the unpredictable, and frankly unbelievable, world of global politics right now: A Hamas leader, who narrowly escaped assassination just weeks ago, telling me he believes Donald Trump is the key man to ensure Israel sticks to the ceasefire agreement.
Let’s be clear: Hamas is under serious pressure.
It is facing calls to step away from governing Gaza and disarming altogether, not just from Israel and the US but regional powers as well.
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2:43
Could Gaza ceasefire lead to a much bigger peace?
Gaza needs an enormous amount of aid, investment and reconstruction.
A humanitarian catastrophe which has killed 67,000 Gazans, destroyed or damaged 90% of people’s homes and forced 1.2 million people to become displaced.
The message from major international powers is that their long-term commitment will require a new ruling force in the strip.
Dr Naim told me the organisation was willing to cede political control but rejected calls to lay down their arms until a comprehensive agreement was reached.
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1:23
Hamas statement on peace deal
“We are ready to hand over government, we are ready to be totally away from any government or government body but when it comes to Hamas as an entity, as a Palestinian liberation movement, I think no one can overcome or exclude Hamas,” he said. “Our weapons are only going to be handed over only to the hands of a Palestinian state and our fighters will be integrated into a Palestinian national army.
“Before that, no one has the right to deny us the right to resist the occupation by all means.”
The negotiators of Wednesday’s deal in the Egyptian resort of Sharm el-Sheikh may choose to ignore those comments for the time being.
Image: Displaced Palestinians begin to head to what is left of their homes in southern Gaza Strip. Pic: AP
There is, after all, undeniable relief that the fighting has finally stopped, the hostages will be released and 2 million Gazans can sleep safely without the fear of Israeli bombardment.
But for the next phase of this deal to be realised, it will need clear answers as to who runs Gaza?
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Donald Trump and his team believe former British prime minister Sir Tony Blair will have some role to play, something the Hamas official was quick to dismiss.
Image: Sir Tony Blair ‘not welcome’. Filepic: Reuters
“To be honest, when I hear the name Tony Blair, I can see this could be Balfour Declaration 2… I think all Palestinians, not only in Hamas, not only in Gaza, have very bad, and very negative image of him.
“And I do not believe that he will be very welcome.”
There will be many who read his comments as proof the organisation has no intention of relinquishing control of Gaza.
Hamas itself may feel some sense of achievement that it was the only representative of the Palestinian political factions involved in the negotiations earlier this week.
But the key question now is, who will be responsible for the governance of Gaza and the daunting security challenges that millions are facing.