Over 40 per cent of technology leaders think that Silicon Valley will be supplanted by China as the world’s leading tech innovation hub, according to a new report from KPMG.

The consultancy interviewed hundreds of tech execs from start-ups to multi-nationals across the globe and found that 44 per cent believe China will replace Silicon Valley, with the tipping point coming as early as 2016.

India got 22 per cent of the vote as “most likely new Silicon Valley” followed by Japan and South Korea.

“The key takeaway from this survey isn’t that Silicon Valley is becoming less of a force, but that other areas of the world are becoming important technology innovation hubs,” said KPMG partner Gary Matuszak.

The report will be music to the Communist Party’s ears as it tries to achieve a recent goal to transform the People’s Republic an “innovation-oriented country” by 2020 and a “world technological power” by 2049.

Yet despite boasting some big name global tech firms such as Lenovo and Huawei, Chinese firms are sparsely represented in the report’s table of “top companies driving disruptive innovation”. Apple was way out in front with 37 per cent, while Google (23 per cent) and Microsoft (15 per cent) rounded out the top three.

Lenovo was the only ranked Chinese firm, coming in fifth place with 11 per cent of the vote.

However, one area where China is leading, and innovating, is cloud computing.

The Asia Cloud Computing Association last year revealed the Chinese government is set to invest $154 billion to grow the industry and has ascribed five Cloud Computing Service Innovation Pilot Cities to help lead the way.

EMC’s president of Greater China, Denis Yip argued back in June that the country is leading the world in cloud deployments – helped by the fact that most organisations don’t have the 50-60 years of legacy systems holding them back that US and European firms have to deal with.

The Silicon Valley Bank certainly thinks there's potential in the PRC, having announced a joint venture with Shanghai Pudong Development Bank (SPDB) which will see it lend to local start-ups. ®