As China advances in artificial intelligence, it blazes a trail in technological marvels. With a vigorously growing artificial intelligence industry, China has now cultivated multiple companies that are the backbone of China’s technological sector, proliferating over the course of time as the driving force behind its stream of remarkable breakthroughs. In 2023, China’s AI industry was worth more than 578 billion yuan; approximately 81 billion U.S dollars, with 13.9 per cent annual growth rate. In addition, China became a home to over 4,500 AI companies in 2024, revealing that it is carving out a niche for itself in the competitive world of artificial intelligence.
With Beijing’s meteoric rise in artificial intelligence outpacing the West, the tide is now turning in China’s favor as the wave of prodigious success for its AI industry heralds its rise to its sputnik moment of the 21st century
According to a report by the World Intellectual Property Organization (WIPO), China is also at the forefront of driving innovation with 38,210 inventions, which is the highest number of Gen AI patents published over the span of 2014 to 2023, igniting the global AI race for technological supremacy. With Beijing’s meteoric rise in artificial intelligence outpacing the West, the tide is now turning in China’s favor as the wave of prodigious success for its AI industry heralds its rise to its sputnik moment of the 21st century.
In 2017, China revealed its “New Generation Artificial Intelligence”, embodying the ambitious blueprint for pioneering artificial intelligence development and securing global leadership by 2030. In light of its strategic roadmap, Beijing endeavors to capitalize on its infrastructure to operationalize computational power essential to train AI models and enhance operational efficiencies. In addition, China’s National Development and Reform Commission introduced the “National Integrated Computing Power Network” for the integration and optimization of computing resources across the country.
It aims to harness the potential of China’s indigenous computing resources and stockpiled US chips to improve the infrastructural design. A key feature of this project is the China Computing Net. China’s C2NET is a collaborative effort between the Peng Cheng Lab (PCL) and Huawei, serving as an AI computing grid that optimizes hardware use.
China has laid the foundation for its AI development through amalgamation of high-tech processors and enabling efficient deep learning models, essentially. To achieve this, PCL’s infrastructure supported Huawei in developing Pang Gu, entailing large-scale AI models using Ascend 910 chips. In collaboration with Baidu, PCL also developed a cloud-based deep learning technique to reduce compute intensity. The Beijing Academy of Arificial Intelligence (BAAI) has also introduced Wu Dao 2.0 which has been trained on 1.75 trillion parameters, excelling Open AI’s GPT-3 which was trained on 175 billion parameters. By 2023, Chinese organizations developed 79 foundational large-language models (LLMs), based on Silicon Valley architectures to enhance artificial intelligence algorithms.
Furthermore, China’s AI strategy encompasses the pivotal role of national actors, reflecting the instrumentality of a synergistic interaction between government entities and industry experts. The “National Team” concept assigns leading AI firms to set industry standards and develop a cohesive national AI ecosystem. As a result, Chinese tech companies including Baidu, Huawei, Qihoo 360, China Mobile, iFlytek, and Alibaba were entrusted with the integral task of shaping national LLM standards under Shanghai AI Lab’s supervision and guidance in July 2023.
China’s accessible AI structure through the AI-as-a-Service (AIaaS) provided by cloud giants like Huawei Cloud and Tencent Cloud has democratized access to advanced AI capabilities
China’s accessible AI structure through the AI-as-a-Service (AIaaS) provided by cloud giants like Huawei Cloud and Tencent Cloud has democratized access to advanced AI capabilities. Baidu’s Qianfan platform offers 54 pre-configured models and a compendious toolchain which is essential for customization, accelerating AI adoption across industries as well as allowing businesses to integrate and fine-tune AI solutions at a faster pace and save up to 90% of AI-model training costs.
China has been strategically oriented toward promoting “self-reliance and self-improvement” as emphasized by President Xi Jinping who outlined the long-standing ambition of prioritizing innovation, science and technology reforms and self-sufficiency to emerge as a global tech leader by the year 2035. In 2024, the Chinese government unveiled an innovative industrial policy outlining six “future industries” and emphasizing upon utilization of AI to drive industrial transformation and efficiency.
Additionally, China aims to strengthen its standardization framework for AI development by introducing the guidelines for establishment of 50 new national and industry standards, and developing over 20 international standards under the “Guidelines for the Construction of a Comprehensive Standardization System for the National Artificial Intelligence Industry”. These standards are aimed to promote uniformity, enhance China’s AI ecosystem while forming the contours of global collaboration within the realm of artificial intelligence.
As a fundamental enabler in its AI system, China seeks to upgrade and transform data interoperability across diverse segments and fields because the evolution of AI technology will make its dynamic interplay with data increasingly vital in the near future. In addition, experts claim that China is expected to achieve unparalleled data growth as the annual volume of data produced in the country is projected to substantially increase from 24 ZB in 2022 to 77 ZB in 2027, amounting to a yearly growth rate of 26 per cent. Hence, China has launched a comprehensive plan that will center data as the cornerstone of technology innovation integrated with national development, additionally.
Beijing’s diverse industrial landscape cultivates an effective environment conducive for AI integration and adoption, accelerating industrial transformation in all facets of life
Beijing’s diverse industrial landscape cultivates an effective environment conducive for AI integration and adoption, accelerating industrial transformation in all facets of life. China’s AI efficiency and innovation is distinguished by cross-disciplinary fusion of a multitude of technologies within the industrial sector proving essential for modernization as evinced by the fact that 1.7 million industrial robots are operating in its production facilities as of 2023.
Amongst a myriad of initiatives and projects indicating a trend towards vertical integration and specialization, the most notable one includes the CARES Copilot 1.0 system which is based upon the Llama 2 large language model and provides efficient diagnostic services coupled with AI assistance in complex neurosurgeries. In addition, Alibaba’s AI Healthcare Manager offers 20 AI agents from health service providers, such as Angel which has had numerous successful interactions with service users.
With the advent of artificial intelligence and modern technology, energy demands are also now soaring high owing to the fact that foundation models consume up to 33 times more energy, and thereby, require considerable computing power relative to task specific software. In light of this notion, China has prioritized sustainable energy solutions to fuel AI powered advancement while minimizing adverse impact on the environment.
Beijing has shown an unyielding commitment to environmental protection and demonstrated incredible tenacity towards sustainable development and thereby, pursues the development of its AI infrastructure in tandem. It is imperative to highlight that the largest renewable energy industry chain in the world has been established by China. By 2030, China is also expected to contribute 60 per cent of all renewable energy capacity installed globally.
Another significant advantage for the country is found in its ability to readily supply green energy. As a result, China has built 246 green data centres all over the country, carrying an average power utilization efficiency (PUE) of nearly 1.2. The Dongjiang Lake Big Data Centre is an archetype of a promising green data centre. It is located in the Hunan province and operates over 36,000 servers. It provides optimal functioning at the temperature of 26°C which is maintained by utilizing an innovative cooling system and plate heat exchangers.
Moreover, it ensures minimal environmental impact by raising the water temperature by a negligible amount of two to three degrees. It contributes to the reduction of 2 million tonns of carbon dioxide emissions by saving 2 billion kilowatt hours (kWh) of electricity per year while also relying on renewable energy sources including hydroelectric power to sustain its operations.
The U.S Department of Commerce added 25 China-based companies to the trade blacklist, precluding Chinese technology companies from purchasing U.S technology
China’s stupendous success jolted the United States into action to curb its rival’s growing influence. Since 2017, the technological rivalry between the United States and China has intensified through imposition of tariffs, market restrictions and export controls. The U.S chip export controls have prevented China from legally acquiring advanced AI chips including NVIDIA’s A100, propelling China to increasingly rely on its domestically manufactured products such as the Chinese competitor Huawei’s Ascend 910B. As China’s chip production is constrained by resource limitations, AI inference and training for Chinese companies are rendered less efficient and more expensive.
In 2023, the U.S stiff trade restrictions tightened rigorous semiconductor export controls on its superpower rival, China, by restricting its access to Nvidia’s A800 and H800 chips along with imposing stringent limits on exports of manufacturing equipment to the country. More recently, the U.S Department of Commerce added 25 China-based companies to the trade blacklist, precluding Chinese technology companies from purchasing U.S technology.
Nevertheless, China has proven its mettle and continues to overcome barriers with immense resilience and agility complemented with phenomenal AI prowess and amplified efficiency and thereby, made extraordinary headway in the technology sector. Huawei, a Chinese technology giant, is on the rebound from the slump that caused its sales to plummet by launching its revolutionary 5G smartphone.
Additionally, China has reached another monumental milestone by introducing a modern high-efficiency AI chip namely, Ascend 910C, which possesses significant processing capabilities. It challenges NVIDIA’s dominance in the AI chip market as it achieved yield rates of 40 per cent as of February 2025 which represents a doubling from 20% relative to the preceding year.
China is actively mobilizing its resources by employing its domestic open-source software communities such as Gitee and frameworks including Baidu’s Paddle Paddle as primary ingredients of its AI strategy to counteract United States’ hawkish policies. Being has also shifted its focus on forging partnerships with alternative foreign entities, including European nations such as the United Kingdom, Germany and France that are amongst China’s top AI research partners, essentially. As the balance of power within the global AI landscape is now shifting, China’s relentless pursuit of AI dominance and cutting-edge technology will have profound ramifications on the United States’ technological hegemony.
China demonstrated its strategic clout with the release of Deep Seek’s R1 model that sent shockwaves through the technological and artificial intelligence industries
China demonstrated its strategic clout with the release of Deep Seek’s R1 model that sent shockwaves through the technological and artificial intelligence industries. This high-performance, cost-effective, and open-source LLM prompted a steep selloff as America’s Nasdaq slumped dramatically over 3.1 percent while it proved even more detrimental to Nvidia, which suffered a $600 billion market cap loss.
Amid the escalating Sino-U.S. technology competition, China endeavors to press home its advantage and galvanize into action by fast-tracking the rollout of Deep Seek’s R1 model successor, R2 model, offering multilingual reasoning capabilities coupled with enhanced coding abilities. In a concerted effort to retaliate against U.S restrictions, Alibaba aims to increase its investment and allot more than $52 billion to cloud computing and artificial intelligence infrastructure over the course of the upcoming three years.
Moreover, Alibaba’s research arm, Damo Academy, has also launched the C930 chip, which is the latest model in the Xuan Tie RISC-V processor series that is specially designed and tailored for server-level and high-performance computing.
In conclusion, China is gaining a notable global footprint in the domain of artificial intelligence and technology with groundbreaking contributions by virtue of its cohesive framework, comprising a thriving AI ecosystem in conjunction with innovative strategies. As China makes considerable feats and impressive strides that stand as a shining testament to its technological brilliance, the country demonstrates the potential to emerge as a nonpareil architect of the modern era of global technology, paving the way for the renaissance of artificial intelligence and digital transformation.
Disclaimer: The opinions expressed in this article are solely those of the author. They do not represent the views, beliefs, or policies of the Stratheia.
