China’s government has identified Artificial Intelligence (AI) as a key technology to push its Made in China 2025 agenda and leapfrog to global technological leadership. When the State Council published its “New Generation of Artificial Intelligence Development Plan” in July 2017, it kickstarted its top-down industrial policy routine which is currently unfolding at full speed. The overarching goals are for China to catch up with advanced countries and create an AI core industry worth 150 billion CNY by 2020, to achieve major technological breakthroughs in AI by 2025, and to become the globally-leading innovation center for AI by 2030. With the overall framework set, China’s industrial AI policy has entered the next crucial phase, trickling down from the national level to individual provinces, municipalities and cities. By mid-April, governments within 18 provinces and municipalities had released AI plans to promote their local AI industries.
Local AI targets even exceed ambitious national goals
In the pursuit to outbid each other, their local targets even exceed ambitious national goals. 11 local governments published targets for their AI core industries for 2020. Accumulated, this would create an AI core industry of almost 400 billion CNY in 2020, exceeding the national target of 150 billion CNY more than twofold. While the unparalleled enthusiasm of local governments will accelerate China’s AI development considerably, it also carries the risk of creating overcapacities.
Frontrunners in the AI race are China’s most advanced economic centers Beijing, Shanghai and Shenzhen. As tech hubs and headquarters of the pioneers of China’s AI drive such as Baidu and Tencent, and of major AI startups including leaders in facial recognition technology SenseTime and Megvii, these cities will harness a massive impetus with powerful state backing.
The municipal government of Shanghai drew up the most ambitious AI plan of all, aiming for an AI core industry size of more than 100 billion CNY by 2020. To achieve this, Shanghai is building AI industry zones in multiple locations across the city. Last December, Shanghai’s Lingang Area Development Administration signed agreements with 15 leading Chinese AI firms, including Baidu Innovation Center, iFlyTek, Horizon Robotics, and Cambricon. Beijing thus sees its position as China’s leading science and technology hub with its stronghold in Zhongguancun seriously challenged. In response to Shanghai’s advances, Beijing’s government announced a 14 billion CNY AI industrial park in Mentougou district in January 2018.
Beyond first tier cities, other localities are also well positioned to compete for dominance in specific AI technologies. In Hefei, for example, the AI-focused industrial base called “China Speech Valley” (中国声谷) is already in full swing, hosting around 200 companies including China’s global champion in speech recognition, iFlyTek. The Anhui provincial government and the municipal government of its capital city Hefei are now joining forces to turn the industrial park into the country’s largest and strongest hub for speech recognition technology products. Together they plan to spend 3.2 billion CNY on R&D and application of intelligent speech and AI technology until 2020.
Provinces that have thus far kept a lower profile now desperately try to jump on the AI bandwagon as well. For example, China’s economically struggling northeastern provinces of Heilongjiang, Liaoning and Jilin all issued their own AI plans at the beginning of this year. According to the ambitions set forth in its plan, Liaoning seeks to transform from a blank spot on the AI map into the biggest AI innovation center in Northeast Asia by 2030.