22/05/2020
- The tech investment push is part of a fiscal package waiting to be signed off by the National People’s Congress, which convenes this week
- This initiative will reduce China’s dependence on foreign technology, echoing objectives set forth previously in the ‘Made in China 2025’ programme
A conductor rehearses the military band on the sidelines of the National People’s Congress in Beijing’s Great Hall of the People in March of last year. China’s legislature is expected to sign off on a massive tech-led stimulus plan. Photo: AP
Beijing is accelerating its bid for global leadership in key technologies, planning to pump more than a trillion dollars into the economy through the roll-out of everything from next-generation wireless networks to artificial intelligence (AI).
In the master plan backed by President Xi Jinping himself, China will invest an estimated 10 trillion yuan (US$1.4 trillion) over six years to 2025, calling on urban governments and private hi-tech giants like Huawei Technologies to help lay 5G wireless networks, install cameras and sensors, and develop AI software that will underpin
to automated factories and mass surveillance.
The new infrastructure initiative is expected to drive mainly local giants, from
and Huawei to SenseTime Group at the expense of US companies.
As tech nationalism mounts, the investment drive will reduce China’s dependence on foreign technology, echoing objectives set forth previously in the “Made in China 2025”
programme. Such initiatives have already drawn fierce criticism from the Trump administration, resulting in moves to block the rise of Chinese tech companies such as Huawei.
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“Nothing like this has happened before, this is China’s gambit to win the global tech race,” said Digital China Holdings chief operating officer Maria Kwok, as she sat in a Hong Kong office surrounded by facial recognition cameras and sensors. “Starting this year, we are really beginning to see the money flow through.”
The tech investment push is part of a fiscal package waiting to be signed off by China’s legislature, the
National People’s Congress, which convenes this week. The government is expected to announce infrastructure funding of as much as US$563 billion this year, against the backdrop of the country’s worst economic performance since the Mao era.
The nation’s biggest purveyors of cloud computing and data analysis Alibaba, the parent company of the
South China Morning Post, and
Tencent Holding will be linchpins of the upcoming endeavour. China has already entrusted Huawei, the world’s largest telecommunications equipment supplier, to help galvanise 5G. Tech leaders including Pony Ma Huateng and
Jack Ma are espousing the programme.
Maria Kwok’s company is a government-backed information technology systems integration provider, among many that are jumping at the chance. In the southern city of Guangzhou, Digital China is bringing half a million units of project housing online, including a complex three quarters the size of Central Park in New York City. To find a home, a user just has to log on to an app, scan their face and verify their identity. Leases can be signed digitally via smartphone and the renting authority is automatically flagged if a tenant’s payment is late.
China is no stranger to far-reaching plans with massive price tags that appear to achieve little. There is no guarantee this programme will deliver the economic rejuvenation its proponents promise. Unlike previous efforts to resuscitate the economy with “dumb” bridges and highways, this newly laid digital infrastructure will help national champions develop cutting-edge technologies.
“China’s new stimulus plan will likely lead to a consolidation of
industrial internet
providers, and could lead to the emergence of some larger companies able to compete with global leaders, such as GE and Siemens,” said Nannan Kou, head of research at BloombergNEF, in a report. “One bet is on industrial
internet-of-things (IoT) platforms, as China aims to cultivate three world leading companies in this area by 2025.”
China is not alone in pumping money into the technology sector as a way to get out of the post-coronavirus economic slump. Earlier this month, South Korea said AI and wireless communications would be at the core of it its “New Deal” to create jobs and boost growth.
Nothing like this has happened before, this is China’s gambit to win the global tech raceMaria Kwok, COO at Digital China Holdings
The 10 trillion yuan that China is estimated to spend from now until 2025 encompasses areas typically considered leading edge, such as AI and IoT, as well as items such as ultra-high voltage lines and high-speed rail, according to the government-backed China Centre for Information Industry Development. More than 20 of mainland China’s 31 provinces and regions have announced projects totaling over 1 trillion yuan with active participation from private capital, a state-backed newspaper reported on Wednesday.
Separate estimates by Morgan Stanley put new infrastructure at around US$180 billion each year for the next 11 years – or US$1.98 trillion in total. Those calculations also include power and rail lines. That annual figure would be almost double the past three-year average, the investment bank said in a March report that listed key stock beneficiaries including companies such as China Tower Corp, Alibaba, GDS Holdings, Quanta Computer and Advantech Co.
Beijing’s half-formed vision is already stirring a plethora of stocks, a big reason why five of China’s 10 best-performing stocks this year are tech plays like networking gear maker Dawning Information Industry and Apple supplier GoerTek. The bare outlines of the master plan were enough to drive pundits toward everything from satellite operators to broadband providers.
China’s telecoms carriers push to complete ‘political task’ of 5G network roll-out amid coronavirus crisis
It is unlikely that US companies will benefit much from the tech-led stimulus and in some cases they stand to lose existing business. Earlier this year, when the country’s largest telecoms carrier China Mobile awarded contracts worth 37 billion yuan for 5G base stations, the lion’s share went to Huawei and other Chinese companies. Sweden’s Ericsson got only a little over 10 per cent of the business in the first four months. In one of its projects, Digital China will help the northeastern city of Changchun swap out American cloud computing staples IBM, Oracle and EMC with home-grown technology.
It is in data centres that a considerable chunk of the new infrastructure development will take place. Over 20 provinces have launched policies to support enterprises using cloud computing services, according to a March research note from UBS Group.
Tony Yu, chief executive of Chinese server maker H3C, said that his company was seeing a significant increase in demand for data centre services from some of the country’s top internet companies. “Rapid growth in up-and-coming sectors will bring a new force to China’s economy after the pandemic passes,” he told Bloomberg News.
From there, more investment should flow. Bain Capital-backed data centre operator ChinData Group estimated that for every one dollar spent on data centres another US$5 to US$10 in investment in related sectors would take place, including in networking, power grid and advanced equipment manufacturing. “A whole host of
supply chain companies will benefit,” the company said in a statement.
There is concern about whether this long-term strategy provides much in the way of stimulus now, and where the money will come from. “It’s impossible to prop up China’s economy with new infrastructure alone,” said Zhu Tian, professor of economics at China Europe International Business School in Shanghai. “If you are worried about the government’s added debt levels and their debt servicing abilities right now, of course you wouldn’t do it. But it’s a necessary thing to do at a time of crisis.”
Digital China is confident that follow-up projects from its housing initiative in Guangzhou could generate 30 million yuan in revenue for the company. It is also hoping to replicate those efforts with local governments in the northeastern province of Jilin, where it has 3.3 billion yuan worth of projects approved. These include building a so-called city brain that will for the first time connect databases including traffic, schools and civil matters such as marriage registry. “The concept of smart cities has been touted for years but now we are finally seeing the investment,” said Kwok.
Source: SCMP
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20/04/2020
BEIJING, April 19 (Xinhua) — China will step up efforts to expedite technological research on the construction and application of digital infrastructure, according to the Ministry of Industry and Information Technology (MIIT).
More support should be provided to the research and development of 5G enhancement technology and 6G technology, while the accurate matching of innovation, industrial, capital and policy chains should be promoted, said Chen Zhaoxiong, vice minister of the MIIT.
Chen also stressed the importance of emphasizing the huge demand for digital transformation and improving new digital infrastructure to facilitate economic and social upgrade of the country.
The MIIT will take a string of measures to optimize industrial development, such as expediting construction of 5G and industrial internet connecting people, machine and things, developing new types of intelligent computing facilities, advancing orderly construction and application of large data centers while upgrading micro and small data centers, enriching application scenarios and building a network security system.
Source: Xinhua
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22/12/2019
BEIJING, Dec. 21 (Xinhua) — Ask the silver-haired residents of the elderly care community Yinheyuan in central Beijing what they know about artificial intelligence (AI), and they will probably throw the question to the smart speakers within their reach.
These smart speakers, capable of interacting with users with voice-recognition technologies, are also part of the answer. Via voice command, senior residents can control lights, TVs and other home appliances, order food or ask for help.
AI is no longer a technical term used exclusively by professionals in China. Both young and old are enjoying the benefits of the growing smart economy.
After personal computers (PC), PC internet and mobile internet, the growth focus of China’s digital economy is shifting to smart technologies like AI, said Baidu Chairman and CEO Robin Li at the World Internet Conference in October.
In the smart economy era, Li predicted a declining reliance on cellphones and a rising popularity of other smart devices. AI chips, cloud computing services, among others, would become the new digital infrastructure, while innovative businesses will flourish as transport, health, education and other sectors go smart.
Wearable devices, smart home appliances, autonomous driving and smart cities are among the fastest-growing fields in the smart economy.
China is the largest smart speaker market in the world, accounting for 36 percent of global shipments in the third quarter of 2019, according to global market firm Strategy Analytics. It found in a July and August survey that 63 percent of Chinese people without a smart speaker planned to buy one within the following year. Another 22 percent planned to make a purchase later on.
Chinese firms are stepping up investment in 5G, AI and the Internet of Things to gain a foothold in the emerging field. By end-June, China had over 1,200 AI-related enterprises, according to the Ministry of Industry and Information Technology.
Baidu launched its autonomous driving open platform ApollBo in 2017 to coordinate cross-sector efforts in this field. It has launched several L4 autonomous driving vehicles in partnership with leading automobile companies, and a fleet of Apollo-powered robotaxis are now taking test runs in central China’s Changsha.
Nurturing a smart economy is also on the government agenda. China has passed a guideline to boost the integration of AI and the real economy this year, and plans to build some 20 national AI innovative development pilot zones by 2023.
The country’s AI sector is forecast to be worth more than 160 billion yuan (about 22.83 billion U.S. dollars) in 2020, spurring related sectors to exceed 1 trillion yuan, said Lin Nianxiu, deputy director with the National Development and Reform Commission, citing industrial data.
Lin said China would focus on 100 firms dedicated to AI technologies and relevant applications, improve the industrial ecosystem, facilitate the deep integration of AI and the real economy, and intensify its international collaboration on AI technology, standards, industries, laws and regulations and ethics.
Source: Xinhua
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27/09/2019
- Japan’s Prime Minister Shinzo Abe and EC President Jean-Claude Juncker mark first anniversary of EU-Asia Connectivity scheme with swipes at China
- Partners reach out to countries in Balkans and Africa and agree US$65.5 billion development plan
Japan’s Prime Minister Shinzo Abe (left) and European Commission President Jean-Claude Juncker mark the anniversary of the EU-Asia Connectivity scheme in Brussels, Belgium. Photo: Reuters
The
European Union and
Japan are stepping up their efforts to counter China’s
, with their leaders vowing to be “guardians of universal values” such as democracy, sustainability and good governance.
Speaking in Brussels on Friday, Japanese Prime Minister Shinzo Abe said the world’s third-biggest economy would work with the EU to strengthen their transport, energy and digital ties to Africa and the Balkans – key regions for China’s flagship trade and development project.
At a forum to mark the first anniversary of the EU-Asia Connectivity scheme, Abe and European Commission President Jean-Claude Juncker signed an agreement formalising Japan’s involvement in the Europe-Asia plan that will be backed by a €60 billion (US$65.54 billion) EU guarantee fund, development banks and private investors.
Abe said Japan would ensure that officials from 30 African countries would be trained in sovereign debt management over the next three years, a veiled attack on what Western diplomats claim is China’s debt trap for its belt and road partners.
“The EU and Japan are linked through and through,” Abe said. “The infrastructure we build from now on must be [high] quality infrastructure.
“Whether it be a single road or a single port, when the EU and Japan undertake something, we are able to build sustainable, comprehensive and rules-based connectivity, from the Indo-Pacific to the west Balkans and Africa.”
Japan wants to extend its business reach through its alliance with the EU as its economy slows and geopolitical competition from China takes its toll.
Japan indicates China is bigger threat than North Korea in latest defence review
China’s low-key delegation to the forum was led by Guo Xuejun, deputy director general of international affairs at the foreign ministry.
The US was represented by its deputy assistant secretary of state for cyber policy, Robert Strayer, who was in Europe to lobby against Chinese telecoms giant Huawei Technologies and its involvement in fifth-generation telecoms networks.
Abe and Juncker made cybersecurity the highlight of their addresses. Juncker, who will step down from the presidency by the end of October, repeated his attack on China’s trade policies without naming the country.
“Openness is reciprocal, based on high standards of transparency and good governance, especially for public procurement, and equal access to businesses while respecting intellectual property rights,” he said.
Prime Minister Shinzo Abe says Japan will train officials from 30 African countries in sovereign debt management in three years. Photo: AFP
European policymakers and businesses have for years complained about China’s refusal to allow foreign companies in without a Chinese joint venture partner, a practice that critics claimed involved forced transfer of intellectual property to the Chinese side.
“One of the keys to successful connectivity is to respect basic rules and common sense,” Juncker said, stressing that EU-Japanese cooperation focused on the “same commitment to democracy, rule of law, freedom and human dignity”.
European businesses urge EU to take ‘defensive’ measures against China’s state-owned enterprises
When the commission proposed improved transport, energy and digital infrastructure links with Asia last year, it denied it was seeking to stymie Chinese ambitions.
The EU plan, which would be backed by additional funds from the EU’s common budget from 2021, private sector loans and development banks, amounted to a response to China’s largesse in much of central Asia and south-eastern Europe, where Beijing has invested billions of dollars.
Source: SCMP
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CHINDIA ALERT: You'll be living in their world, very soon 