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China\u2019s latest five-year plan enshrines artificial intelligence as a key driver of economic growth and technological innovation.<\/p>\n
While the United States still leads in frontier AI research and the most advanced models, China has focused heavily on deploying AI at scale across its economy. By seeking to replicate the industrial policy playbook that powered its electric vehicle industry to global dominance, China hopes to turn large-scale AI deployment into a new source of economic strength, and ultimately a pillar of China\u2019s national power.<\/p>\n
Achieving China\u2019s AI goals isn\u2019t just about AI dominance; it\u2019s also about creating a dynamic foundation for future economic growth. National Development and Reform Commission chief Zheng Shanjie said<\/a> last week that AI-related industries were expected to exceed 10 trillion yuan (around A$2 trillion) by 2030.<\/p>\n The 15th five-year plan<\/a>, formally adopted last week during annual national meetings of the country\u2019s political elite, identifies several key areas of focus to achieve this goal: developing advanced chips, deepening AI integration and expanding AI infrastructure.<\/p>\n Producing advanced chips. Chinese AI researchers say<\/a> that a key hurdle holding back Chinese AI companies is the lack of advanced chip-making machines. The new five-year plan aims to remedy this, emphasizing that China must \u2018develop high-performance artificial intelligence chips and high-availability basic software stacks.\u2019<\/p>\n Of course, that is easier said than done. Taiwan is dominating the race to produce the world\u2019s most advanced chips; its company TSMC produces<\/a> more than 90 percent of the world\u2019s most advanced chips.<\/p>\n Deepening AI adoption and integration. The five-year plan aims to further embed AI in industries across China\u2019s economy, including to \u2018deepen and expand the \u201cArtificial Intelligence+\u201d initiative.\u2019 First announced in 2024 and known as AI+, that initiative promotes<\/a> the \u2018broad and deep integration of AI across all industries and fields\u2019 with the goal of creating a \u2018revolutionary leap in productivity and a profound transformation of production relations.\u2019<\/p>\n The AI+ initiative has been a significant driver of that deployment story. Announced in the 2024 government work report, it is designed to embed artificial intelligence across China\u2019s entire industrial economy including in manufacturing, agriculture, logistics, healthcare and finance, rather than concentrating adoption in the technology sector alone. The breadth of that push is one reason China is strong in large-scale AI deployment, even as it still trails the US in frontier AI innovation.<\/p>\n Expanding AI infrastructure. The plan calls for faster building of national computing hubs, more high-performance computing capacity, possible ultra-large intelligent-computing clusters, cloud-edge-device coordination, national scheduling and monitoring of computing resources, and lower computing costs for smaller firms.<\/p>\n The real significance of the 15th five-year plan\u2019s AI framework is not any single policy measure but the strategic logic underpinning it. Beijing is attempting to replicate a model that has already delivered global leadership in sectors such as electric vehicles, batteries and solar power: state-backed industrial policy that accelerates deployment at scale until domestic firms dominate the ecosystem.<\/p>\n That strategy has worked before. China\u2019s electric vehicle industry, once dismissed as technologically behind Western competitors, now leads global production and exports. Beijing appears to believe AI could follow a similar trajectory.<\/p>\n Whether that bet succeeds will depend partly on breakthroughs in chips and partly on how effectively China can mobilise its industrial ecosystem. But the AI push is also aimed at bolstering Beijing\u2019s grip on power domestically. Chinese policy emphasises<\/a> that AI must remain \u2018safe, reliable and controllable\u2019, a formulation that ties technological development directly to political stability and party authority. In practice, this means embedding regulatory oversight, ideological alignment and content controls into the AI ecosystem itself.<\/p>\n