China has pledged to accelerate the development of its digital infrastructure, reinforcing its position as the second-largest computing power globally, trailing only the United States. This commitment follows a rapid expansion of 5G networks over the past five years, which has significantly boosted the nation’s computing capacity. According to Liu Liehong, director of the National Data Bureau, the number of 5G base stations in China grew fivefold to 4.55 million, while gigabit broadband users surged 34 times to 226 million, underscoring the scale of its connectivity advancements.
Despite these achievements, senior officials acknowledge that China’s data infrastructure is still in its early stages. Deputy director Xia Bing stated that efforts will continue to deploy large-scale facilities and cultivate a market-driven ecosystem to fuel both the digital economy and scientific innovation. He emphasized that the country aims to develop a national data infrastructure that is convenient, efficient, autonomous, secure, and world-leading. Data-driven industries are emerging as a vital component of economic growth, with over 400,000 companies contributing 5.86 trillion yuan (US$816.4 billion) in output last year—a 117 percent increase since 2020. This sector is expected to maintain strong growth momentum in the years ahead.
The Yangtze River Delta region, encompassing major cities such as Shanghai, Suzhou, and Hangzhou, has become a leading hub for the data industry. In 2024, it accounted for 22.6 percent of national output and was home to more than 100,000 companies, establishing a robust multi-tier, full-chain ecosystem. Heavy investments in computing power over the last five years are set to continue, with projections showing a 20 percent increase in general-purpose computing power and a 43 percent increase in smart computing power this year, according to a joint report from International Data Corporation and Inspur Information. Between 2023 and 2028, China’s smart computing power is expected to grow at a compound annual rate of 46.2 percent, compared with 18.8 percent for general-purpose capacity.
These advancements come amid intensifying competition with the United States in artificial intelligence. Washington has recently introduced its first comprehensive AI strategy under President Donald Trump’s new administration, which includes tighter export controls on US chipmaking tools and restrictions on the global distribution of Chinese AI models. This move followed the partial resumption of advanced AI chip exports to China by Nvidia and AMD. Earlier this year, China’s DeepSeek AI made headlines by launching a cost-efficient, high-performance large language model that matched or surpassed some capabilities of ChatGPT, drawing global attention to China’s growing competitiveness in the AI landscape.
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