Beijing unveils grand plan to grow digital economy as US advances competition law – Community News
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Beijing unveils grand plan to grow digital economy as US advances competition law

The Chinese government has released a major plan to boost its global competitiveness in the digital economy before 2025 as the US reportedly moves forward on a bill to approve billions of dollars in funding to bolster US capabilities during the technology war between the US and China.

The 14th Five-Year Plan for the “Digital Economy” published by China’s State Council, or Cabinet, is broad in scope, covering everything from communications to e-commerce.

It will be a “key force in reorganizing global resources, reshaping the global economic fabric and changing the global competitive landscape,” according to the text of the document, released Wednesday but dated December 12, 2021.

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According to the plan, China must seize the opportunities offered by the digital economy. The document, which contains 11 chapters focusing on different areas, does not name any country by name, but notes that “all major countries … carry out strategic planning and take initiatives to create new competitive advantages [that will] reshape the international landscape in the digital age”.

For the five-year period from 2021 to 2025, China will enhance the digital transformation of its supply chain, close data gaps between different industries and social groups, make better use of data resources and improve governance of the digital economy, according to the document.

The plan endorsed a target that output from core industries in China’s digital economy would make up 10 percent of the country’s GDP by 2025, up from 7.8 percent in 2020.

Other targets set include a tenfold increase in the number of Chinese households connected to broadband at speeds of at least 1 gigabyte per second, to 60 million by 2025, up from 6.4 million in 2020.

The booth of Chinese artificial intelligence company SenseTime at the 2021 World Artificial Intelligence Conference in Shanghai. AI is a key technology in the five-year plan for the digital economy. Photo: CNS/AFP alt=The booth of Chinese artificial intelligence company SenseTime at the 2021 World Artificial Intelligence Conference in Shanghai. AI is a key technology in the five-year plan for the digital economy. Photo: CNS/AFP>

Furthermore, 45 percent of China’s industrial enterprises will be connected to “industrial internet platforms” by 2025, up from 14.7 percent last year, while 800 million residents with their real identities will be registered for online government services, compared to 400 million in 2020 , according to the doc.

Under the plan, China aims to improve its fundamental research capabilities in “strategic areas” such as sensors, quantum information, communications, integrated circuits, key software, big data, artificial intelligence, blockchain and new materials.

The country will also strive to improve self-sufficiency in “basic hardware and software, core electronic components, essential basic materials and manufacturing equipment” to improve supply chain security in key industries such as “5G, integrated circuits, new energy vehicles, artificial intelligence” to improve. and the industrial internet,” the document said.

While many of the specific goals in the 14th Five-Year Plan have been included in previous Chinese government documents, the Digital Economy Plan demonstrates Beijing’s strategic vision for a larger and more powerful sector of the digital economy.

For example, it aims to increase the size of the software and information technology services sector from 8.2 trillion yuan ($1.3 billion) currently to 14 trillion yuan by 2025, and boost digital commerce from 37.2 trillion yuan to 46 trillion yuan over the same period.

Beijing’s ambitions for the digital economy and core technologies have fueled fears in the US that the country could lose its technology leadership to China. A report published last month by the Harvard Kennedy School’s Belfer Center for Science and International Affairs states that within the next decade, China is likely to catch up with the US — if it hasn’t already caught up with it — in terms of the fundamental technologies of artificial intelligence, 5G, quantum information science, semiconductors, biotechnology and green energy.

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The US House of Representatives is preparing to move forward with its sweeping bill on China’s competitiveness, Bloomberg reported Thursday. The timing of a House vote became unclear after the Senate passed the bill in June. The US Innovation and Competition Act has infuriated Beijing, as it contains many clauses targeting Chinese technologies and companies.

The US has been the most digitally competitive country in the world since 2018, according to IMD’s 2021 Digital Competitiveness Rankings, which measures how 64 economies are using digital technologies for economic and social transformation. In the same period, China has climbed 15 places to No. 15 on the list.

Additional reporting by Coco Feng

This article originally appeared in the South China Morning Post (SCMP), the most authoritative reporting on China and Asia for over a century. For more SCMP stories, explore the SCMP app or visit the SCMP’s Facebook and Twitter pages. Copyright © 2022 South China Morning Post Publishers Ltd. All rights reserved.

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