China is banking on AI as next driver of growth

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On August 26, the State Council released a high-level directive about the “AI Plus” initiative, marking the next stage of the country’s AI ambitions. First mentioned in the 2024 government work report as a broad slogan and reaffirmed in the 2025 edition, the initiative now comes with concrete targets, timelines and sectoral priorities.
Importantly, the directive is the most detailed blueprint to date, embedding AI across industry, agriculture, energy, services and public administration. Its goal is to accelerate productivity, modernise industries and drive efficiency, positioning AI as a central engine of economic transformation and governance modernisation.
Beyond domestic objectives, the policy underscores China’s ambition to shape the global development of AI. It aims to make Chinese open-source tools widely available, empower countries in the Global South to build AI capacity and bridge the global intelligence divide.
Three major deadlines are outlined. By 2027, AI applications are expected to be embedded in six key sectors, with intelligent terminals and AI agents reaching a 70 per cent penetration rate. By 2030, this figure should surpass 90 per cent, driving high-quality growth across the economy and AI take-up across all sectors. By 2035, China aims to fully transition to an AI-powered economy and society, providing a foundation for socialist modernisation.

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While the directive stops short of pursuing artificial general intelligence – where AI surpasses humans in capability – its emphasis on foundational capabilities signals ambitions extending well beyond immediate applications. Building on existing policies and targets, including the State Council’s 2024 and 2025 goals for creating a digital government, the August directive underscores China’s sustained commitment to leveraging AI for economic, social and governance purposes.

South China Morning Post

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