Following up from yesterday’s newsletter, the State Council was busy this week with a variety of topics in preparation of the National People’s Congress meeting and the new five-year plan. In addition to the plenary session, the State Council yesterday also held a study session on China’s AI+ plans. Study sessions are regular occurrences for high-ranking Party and state organs in China where they invite external speakers and experts to hear about and discuss specific topics relevant to China’s political, economic and social development. Since the development of artificial intelligence already played a significant role in the last five-year plan and will still feature prominently in the future, the study session can be seen as a preparation for future political measures in the new five-year plan.
Three relevant topics are apparent from the readout of the study session. First is the Chinese government’s slightly different emphasis on AI research and development. While large American tech companies focus quite significantly on the development of an artificial general intelligence, China has much more strongly emphasised the specific application of AI across industry and consumer-oriented applications. This was already visible in the documents of the CCP’s fourth plenary session from October last year and will likely feature strongly in the new five-year plan. Chinese companies much more strongly focus on specific AI-based applications and thus have a higher likelihood of being able to generate revenue from their development work. As a study of the Massachusetts Institute of Technology already found last year, a large portion of American tech start-ups have so far failed to generate revenue from their broad AI research and development. China is taking a slightly different path in focussing on roll-out and applications and thus has the potential to become a very serious player and competitor in the world of AI-based software applications over the next couple of years.
The second and related topic in the readout from the study session is the Chinese government’s focus on a whole-of-society approach to AI development. This does not only involve the widespread upskilling of the Chinese population to either partake in the development or at least the daily usage and application of AI-based software solutions. It also involves the plan to make the use of AI much more common in the daily lives of Chinese citizens and across all areas of professional as well as daily life. In line with the application-focussed approach discussed above, this has the potential to achieve the widespread AI-based technologization of the Chinese economy and society. All Western societies, including the US, and certainly Australia and Europe are still very far away from achieving anything comparable and we will likely see huge advances in this field in China over the next few years.
The third topic that appears in the study session read-out is the Chinese government’s desire to advance the regulation (also internationally) of AI. Contrary to many common beliefs in Western societies, China does already have a reasonably advanced regulatory framework for the development and application of AI and they are planning to further advance this over the next few years. This will be highly relevant for businesses because many Western societies still lag behind in this regard and regulatory work in the field of AI will likely contribute to standard-setting in this field. Even if Chinese regulatory standards do not get rolled out internationally, the Chinese market itself is so big that businesses wanting to work and compete in China will have to adapt and comply with Chinese regulations to remain in the market let alone be competitive.
All of this means that AI and the Chinese government’s actions and preferences in this regard need to be on the radar of businesses engaging in and with China. This is not only the case for companies directly involved in the development of artificial intelligence, but also for producing industry as well as service and consumer-focussed industries that will likely come into contact with Chinese AI solutions and regulations. Businesses need to think about questions of AI software application as well as regulatory compliance and data protection both in their countries of origin as well as in China.
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