Beijing is accelerating its bid for global leadership in key technologies, planning to pump more than US$1 trillion into the economy through the introduction of everything from wireless networks to artificial intelligence (AI).
In a master plan backed by Chinese President Xi Jinping (習近平), Beijing plans to invest about US$1.4 trillion over six years to 2025, calling on urban governments and private tech giants such as Huawei Technologies Co (華為) to lay 5G wireless networks, install cameras and sensors, and develop AI software that would underpin autonomous driving to automated factories and mass surveillance.
The new infrastructure initiative is expected to mainly bolster local giants — from Alibaba Group Holding Ltd (阿里巴巴) and Huawei to SenseTime Group Ltd (商湯科技) — at the expense of US companies.
As tech nationalism mounts, the investment drive would reduce China’s dependence on foreign technology, echoing objectives set forth previously in the “Made in China 2025” program.
Such initiatives have already drawn fierce criticism from US President Donald Trump’s administration, resulting in moves to block the rise of Chinese tech companies such as Huawei.
“Nothing like this has happened before. This is China’s gambit to win the global tech race,” said Digital China Holdings Ltd (神州數碼) CEO Maria Kwok, as she sat in a Hong Kong office surrounded by facial recognition cameras and sensors. “Starting this year, we are really beginning to see the money flow through.”
The tech investment push is part of a fiscal package waiting to be signed off by China’s National People’s Congress, which convenes today. The government is expected to announce infrastructure funding of as much as US$563 billion this year, against the backdrop of the country’s worst economic performance since the Mao Zedong (毛澤東) era.
The nation’s biggest purveyors of cloud computing and data analysis, Alibaba Group Holding Ltd (阿里巴巴) and Tencent Holdings Ltd (騰訊), would be linchpins of the upcoming endeavor. China has already entrusted Huawei to galvanize 5G.
Tech leaders, including Pony Ma (馬化騰) and Jack Ma (馬雲), are espousing the program.
Digital China is a government-backed systems integration provider, among many that are jumping at the chance. It is bringing half a million units of project housing in Guangzhou online, including a complex three-quarters the size of New York City’s Central Park.
To find a home in Guangzhou, a user just has to log on to an app, scan their face and verify their identity. Leases can be signed digitally via smartphone and the renting authority is automatically flagged if a tenant’s payment is late.
China is no stranger to far-reaching plans with massive price tags that appear to achieve little and there is no guarantee that this program will deliver the economic rejuvenation that its proponents promise. Unlike previous efforts to resuscitate the economy with “dumb” bridges and highways, this newly laid digital infrastructure would help national champions develop cutting-edge technologies.
Bloomberg NEF China Research head Nannan Kou said that China’s new stimulus plan is likely to lead to a consolidation of industrial Internet providers, and could lead to the emergence of some larger companies capable of competing with global leaders such as GE and Siemens.
One bet is on industrial Internet of Things platforms, as China aims to cultivate three world-leading companies in this area by 2025, Kou added.
GlobalWafers Co (環球晶圓), the world’s No. 3 silicon wafer supplier, yesterday said that it is considering further capacity expansion as customers are requesting more capacity due to rising end-market demand and persistent supply constraints. The Hsinchu-based company said that emerging technologies and applications from 5G, artificial intelligence and electric vehicles are driving semiconductor demand. The semiconductor industry has a positive outlook for this year and beyond, with shipments of all diameters of wafers to increase through 2023, GlobalWafers said. “We have received requests for expansion from many strategic partners. We are now in discussions with customers,” company chairwoman Doris Hsu (徐秀蘭) told a
OUTBREAK: About 200 of the airline’s 1,200 pilots are not able to work. Most of them have been quarantined to prevent further infection, but 12 have COVID-19 China Airlines Ltd (CAL,中華航空) yesterday confirmed that it would temporarily reduce its cargo flight services to cope with a pilot shortage, as one-sixth of its pilots have been sidelined by a COVID-19 outbreak. “We are working out a new schedule,” the airline said in a statement after local news media reports on Saturday said that it would be reducing its cargo services from Wednesday, primarily affecting US destinations. CAL declined to give details about its new operating plan, but the reports said that it would be suspending its cargo flights to Dallas Fort Worth International Airport, Hartsfield-Jackson Atlanta International Airport and
XSEMI: The new venture would consolidate the strengths and resources of the two market leaders to secure chip supply and offer clients total solutions, the partners said Hon Hai Precision Industry Co (鴻海精密) and Yageo Corp (國巨) yesterday signed an agreement to form a joint venture called XSemi Corp (國瀚半導體) to develop” small ICs” priced under US$2 per unit, marking the latest effort by Hon Hai to bolster its foothold in the semiconductor market. The collaboration fits into Hon Hai’s plans for expansion by providing a steady supply of small semiconductors, while also serving the global market, the companies said in a joint statement. The new company, to be located in Hsinchu, would “consolidate the strengths and resources of the two market leaders” to provide a “complete semiconductor
German semiconductor producer Infineon Technologies AG on Tuesday said that microchip supply bottlenecks could continue into next year, in a blow to the auto industry. “We predict that the imbalance between supply and demand will continue for a few quarters yet, with the risk that it lasts into 2022,” Infineon chief executive Reinhard Ploss said in a virtual news conference. He added that the “bottlenecks” are a particular problem for the Munich-based company in areas where they do not produce the chips themselves, but buy them from subcontractors to equip microcontrollers for vehicles or smart appliances. The auto industry remains plagued by