President Xi’s industrial power play sees China bet big on AI, chips and smarter factories

President Xi Jinping has emphasized the importance of bolstering China's supply chains and advancing its industrial system, particularly through the integration of advanced manufacturing, artificial intelligence, and smart factories. This push, highlighted at a recent national conference, aims to bolster the Chinese economy and enhance global competitiveness amid slowing growth and challenges in consumption and the property market.

Xi's directives, as reported by state-run Xinhua, come as China has been progressively modernizing its industrial base, transitioning from conventional sectors to a technology-driven, AI-focused industrial landscape. This transformation is driven by a strategic focus on self-reliance and diminishing reliance on foreign components, including chips and hardware designs.

Premier Li Qiang echoed Xi's emphasis on the long-term strategic priority of advanced manufacturing during the conference. He further outlined a vision for smart manufacturing, characterized by the incorporation of data, interconnected machinery, and automation to enhance production efficiency. Li's call for extensive digitization, self-reliance in technology, low-carbon production methods, and inter-sector integration underscores China's ambition to become a "smarter, greener, and more interconnected" manufacturing powerhouse.

Xi underscored the significance of the real economy, defined as the production and trade of tangible goods and services, as opposed to financial dealings. He emphasized the need to lead industrial revitalization through scientific and technological innovation, aligning with China's ongoing strategy of "new quality productive forces."

This shift, as outlined by Xi, signifies a move away from traditional production methods towards a technology-driven industrial model, aimed at elevating China to a leading manufacturing nation.