China central bank adviser says AI may deepen supply-demand imbalance
BEIJING: Artificial intelligence could deepen and prolong China’s strong supply and weak demand imbalance, a central bank adviser said on Saturday, adding to calls for policies that bolster consumption and repair balance sheets across the economy . China’s policymakers have been trying to revive domestic demand amid a prolonged property downturn, local government debt pressures and cautious…
Beijing: Prolonged supply-demand imbalance in China may worsen due to AI, according to a central bank adviser. Huang Yiping, a member of the People's Bank of China's monetary policy committee, warned that the disparity between strong supply and weak demand could deepen with increased AI deployment and innovation. While China's export growth, supported by the global AI boom, has temporarily bolstered the economy amid domestic struggles, Huang cautioned that the imbalance may persist for some time.
He emphasized that policies are needed to boost consumption and repair balance sheets across the economy, as China attempts to revive domestic demand despite property downturns, local government debt pressures, and cautious household spending. Huang advocated for market-oriented reforms, greater market role in resource allocation, and increased overseas investment and industrial cooperation.
He suggested the central government should also increase borrowing to assist local governments, financial institutions, and companies in repairing their balance sheets.
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