Can China lead the world in artificial intelligence by 2030?
Artificial Intelligence (AI) has nowadays become a buzzword in Europe, with the European Union investing in its new AI strategy, as well as Germany issuing its first AI policy this year. However, how do these efforts compare to China’s and does the West have any chance competing against China?
The power of data
In the 21st century, data is king. Gathering data about customers enables companies to run complex statistics, data analytics, machine learning algorithms and recently even implement AI solutions. These “tools” are extremely valuable to develop an understanding of the customer and tailor their marketing campaigns, improve the supply chain, implement chat-bots, and so on, the applications are endless.
This push towards digitalization has already had strong effects on the Chinese daily life. In fact, entirely cashless purchasing experiences and in-app ordering business model are becoming the norm. Chinese are using their phones in ways which remain unthinkable for most Europeans. From scanning QR codes at McDonald’s to order the menu or transferring money through WeChat (Chinese version of WhatsApp) and get your coffee delivered to your door in less than 30 minutes (luckin coffee). This digitalization created enormous databases on which AI algorithms can be developed and trained. From a western perspective, such digitalization up to the customer’s wallet is still relatively elusive, the chart below compares the level of digitization of end customers in the US and China.
The Chinese government set the objective to overtake the US as a world leader in Artificial Intelligence (AI) by 2030. This objective is part of the 13th Five-Year Plan (2016-2020) in which the country is aiming for “a Nation of Innovation” as well as a “New Generation AI Development Plan” meant to increase support and incentives across government levels on AI and AI-driven products.
China understands better than any country the special recipe for economic development. The number of people it lifted out of poverty and its economic growth for such a long period are unparalleled: 68 million people lifted out of poverty in the last 5 years. This was achieved in part due to its early investments in infrastructure: highways, bullet train, electric grid, airport. Now, China is developing the infrastructure of the future, namely: 5G, AI, robotics.
As part of this future oriented plan: some of the most important state-founded AI projects are presented below, from the South China Morning Post. In 2018 alone, China invested a total of 1.83 billion yuan (USD 300 million). These investments serve as an indication regarding the areas receiving governmental support.
AI and digitalization will be mostly used interchangeably throughout this article because their applications are fairly similar as far as this article is concerned.
Application of Artificial Intelligence
China’s investments in AI are already yielding results. For instance, China is already recognized as the world leader in facial recognition. An AI application focused on recognizing people through video cameras and pictures. For instance the technology is used in Shenzhen to track drivers violating traffic rules, it provides a systematic unbiased traffic police-agent. As the camera sees a driver it compares his face with the police database of people whose license has been revoked.
SenseTime exemplifies the Chinese start-up eco-system active in AI. It is developing facial recognition as well as individual tracking algorithms and recently became the world’s highest-valued AI company, at $6 billion. The start-up customers include self-driving car manufacturers, Chinese smartphone manufacturers and most importantly the Chinese government.
The technology is expanding towards movement recognition where AI-driven cameras can recognize the direction someone is walking and in a near future understand someone’s behaviour.s the person’s behaviour violent? Threatening? Dangerous? In order to improve public safety, facial recognition technology, as well as most AI applications require large amounts of data. These companies are recording citizens’ pictures to train their AI algorithms to be able to recognize faces. The fact that the Chinese government is facilitating the regulations in terms of privacy laws and is not engaging in ethical debates to the same extent as western countries currently allows Chinese companies to gain a head start in the global race for data.