Top Chinese policy think tank’s new 15-year ‘smart economy’ plan admits US sanctions have hurt Huawei

A key Chinese policy think tank has delivered its full vision for how the nation can build a “smart economy” by the year 2035.

The vision comes in a new white paper titled “New Infrastructure, New Opportunities: White Paper on China’s Smart Economy Development” from the China Development Research Foundation (CDRF). The Foundation is one arm of China’s Development Research Center, an advisory body that reports to China’s State Council, the nation’s chief administrative authority.

The White Paper has been in the works since late 2019 and an “essential” edition was published in June 2020. Now we have the full 75-page document to consider.

The core theme of the White Paper is that China needs to put technology to work across its economy, and to do that will need to embrace human-machine collaboration and big data, plus wide use of driverless cars and industrial automation. The white paper envisages huge uptake of virtual digital assistants across the economy, plus virtual tours of factories and other digital experiences becoming pervasive. Electric vehicle charging will become ubiquitous and medical services will get smart.

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Wide deployment of 5G networks is a key requirement to build a smart economy, the paper says, but also notes that 5G creates demand for data centres and that China was slow to start building hyperscale facilities. The document says China still faces barriers to data centre builds, and that most local facilities offer uncompetitive power-use efficiency ratings of between 1.5 and 2.0 and that building a smart economy will therefore require improvements to prevent runaway electricity costs.

The paper also predicts something of a data centre building boom, noting that in 2018 China’s facilities had a combined storage capacity of 7.6 zettabytes but that “close to 50 zettabytes” will be available by 2025. The document predicts that 60 percent of workloads in China will run in the cloud by 2023 and foresees a big role for web giants Alibaba, Tencent and Baidu. The latter company provided an advisor to the white paper’s authors.

But the paper also notes plenty of speed bumps. The document notes that Huawei had an ambition to dethrone Intel as the world’s de facto source of data centre silicon, but that US sanctions mean the telecoms giant will struggle to deliver. Education is also mentioned as a challenge: China needs to re-focus on tech-centric services and close the gap to rival nations that have more trained developers, especially in the field of AI.

There’s also a call for dare-we-say revolutionary change to move China’s economy to a more integrated model whereby data about supply and demand is integrated to enable better forecasting, with even transport and energy-generation systems aware of what’s required.

The white paper is advice, rather than binding. But it is also very much reflects the policy direction outlined by president Xi Jinping and the China Development Research Center exists to deliver policy of this sorts so it can be enacted. ®

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