Explainer
Digital transformation has become a buzzword in China, with even traditional industries like Kweichow Moutai distillery embracing digital processes to create smarter liquor.
However, this trend is just the tip of the iceberg when it comes to China's comprehensive digital strategy known as Digital China. Not only is this strategy a major initiative of the Communist Party, but it also holds significant implications for the country's developmental path and global competition.
Digital China was initiated by General Secretary Xi Jinping after the 18th Party Congress in 2012, the U.S. State Department explained. The strategy aims to digitally transform the nation and pave the way for national informatized development. While largely unknown in the West, this strategy has far-reaching implications for China's future trajectory and its role in shaping the international system.
As a concept tied to Xi Jinping personally, Digital China has been central to his rise and success over the past two decades. It originated as Digital Fujian, an effort to leverage emerging digital technologies for local governance and economic efficiency when Xi served as deputy party secretary and governor of the province in 2000.
Over time, Digital Fujian evolved into the party's vision for a fully informatized Digital China, empowering the nation and benefiting society.
One of the most concrete elements of Digital China is the New Type Infrastructure campaign, which has received significant attention within China but remains largely unnoticed in the West. In response to the pandemic, Xi Jinping directed the Communist Party to accelerate this infrastructure campaign to support the digital transformation of traditional infrastructure and the construction of new digital infrastructure.
The New Type Infrastructure campaign has been allocated an estimated 17.5 trillion yuan (nearly $2.7 trillion) over five years, highlighting the scale and ambition of China's digital transformation efforts. This massive investment will be crucial in realizing the goals of Digital China and further accelerating the country's digital development.
By investing in digital infrastructure, China aims to enhance national competitiveness and increase the efficiency of society as a whole. This new type of infrastructure will enable the adoption of emerging technologies such as 5G, artificial intelligence, and big data, which are expected to revolutionize industries and drive economic growth.
The significance of China's digital transformation goes beyond its borders. As China becomes a global leader in digital technology, it will reshape the norms and rules that govern the international system. It will also have a profound impact on global competition, as countries around the world strive to keep up with China's advancements in digital innovation and infrastructure.
Digital China and the New Type Infrastructure campaign represent the culmination of decades of efforts to transform China into a digital powerhouse. This comprehensive strategy, led by Xi Jinping, has immense implications for China's future development and its role in shaping the international system.
As China invests trillions of yuan in digital infrastructure, it is positioning itself to become a global leader in digital technology and drive economic growth through innovation.
Global stakeholders must understand and engage with China's digital transformation to navigate the evolving landscape of the digital age.