China will increase its computing power by over a third by 2025, aiming for more than 300 exaflops (one quintillion floating-point operations per second), up from 220 this year as the U.S. prepares for harsher tech sanctions on the country.
This initiative, announced by several agencies, including the Ministry of Industry and Information Technology, is part of Beijing’s broader strategy to enhance its technological self-reliance amidst U.S. sanctions.
The plan includes constructing 20 new smart computing centers within two years and expanding optical networks and advanced data storage by 2025.
These enhancements will bolster manufacturing, education, finance, transportation, healthcare, and energy sectors, Bloomberg reports.
Chinese companies, including Alibaba Group Holding Limited (NYSE: BABA), recently emphasized an AI-first approach and an unwavering focus on user experience.
The company prioritizes AI-driven tech businesses, internet platforms, and its global commerce network as part of its strategic investments as it faced growing competition from companies like ByteDance Ltd in social media and Baidu Inc (NASDAQ: BIDU) in AI.
China plans to establish more data centers nationwide to achieve the target, enhancing businesses’ access to computing power with special attention on improving the computational infrastructure in the country’s western regions.
Provinces like Guizhou, though expansive, are less populated and have been designated to host massive data centers to support the nation’s internet power.
International tech giants like Apple Inc (NASDAQ: AAPL) have already established data centers in these areas in collaboration with local partners.
The Chinese government emphasizes developing and utilizing domestic, reliable software to strengthen the industry and secure the supply chain. U.S. restrictions on exports of high-end products to China, including advanced chips essential for AI model training, amplified this focus on supply chain security and self-reliance. In response, China promotes home-grown IT products, aiming for a supply chain free of American components.
Companies like Huawei Technologies Co. and Semiconductor Manufacturing International Corp., both blacklisted by the U.S., are at the forefront of this technological advancement. They have made significant strides, including developing a sophisticated chip for Huawei’s latest smartphones, challenging the effectiveness of U.S. restrictions, and underscoring China’s progress toward technological self-sufficiency.
Price Action: BABA shares traded lower by 2.44% at $83.96 premarket on the last check Monday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
