Chinese leader Xi Jinping has emphasized the importance of advancing AI in his first formal meeting of 2026 with ministers, as China continues to push for global dominance through its domestic champions, SCMP reports.
Speaking on January 20 at a Central Party School session, the Chinese president described AI as an “epoch-making technological transformation,” comparable to quantum computing and biotechnology as today’s most prominent “frontier technologies.” He also drew comparisons to the changes brought about during the industrial revolution and the early Internet eras, calling specifically for faster progress in indigenous development.
These remarks come as China is preparing for the 15th Five-Year Plan, which begins this year and runs until 2030, and is expected to formalize China’s approach to growth through what Xi calls “new productive forces.” AI predictably sits in the middle of that strategy, both as an enabler of industrial modernization and as a pressure point in China’s rivalry with the United States.
During his session with ministers, Xi urged officials to break the development bottlenecks currently plaguing its domestic tech industry through what he called a “whole-of-nation” approach. Chinese AI giant DeepSeek stunned the world just over a year ago when it released an LLM comparable to the leading models of OpenAI and Meta, but requiring around 11 times less compute, leading the company to a meteoric rise on the coattails of open-source AI.
Since then, we’ve seen an increase in Chinese policy support for the domestic AI and semiconductor industries as DeepSeek’s rise reinforced Beijing’s view that gains at the software level, along with coordinated deployment, can deliver credible results even under export pressure. Access to leading-edge foreign accelerators remains constrained by U.S. trade restrictions, even with the recent walking back of a ban on H200 exports, which Chinese officials have shunned.
Xi’s speech to ministers also carried a warning to provincial governments not to treat AI as an unchecked spending race. “When developing new quality productive forces, we must not blindly or recklessly rush in all at once,” he said, adding that China should not “abandon the old in favor of the new,” and that new technologies should be integrated into existing sectors and adapted to local conditions rather than imposing them uniformly.
There is real concern in China surrounding duplicated investments and heavily subsidized projects that have prioritized scale over all else; it’s understood that China has an excess capacity of compute power in underused, idle data centers. In July, it was reported that a national plan to sell off surplus data centers and regulate the growth and optimization of existing resources was in the works.
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Luke James is a freelance writer and journalist. Although his background is in legal, he has a personal interest in all things tech, especially hardware and microelectronics, and anything regulatory.
