Eliza Wong
The Policy-Driven AI Transformation
China’s economic paradigm operates with distinct characteristics, where monumental opportunities and era-defining dividends consistently align with strategic policy directives. The recently unveiled 关于深入实施人工智能+行动的意见 (Opinion on Deepening the Implementation of the AI+ Action) represents the most significant directional guidance for the next 5-10 years, marking artificial intelligence’s elevation to national core strategy status.
This comprehensive document, issued by the State Council in late August, transcends viewing AI as merely an emerging technology. Instead, it positions artificial intelligence as a comprehensive national initiative penetrating industry,民生 (livelihoods), consumption, governance, and security sectors. The strategic weight accorded to AI parallels the infrastructure era’s focus on real estate, positioning artificial intelligence as the next strategic pillar industry driving economic growth and nationwide benefits.
Three-Phase Implementation Roadmap
The policy outlines a clear three-phase implementation timeline with measurable targets:
– By 2027: Artificial intelligence will achieve extensive deep integration with six key sectors, with 70% adoption rate for new-generation intelligent terminals and agent applications
– By 2030: AI will comprehensively empower high-quality development, reaching 90% adoption rate for intelligent terminals and agent applications
– By 2035: China will fully enter a new stage of intelligent economy and intelligent society development
Sector-Specific AI Integration Strategies
The document provides detailed action plans for AI integration across six critical domains, each representing substantial investment and transformation opportunities.
AI+科学技术 (Science and Technology)
The strategy emphasizes using artificial intelligence to explore new scientific research paradigms and accelerate innovation. This includes developing AI-driven research methodologies, automated discovery systems, and enhanced computational models that could revolutionize scientific breakthroughs across multiple disciplines.
AI+产业 (Industry)
Comprehensive AI empowerment targets industrial, agricultural, and service sectors, with particular emphasis on cultivating 智能原生 (intelligent-native) new models and formats. This concept represents potentially explosive impacts across entire industries, creating fundamentally new business models rather than simply enhancing existing processes.
AI+消费 (Consumption)
The transformation envisions AI-powered devices including smartphones, computers, robots, smart home systems, appliances, and wearables fundamentally reshaping consumer habits and behaviors. This sector promises the most visible changes to daily life while creating massive market opportunities.
Supporting Policy Momentum and Market Response
Within weeks of the main policy release, two additional heavyweight sectors unveiled complementary AI integration strategies, demonstrating coordinated policy momentum.
Electronics Manufacturing Acceleration
On September 4, two ministries jointly issued the 电子信息制造业2025-2026年稳增长行动方案 (Electronic Information Manufacturing Industry 2025-2026 Stable Growth Action Plan). Beyond supply chain localization and reducing internal competition, the plan encourages regional governments to promote AI terminal innovation and applications while advancing 5G/6G key components, chips, and module technological breakthroughs.
Energy Sector AI Integration
The September 8 release of 关于推进人工智能+能源高质量发展的实施意见 (Implementation Opinions on Promoting AI+ Energy High-Quality Development) by the National Development and Reform Commission and National Energy Authority targets world-leading status in energy-sector AI specialized technologies and applications by 2030.
Market Performance and Investment Implications
Capital markets have responded with extraordinary enthusiasm to China’s AI policy direction, with particular segments demonstrating remarkable performance.
Benchmark Index Performance
The ChiNext Index reclaimed the 3,000-point level on September 11 for the first time in three years. Since its late June rally inception, the index has gained over 50% in approximately two months. From its April low of 1756.34 points, the index achieved maximum gains exceeding 70%, largely driven by AI-heavyweight constituents.
Standout Performers
The market’s favored AI stocks, collectively known as the 易中天 (Yi Zhongtian)组合 (portfolio), have delivered exceptional returns:
– 新易盛 (Shenzhen New Industries Biomedical Engineering): 362% year-to-date gain
– 中际旭创 (InnoLight Technology): 257% year-to-date gain
– 天孚通信 (TFC Optical Communication): 206% year-to-date gain
Even more remarkably, 胜宏科技 (Shengyi Technology) has achieved approximately 700% gains year-to-date, highlighting the extraordinary investor enthusiasm surrounding artificial intelligence opportunities.
Investment Strategies for the AI Era
For individual investors and professionals navigating this transformation, several strategic approaches emerge as particularly relevant.
Embrace AI Integration
Actively incorporate AI tools into professional workflows, treating artificial intelligence as extended capability enhancers rather than replacement threats. Developing proficiency with AI applications represents the foundational step in participating in this technological shift.
Strategic Asset Allocation
Consider appropriate allocations to AI-related assets, including quality company stocks or sector ETFs. The emphasis should be on strategic, long-term positioning in core artificial intelligence assets rather than short-term speculation, particularly avoiding chasing overextended valuations.
Educational Investment
Develop AI literacy within families, particularly for younger generations. Future career paths increasingly will intersect with artificial intelligence capabilities, making early exposure and education valuable long-term investments.
The Trillion-Dollar Opportunity Landscape
The scale of potential economic transformation warrants comparison with historical technological revolutions. According to recent analysis from Sequoia Capital, artificial intelligence is leading a cognitive revolution comparable to the industrial revolution’s impact. The integration with U.S. services automation alone suggests approximately $10 trillion in potential value creation.
When considering China’s comprehensive integration across manufacturing, services, consumption, and additional sectors, the potential market size becomes virtually unimaginable—likely measuring in tens of trillions of dollars. This represents not merely incremental improvement but fundamental reconfiguration of economic structures and value creation mechanisms.
Navigating the AI Transformation
As China accelerates its artificial intelligence transformation, participants across the investment landscape face both unprecedented opportunities and complex challenges. The coordinated policy framework provides clear directional guidance while market responses indicate substantial conviction in the scale of coming changes.
The critical differentiator between passive observation and active participation will be adaptability and strategic positioning. Unlike previous technological shifts, the artificial intelligence transformation affects virtually all sectors simultaneously, creating both diversification benefits and complexity in investment selection.
Forward-looking investors should monitor policy implementation progress, technological adoption metrics, and competitive positioning within key AI sub-sectors. The most successful approaches will likely combine strategic patience with tactical responsiveness to evolving developments in this dynamic landscape.
Engage with fund managers specializing in technology transformation, review existing portfolio exposures to AI value chains, and consider appropriate allocation adjustments to participate in what may represent the most significant wealth creation opportunity of the coming decade. The artificial intelligence revolution is not approaching—it has already arrived, and proactive positioning offers the optimal pathway to participation.
