China's AI industry grew by 43.3 percent during 2016, surpassing 10 billion Yuan (USD 1.47 billion), and it is expected to reach 15.21 billion and 34.43 billion Yuan in 2017 and 2019 respectively. 15,745 AI patents were filed from the country, ranking second worldwide.
Over 40 robotics industry parks have set up or are currently being set up around the country. For the first time ever, AI was included in the government work report by Premier Li Keqiang presented to the Fifth Session of the 12th National People's Congress in March. Prior to the opening of the 2017 Two Sessions, China’s top economic planner, the National Development and Research Commission (NDRC), launched a national engineering laboratory for the research and application of ‘deep learning’, appointing Baidu to lead the lab.
Provincial governments are doing their bit to add to the strong incentives from the centre. A senior official in Zhejiang Province, which is home to Alibaba, said recently that the province aims to hire more than 110,000 AI professionals in the next five years, including 50 world-leading AI experts, 500 scientific entrepreneurs, and 1,000 development and research talent. Zhejiang will set up a 1-billion Yuan (USD 147 million) development fund and a 50-million-Yuan investment fund to support AI professionals and startups.
The three Internet giants, Alibaba, Baidu and Tencent are making huge investments. In July, Baidu unveiled plans to build an open AI ecosystem with program developers and partners. Baidu will roll out two major open AI platforms DuerOS and Apollo, powered by Baidu Brain, the company's core AI system, to speed up development in technology and applications for man-machine dialogue and autonomous driving respectively.
Technology applications seem to be developed and adopted in China at a pace faster than anywhere else. The ability and willingness of the country to embrace change has been demonstrated by the cashless payments revolution, which has nearly eliminated the use of physical money in urban China within less than 5 years.
We take a look at examples of one application of AI, facial recognition. It is being used by traffic management authorities in several Chinese cities across the provinces of Fujian, Jiangsu, Guangdong and Shandong to tackle jaywalking. A week ago, the Financial Times reported that a facial recognition company, Cloud Walk, is trialling a system that uses data on individuals’ movements and behaviour (buying a kitchen knife is OK, but buying a knife followed by a sack and a hammer will raise suspicion levels) to predict the probability of their committing a crime.
China Southern Airlines became the country's first carrier to use facial recognition, with the technology put into use Wednesday at Jiangying Airport in Nanyang city, Henan province. Passengers did not have to get a boarding pass at check-in, as cameras verified their faces against their passport photos. Financial regulators in Macau are using facial recognition at ATM machines to keep tabs on capital outflows from China and watch out for potential money laundering schemes. These are just a few of proliferating applications. New announcements are coming out every week.
The National AI plan
Last month, the State Council laid out an AI strategy, with the aim of growing the country’s core AI industries to a scale of over 1 trillion Yuan (USD 150 billion; a 100 times increase over the 2016 number), driving related industries to exceed more than 10 trillion Yuan by 2030.
The plan seeks to leverage China’s advantages, but it also recognises the current shortcomings. Data is essential for the development of AI technology and China has access to huge volumes of data, due to its large population base and rapid mobile Internet development.
But China still lags the US with regards to basic theory development, core algorithm, key equipment, high-end chips, major products and systems, basic materials, components, software and interfaces. Another gap is the absence of an ecosystem connecting scientific research institutions and enterprises. There is no systematic arrangement for AI research and development. There is a lack of adequate talent. Policies, regulations and standards need to be put in place to support and promote the development of AI.
To deal with these problems, China needs to focus on basic theory and high-end talent. The strategy proposes to do so in three steps. The first step is to reach the most advanced level in AI technology and applications by 2020. China should establish a AI technology standard, service system and industrial value chain. Core AI industries should exceed a scale of over 150 billion Yuan, driving related industries to exceed more than 1 trillion Yuan.
The second step is to achieve major breakthroughs in AI basic theories by 2025. The new generation AI should see wide applications by then in intelligent manufacturing, medicine, urban solutions, agriculture, national defence and other fields. By 20205, the core AI industries should exceed a scale of over 400 billion Yuan, driving related industries to exceed more than 5 trillion Yuan.
The third and final step would be to reach a world leading position in AI theory, technology and application by 2030, with core AI industries exceeding 1 trillion Yuan by then.
To successfully achieve these targets, the plan identifies six tasks, including the establishment of an open and collaborative AI technology innovation system, cultivation of high-end and efficient intelligent economy, building a safe, convenient and intelligent society, strengthening civilian-military integration in AI field and building an extensive, safe, efficient, intelligent infrastructure system.