Introduction
This chapter explores the current state of development, international standing, core competitiveness, and regional differences in China’s artificial intelligence sector. In terms of development status, although financing data for Chinese artificial intelligence has hit an eight-year low and patent applications have decreased, the scale of the core industry continues to grow steadily, and the entrepreneurial environment shows signs of recovery after a period of stagnation. Regarding international standing, China’s position in artificial intelligence continues to rise, but the gap with the United States remains significant. In terms of core competitiveness, China’s rich data resources, expanded educational system, and strong research capabilities lay a solid foundation for the continuous development of artificial intelligence in the future. Finally, in terms of regional differences, the collaborative development of the Yangtze River Delta, the core leadership of the Beijing-Tianjin-Hebei region, and the complementary advantages of the Guangdong-Hong Kong-Macao Greater Bay Area together outline a diversified development blueprint.
1. Core Industry Scale Grows Steadily
In recent years, the scale of China’s core artificial intelligence industry has grown steadily, showcasing the vigorous development and broad prospects of the industry. The innovation of artificial intelligence technology and the expansion of its applications are the core driving forces behind the growth of the industry scale; government policy support for the artificial intelligence industry, such as investment funds, tax incentives, and computing power subsidies, has provided strong backing for the sector. In 2023, as the macroeconomic environment gradually warms up and favorable government policies for the artificial intelligence industry continue to be released, market demand for artificial intelligence has significantly increased, driven by the rapid development of artificial intelligence technologies represented by large models. In 2023, the scale of China’s core artificial intelligence industry reached 175.1 billion yuan, a year-on-year increase of 11.9%. In the future, the artificial intelligence industry is expected to welcome a more favorable development environment, bringing more possibilities for technological progress and economic development in China and globally.
Chart 1: Changes in the Scale of China’s Core Artificial Intelligence Industry in Recent Years (Unit: Billion Yuan)
2. AI Entrepreneurship Shows Signs of Recovery
In recent years, the number of newly established companies related to artificial intelligence in China has shown a trend of first increasing and then decreasing. This change reflects the increasing popularity of artificial intelligence technology in China, while also being influenced by economic, market, and policy factors. From 2000 to 2010, China’s artificial intelligence industry was in its infancy, with the number of new companies increasing year by year, reflecting the initial development of the industry and the gradual recognition of the market; from 2011 to 2017, with technological advancements and policy support, the Chinese artificial intelligence industry entered a rapid development period. The surge in the number of newly established companies indicates the industry’s heat and the active participation of investors. From 2018 to 2023, after experiencing rapid growth, the industry entered an adjustment period, possibly due to a slowdown in economic growth and a lack of investment growth, leading to a decline in enthusiasm for AI entrepreneurship, but stabilizing in 2022 and 2023. Despite the decline in the number of newly established AI-related companies in recent years, the overall view is that China’s artificial intelligence industry still shows strong development momentum and significant market potential.
Chart 2: Changes in the Number of Newly Established AI-Related Companies in China in Recent Years (Unit: Companies)
3. Financing Data Hits Eight-Year Low
Data from 2013 to 2021 shows that the financing amount and number of financing events in China’s artificial intelligence industry have generally exhibited a fluctuating upward trend, reflecting investors’ optimism about the development prospects of artificial intelligence and a surge of capital into the sector. From 2013 to 2017, both the financing amount and number of financing events showed rapid growth, mainly due to technology giants’ aggressive expansion and the establishment of numerous startups, attracting significant investment. Notably, in 2017, the financing amount surged to 302.2 billion yuan, with 914 financing events, setting a historical high and demonstrating strong investor confidence in the artificial intelligence industry. However, from 2018 onwards, both financing amounts and events began to fluctuate. By 2023, the financing amount further decreased to 72.72 billion yuan, with 590 financing events, indicating that investors are continuing to invest cautiously. The decline in financing amounts and events in recent years may reflect a shift from a period of exuberance to a more rational phase, as well as careful consideration of future technological potential and business models.
Chart 3: Financing Situation in China’s Artificial Intelligence Sector in Recent Years (Unit: Billion Yuan, Events)
4. Decline in Patent Applications
In the past twenty years, the number of patent applications for inventions in artificial intelligence in China has gone through a process of increasing from few to many, showcasing the continuous innovation vitality and reflecting society’s emphasis on and investment in artificial intelligence technology innovation. From 2000 to 2010, the growth rate of patent applications for inventions in artificial intelligence was relatively stable. After 2010, the number of applications entered a rapid growth phase, especially in 2016, when the growth rate reached an astonishing 72.4%. After 2018, the growth rate of patent applications began to slow down, with the growth rate dropping to 6.4% in 2022. Notably, in 2023, the number of patent applications for inventions in artificial intelligence in China experienced negative growth, decreasing by 12.7%. This may be due to the lag in the publication of invention patents or the increased difficulty of innovation after technology reaches a certain level. Nevertheless, the number of invention patent applications in 2023 remained high, approaching 80,000, indicating that China’s research and development in artificial intelligence technology still possesses strong vitality. In the future, there is still enormous innovation potential in the field of artificial intelligence in China, but challenges remain in improving patent quality and promoting practical application.
Chart 4: Changes in the Number of Invention Patent Applications in China’s Artificial Intelligence Sector in Recent Years (Unit: Items)
The robust development and immense potential of China’s artificial intelligence industry not only inject new vitality into the domestic economy but also provide significant contributions to the progress and application of global artificial intelligence technology. With the continuous optimization of policies and the ongoing maturation of the market, the future development prospects of artificial intelligence in China are worth looking forward to. For more details, please continue to follow the official updates from the Shenzhen Artificial Intelligence Industry Association, where we will provide you with the latest and most comprehensive industry information and in-depth analysis.
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