With DeepSeek, China's economic growth suddenly seems tied to AI
While artificial intelligence (AI) start-up DeepSeek surprised the world with its latest low-cost reasoning model – dubbed R1 – the revelation reignited overseas interest in Chinese tech and capital market investments while raising expectations that a subsequent surge in AI-fuelled productivity will serve to elevate the national economy.
Advertisement
From analysts to economists, many point to its commercialisation and potential applications in domestic industries.
And they have noted how China's rapid tech progress has defied mounting curbs from Washington, thereby instilling confidence that Beijing will manage to shrug off market concerns stemming from a property crisis, demographic upheavals, and a debt-fuelled growth model to eventually overtake the United States as the world's No 1 economy.
'This could ignite a wave of innovation and accelerate the pace of AI development, which is important for enhancing total factor productivity,' said Ding Shuang, chief Greater China economist at Standard Chartered.
Just like how it has lowered the barrier to entry in the AI field, DeepSeek could catalyse the emergence of low-cost solutions, he said.
Advertisement
'While China's demographic dividend is diminishing, technological innovation holds the key to boosting labour productivity, which will remain critical for sustaining the country's medium- to high-speed economic growth.'
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
South China Morning Post
3 hours ago
- South China Morning Post
Huawei opens HarmonyOS 6 to developers, unveils AI agents and cloud architecture updates
Huawei Technologies has unveiled the latest version of its proprietary operating system (OS), HarmonyOS 6, new artificial intelligence (AI) models and its CloudMatrix 384 AI rack architecture, as the Chinese technology giant accelerates efforts to build out its in-house software ecosystem in the face of ongoing US sanctions. The company introduced a beta version of HarmonyOS 6 at its annual developer conference on Friday, highlighting new features such as AI agents. Richard Yu Chengdong, chairman of Huawei's consumer business group, said the update was now available to developers, but did not specify a launch date for consumers. Huawei has installed HarmonyOS 5 on more than 40 device models, with over 8 million developers registered in its ecosystem and more than 30,000 apps and 'atomic services' – mini programs that run without installation – now available, according to Yu. Still, he acknowledged that HarmonyOS trails Apple 's iOS and Google 's open-source Android in terms of global reach and app support. 'But the top 5,000 apps accounted for 99.9 per cent of consumer time spent' on Huawei devices, he said. The company also announced the HarmonyOS Agent Framework, a toolkit that will allow developers to create AI agents – programs that can perform tasks on behalf of users – without the need to build or train foundation models. More than 50 AI agents, including those from Chinese microblogging platform Weibo and audio platform Ximalaya, would be available when HarmonyOS 6 launches publicly, according to Huawei. Richard Yu Chengdong, chairman of Huawei's consumer business group, introduces the company's laptop with a foldable screen running HarmonyOS on May 19. Photo: Weibo In a further push into AI, Huawei unveiled its latest Pangu models, under version 5.5. The latest family of its AI models include a natural language processing model with 718 billion parameters and a computer vision model with 15 billion parameters. Parameters are a machine-learning term for variables present in an AI system during training.
South China Morning Post
16 hours ago
- South China Morning Post
Who created AI app MediSafe? Hong Kong student and US software firm stake claims
Two Hong Kong government departments have launched an investigation into an award-winning medication prescription app invented by a student that had already been in use by a clinic three years earlier, the Post has learned. Advertisement The Digital Policy Office and Education Bureau said they were studying the mobile app that a student surnamed Poon, from St Paul's Co-educational College in Mid-Levels, submitted in competitions as her invention. Poon declined to respond to online accusations calling her 'a fake inventor', but told the Post she was going through the verification process with competition organisers. Her father, Ronnie Poon Tung-ping, is one of two doctors at a specialist clinic in Central that commissioned a US-based artificial intelligence (AI) software development agency to create the app in 2022, which was subsequently deployed. The investigations were launched after the incident came to light on June 13, prompted by City University student Hailey Cheng, who raised concerns on social media platform Threads about the research and development culture in secondary schools' STEM education and competitions, as well as the privacy of patients using the MediSafe app. Advertisement MediSafe, a medication management system designed to prevent prescription errors through AI-driven verification of patient information, has won at least six awards since August last year. The honours include a silver medal in the 50th International Exhibition of Inventions, Geneva, in 2025, a prestigious globally recognised accolade.
HKFP
16 hours ago
- HKFP
EU bans Chinese firms from major state medical equipment contracts
The European Union on Friday banned Chinese firms from government medical device purchases worth more than five million euros (US$5.8 million) in retaliation for limits Beijing places on access to its own market. The latest salvo in trade tensions between the 27-nation bloc and China covers a wide range of healthcare supplies, from surgical masks to X-ray machines, that represent a market worth 150 billion euros in the EU. 'Our aim with these measures is to level the playing field for EU businesses,' the bloc's trade commissioner Maros Sefcovic said. 'We remain committed to dialogue with China to resolve these issues.' In response, China accused the EU of 'double standards'. 'The EU has always boasted that it is the most open market in the world, but in reality, it has gradually moved towards protectionism', foreign ministry spokesman Guo Jiakun said at a regular press briefing. 'Under the guise of fair competition (the EU) actually carries out unfair competition, which is a typical case of double standards.' The European Commission said in a statement the move was in 'response to China's longstanding exclusion of EU-made medical devices from Chinese government contracts.' Brussels said just under 90 percent of public procurement contracts for medical devices in China 'were subject to exclusionary and discriminatory measures' against EU firms. In addition to barring Chinese firms from major state purchases, 'inputs from China for successful bids' would also be limited to 50 percent, it said. Over the last three years, Brussels and Beijing have come into conflict in a number of economic sectors, including electric cars, the rail industry, solar panels and wind turbines. The decision on medical devices comes at a time of heightened trade tensions with President Donald Trump's United States, which has imposed customs surcharges on imports from all over the world, including Europe. The EU has decided to take a tougher stance on trade in recent years, adopting a vast arsenal of legislation to better defend its businesses against unfair competition. In April 2024, the commission opened an investigation into Chinese public contracts for medical devices, the first under a new mechanism introduced by the EU in 2022 to obtain better access to overseas state purchases. China, on the other hand, accuses Europe of protectionism. After a year of negotiations, the commission, which manages trade policy on behalf of the 27 member states, said it had failed to make any progress with China. 'The measure seeks to incentivise China to cease its discrimination against EU firms and EU-made medical devices and treat EU companies with the same openness as the EU does with Chinese companies and products,' Brussels said.
