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China’s Xi pushes AI, tech to drive 2026 growth

China’s president Xi Jinping has emphasized boosting domestic demand and advancing technological innovation, including AI, as key strategies for economic stability in 2026.

In a speech published by the Communist Party’s Qiushi Journal, Xi called for removing restrictions on consumption. He proposed measures such as trade-in schemes and industry upgrades.

Despite a 3.7% rise in retail sales last year, growth lagged behind the country’s 5% GDP increase, indicating a need for stronger consumption support.

Xi also reiterated support for technological self-sufficiency, advocating for the new technologies and improved IP protection, with a focus on AI.

🔗 Source: South China Morning Post

🧠 Food for thought

Implications, context, and why it matters.

This AI push is a formal national strategy with long-term milestones

  • Xi has backed a national policy plan called the “AI Plus” initiative. It seeks wider use of AI across the economy, society and governance 1.
  • The strategy sets numeric goals. It targets more than 70% penetration of new-generation intelligent terminals, agents and other applications by 2027, then over 90% by 2030 2.
  • Officials tie the plan to demographic contraction. They cast AI as a tool to raise efficiency and total factor productivity (a measure of how efficiently an economy turns labor and capital into output) 3.
  • A state-linked publication put China’s AI industry above RMB 900 billion in 2024. It also said China holds about 60% of the world’s AI-related patents 4.

China’s domestic AI plan has global ambitions

  • The AI Plus directive leans on AI-driven consumer tech to lift demand. Trivium China (a China-focused political and economic policy research firm) writes that these areas may draw foreign investment 3.
  • The plan calls AI an “international public good.” It also proposes programs to help Global South countries build AI capacity, which could shape global governance standards 2.
  • It supports open-source communities that can produce projects with global reach. Trivium China says Beijing views open-sourcing as a way to speed adoption abroad and sharpen the competitiveness of Chinese technologies 3.
  • The document links AI to China’s effort to sway international AI governance frameworks and cooperation approaches 2.

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