Shanghai Announces $707 Million Investment Fund to Support AI Innovations

Published: November 23, 2023 at 5:05 am Updated: November 23, 2023 at 5:06 am

Edited and fact-checked:
November 23, 2023 at 5:05 am

In Brief

China announced a $707 million investment fund for Shanghai to foster innovation in the region’s sectors, including artificial intelligence.

Shanghai Launches Investment Fund to Support AI Innovations

China has initiated an investment fund in Shanghai supported by the National Social Security of China, with an initial phase capitalization of $707 million. The fund is designed to foster innovation in the region and will channel its investments into key sectors including artificial intelligence, biopharmaceuticals and new energy vehicles.

The management of the fund will be entrusted to the investment firm IDG Capital, with a specific emphasis on fostering innovation within the Yangtze River Delta region.

China Embraces AI Potential Locally

In recent years, Shanghai has intensified its efforts to advance its AI sector. The city has witnessed a significant expansion in the scale of its AI industry, with the combined output value of AI enterprises surpassing $42.73 billion in 2021. Moreover, there has been a notable increase in the number of skilled professionals working in the field of AI.

Shanghai has identified AI as one of the three key industries for concentrated development, alongside integrated circuits and biomedicine.

According to a McKinsey report, the widespread applications of AI technology across various sectors such as industrial processes, medical research, and autonomous vehicles could contribute approximately $600 billion annually to China’s economy.

This anticipated value represents almost 3.7 percent of China’s current GDP.

Looking forward to 2030, the Chinese government has set ambitious targets for the AI industry, aiming for annual revenues of $154.638 billion, with related industries generating a total of $1.546 trillion annually.

China’s Global Ambitions for AI

By 2030, China aspires to take the lead in global artificial intelligence, aiming for “intelligence supremacy” through strategic investments.

This vision involves surpassing the United States in technological advancements, exerting influence over disputed territories, and securing a dominant position in global innovation and cognition, considering intelligence supremacy as a crucial objective.

Significant financial resources are being allocated by China to acquire key emerging technologies, with a specific emphasis on artificial intelligence. In recent years, major Chinese tech companies like Baidu and Alibaba have achieved noteworthy milestones in generative AI.

However, the continually evolving regulatory landscape is anticipated to reshape both their strategies and the broader AI environment within the country. As these regulations come into effect, entities in China are expected to navigate through the potential implications these rules may have on their utilization of generative AI tools.

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About The Author

Alisa is a reporter for the Metaverse Post. She focuses on investments, AI, metaverse, and everything related to Web3. Alisa has a degree in Business of Art and expertise in Art & Tech. She has developed her passion for journalism through writing for VCs, notable crypto projects, and engagement with scientific writing.

Alisa Davidson