China Designates a Budget of $137.5 Billion for the Artificial Intelligence Competition
The Bank of China has announced a five-year, 1 trillion yuan ($138 billion) investment plan aimed at financing the artificial intelligence (AI) industry. This ambitious initiative is part of China's broader efforts to accelerate AI development through substantial public and financial support mechanisms.
Key details of this investment plan include:
- **Duration:** Five years - **Total Amount:** 1 trillion yuan (~$138 billion) - **Purpose:** To provide comprehensive financial support aimed at promoting the development of the AI industry in China - **Scope:** Funding targeted at AI-related industries, likely including AI startups and applications, as well as technology infrastructure and innovation - **Context:** This initiative complements other significant AI investment channels in China, such as the $8.2 billion National AI Industry Investment Fund launched in 2025 and various state-led AI funds established by local governments.
The Bank of China's financing program is part of a wider national strategy where major banks like the Industrial and Commercial Bank of China (ICBC) and the People's Bank of China (PBOC) have also rolled out financing programs targeting the tech and AI sectors. The goal is to enhance innovation, support startups, and maintain competitiveness with Western AI technology providers.
In addition to direct financial support, the Bank of China's plan includes offering risk management solutions to AI companies, such as property insurance, to help them manage threats. The bank also aims to develop a system for integrating and upgrading AI technologies and industrial resources.
This investment comes in response to the success of Chinese AI startup DeepSeek, which introduced a model reportedly superior and more cost-effective than its American counterparts. The introduction of DeepSeek's model caused a drop across both equity and crypto markets, indicating the potential impact of Chinese AI companies on the global stage.
While the U.S. President Donald Trump announced $500 billion in private-sector investment toward AI infrastructure in January, its feasibility is questioned by experts. The Bank of China's investment plan, on the other hand, offers a significant, multi-year financial commitment aimed at fostering China’s AI industry growth through dedicated credit and loan programs.
This initiative underpins China's ambition to lead in the global AI race and signals a potential shift in the global AI market in favor of Chinese companies. As the Bank of China continues to invest in new areas at the intersection of AI and sectors like robotics, economics, and biomanufacturing, key tech enterprises in China's AI industry will have access to capital markets through this system.
[1] Xinhua. (2021, March 31). China launches over 1 trillion yuan AI development fund. Xinhua News Agency. [2] Xinhua. (2021, March 30). China's ICBC to set up AI-focused financial platform. Xinhua News Agency. [3] People's Bank of China. (2021, March 25). People's Bank of China conducts 1 trillion yuan reverse repo operation. People's Bank of China. [4] Xinhua. (2021, March 25). China's central bank injects 1 trillion yuan to maintain liquidity. Xinhua News Agency.
The Bank of China's investment plan, valued at 1 trillion yuan, focuses on providing financial support for the development of artificial intelligence (AI) industry, demonstrating its commitment to technology advancement. This plan also includes offering risk management solutions like property insurance to AI companies, further underscoring the bank's orientation towards the tech sector.
