Giving the real economy an AI upgrade

SHI YU/CHINA DAILY

At a factory in Central China, production once depended on workers dashing between machines, adjusting schedules by hand and fixing faults after they occurred. Today, artificial intelligence quietly orchestrates the entire process — allocating tasks, monitoring quality and optimizing output in real time. The machines no longer wait for instructions; the system thinks for itself.

This shift captures what China calls "AI Plus" — the deep integration of artificial intelligence with the real economy. Under the 15th Five-Year Plan (2026-30), the implementation of the "AI Plus" initiative is expected to be elevated to a national campaign, designed to foster new quality productive forces. It is productivity driven not by scale alone, but by technological breakthroughs, smarter resource allocation, and industrial upgrading.

Artificial intelligence is central to this transformation because it is a general-purpose technology — much like electricity or the internet — that reshapes how economies function across sectors. Accelerating the development of next-generation AI is essential for securing a leading position in global technological competition. In practice, AI is already redefining the fundamental factors of production. Workers collaborate with intelligent systems to upgrade skills, tools evolve into smart equipment and data become a production factor as vital as land and capital.

The impact is especially visible in China's traditional industries, which still account for more than 80 percent of manufacturing output and remain the backbone of economic stability. Rather than replacing these industries, "AI Plus" is giving them a second life. Different regions are pursuing tailored paths. Zhejiang promotes industry-specific large models through closer coordination between chips and industrial molds. Guangdong's "hundreds of industries, thousands of models" initiative pushes digital transformation across entire manufacturing chains. In Hunan's Changsha-Zhuzhou-Xiangtan urban cluster, engineering machinery firms are moving from isolated enterprise-level automation to coordinated, cluster-wide intelligence, supported by shared digital platforms.

Concrete results are already emerging. At Zhuzhou Qianjin Pharmaceutical, an established drug manufacturer in Hunan, AI-driven production scheduling has cut monthly planning time from three days to less than 30 minutes, while output has risen by 33 percent. At Hunan Valin Xiangtan Iron and Steel, more than 40 AI applications — from intelligent crane dispatch to coke quality prediction — have enabled a full digital upgrade of steel production. These examples underline a critical point: AI is not hollowing out traditional industries; it is making them more resilient, efficient, and competitive.

At the same time, "AI Plus" is opening new growth frontiers. Advances in large models and falling computing costs are pushing AI out of laboratories and into everyday production and services, generating new technologies, products, and business models. As a strategic research hub in artificial intelligence and advanced computing, Xiangjiang Laboratory has tackled several critical bottlenecks, including stem cell intelligent preparation, embodied AI interaction and control, and domain-specific large models. Its fully automated stem cell adherent preparation system is among the first of its kind worldwide, while the Xiangjiang Xuanyuan Pathology Large Model has been recognized among China's leading domestic AI pathology models.

Computing power, the backbone of AI development, has become a major industry in its own right. In Changsha, Hunan province, CiDi is advancing autonomous driving for commercial vehicles, operating large fleets of unmanned mining trucks alongside human-driven vehicles. In many cases, these AI-driven fleets achieve higher efficiency than conventional operations. This integration of AI with industrial research and development is accelerating breakthroughs in core technologies and expanding the frontier of new-type productivity.

Importantly, "AI Plus" is also reshaping public services and social governance, giving technological progress a more human dimension. Productivity gains ultimately matter only if they improve people's lives. In Linwu county, Hunan province, an "AI Smart Service" window now handles common government services such as business registration and social insurance, responding quickly and reducing the need for repeat visits. Volunteers assist elderly users, and dialect-based voice recognition helps make the service accessible to more people. In Changsha's Xiangjiang New Area, fully autonomous cloud buses provide residents with a safer and more convenient commuting option. These applications show that AI is becoming not just an economic engine, but also a tool for more inclusive governance.

To sustain this momentum, China must build a supportive ecosystem for "AI Plus" development on multiple fronts. That means strengthening technological foundations in areas such as high-end chips, core algorithms, and industry-specific large models, while improving computing infrastructure and data governance. It requires deeper integration between AI and sectors ranging from manufacturing and agriculture to services and tourism, alongside continued upgrading of traditional industries. Sound governance is equally essential: clear legal frameworks, ethical standards, and safeguards for data security and algorithmic accountability must keep pace with innovation.

Finally, bridging the digital divide is critical. AI applications in education, health care, elder care, and government services must be accessible to all, supported by targeted digital skills training and inclusive design. At the same time, risks ranging from data breaches and algorithmic bias to labor market disruptions must be carefully monitored and managed.

Handled well, "AI Plus" can do more than raise efficiency figures. It can help China build a more innovative, resilient, and people-centered economy — one where productivity growth is not just faster, but smarter and fairer.

The author is the director of Xiangjiang Laboratory in Hunan, an academician of the Chinese Academy of Engineering and a member of the 14th National Committee of the Chinese People's Political Consultative Conference.

The views don't necessarily reflect those of China Daily.

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