The market size of China’s digital economy surged 9.6% year-on-year last year, the fastest worldwide, as the country bets big on the digital economy to drive its economic growth amid the Covid-19 pandemic, industry experts and officials said. According to a white paper by the China Academy of Information and Communications Technology, a government think tank, the market size of the digital economy for 47 countries and regions reached USD32.6 trillion in 2020, with a year-on-year growth of 3%. The value of China’s digital economy reached USD5.4 trillion last year in terms of market size, which ranked second worldwide behind the United States. Germany, Japan and the United Kingdom rounded out the top five. Despite the fragile global economic recovery, the digital economy has played an important role in driving the economic recovery and sustainable economic development for economies around the world, the report said. For the 47 economies surveyed, the digital economy accounted for 43.7% of their gross domestic product (GDP) on average. According to Hu Jianbo, Chief Engineer of CAICT, up to 80% of the country’s digital economy development involves the digitalization of various industries with manufacturing being a main sector.
However, Hu said that more efforts are needed for China to first build a new type of digital infrastructure, like electricity, water and transportation. “The new type of digital infrastructure includes network facilities like data centers and intelligent computing power facilities, as well as assessing and maximizing the value of data from artificial intelligence facilities,” he added. To develop the digital economy, Huang Wei, Academician at the Chinese Academy of Sciences (CAS), said that developing independent bottleneck technologies like flexible electronics should be a priority. “Flexible electronics represent a core technology in the intelligent era. In this sector, the country has gained some momentum in key basic technologies and has good potential to gain the lead globally,” Huang said.
Liu Yulin, Deputy Director of Information and Communications Technology Development at the Ministry of Industry and Information Technology (MIIT), said that super-fast 5G technology will be another new engine of the digital economy over the next few years. As of the end of June, more than 961,000 5G base stations had been built in China, covering all cities at the prefecture level or above. The number of 5G mobile accounts has reached 365 million, accounting for more than 80% of connections globally, Liu said. The digital economy is a focus of the 14th Five Year Plan (2021-25). According to a report published by global consultancy McKinsey & Co, large gaps exist between a handful of leading countries and the rest of the world. The report ranked 139 countries on the basis of inflows and outflows of goods, services, finance, people and data. Singapore led the rankings, followed by the Netherlands, the U.S. and Germany. China has grown more connected, reaching seventh place globally. Liu said China has accumulated a huge amount of data and data streams in a group of areas, including cross-border e-commerce and super-fast 5G development. These are valuable foundations for the development of the digital economy, the China Daily reports.
