Technology veteran Kaiser Kuo explains how AI developments with DeepSeek, MiniMax, Moonshot AI, and iFlyTek emerged as winners in China’s technology scene. Especially, the coordination between the state, the market, and academia helps technology to move in the same direction, he adds at the World Economic Forum.
Kaiser Kuo:
One of the less visible but profoundly consequential enablers of China’s rapid advance in generative AI is the unusually tight coordination among its public sector institutions, academic research bodies and private firms. While this kind of alignment is sometimes viewed with suspicion outside of China, particularly when it is framed in terms of state-led industrial policy or state-backed enterprise, the practical effect has been to lower barriers between research and application, to accelerate funding decisions and to unify long-term technological goals across domains.
Consider how China’s most capable research universities — Tsinghua, Peking University, Shanghai Jiaotong, Zhejiang University — serve not only as training grounds for AI talent, but as intellectual incubators for commercial ventures. Many of the leading generative AI firms in China, including Zhipu AI and Baichuan, emerged directly from university research labs, often with seed funding from state-affiliated venture arms and built-in partnerships with municipal development zones or digital economy clusters.
State guidance funds, particularly those aligned with the “New Infrastructure” initiatives launched in the late 2010s, have prioritised compute infrastructure, AI chips and cloud services. These funds offer long-horizon capital to projects that would likely struggle to gain equivalent traction in private markets, particularly during periods of economic tightening or when returns on investment are uncertain. Yet at the same time, the market incentive remains intact. Leading Chinese AI startups face intense domestic competition from rivals like DeepSeek, MiniMax, Moonshot AI and iFlyTek, all of which operate in a fast-moving environment that rewards iterative gains and rapid deployment.
Much more at the World Economic Forum.
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