Soaring Tech Stocks in China Due to AI Mania
In a significant move, Chinese internet companies are gearing up to significantly boost their investments in Artificial Intelligence (AI). According to recent projections, total investments in AI are expected to reach an impressive $32 billion by 2025, more than double the $13 billion invested in 2023.
This surge in investment is being driven by a number of factors, with a strong ecosystem and state-backed funding playing key roles. Notable companies such as NIO, a Chinese electric vehicle manufacturer, are planning substantial investments for expansion. NIO is set to invest RMB 20 billion, a significant sum, in the AI sector.
The Chinese government is also supporting the growth of AI, with over 5,000 AI firms receiving government backing. This support includes a 60 billion yuan (approx. 8.4 billion USD) investment fund and the establishment of over 40,000 intelligent factories and multiple national pilot zones for AI innovation.
Tencent, one of China's leading internet companies, returned to the dim-sum bond market on Tuesday, raising 9 billion yuan ($1.27 billion). This marks Tencent's first bond issuance in four years, demonstrating confidence in the company's future prospects.
Meanwhile, in the northwest province of Qinghai, State television reported that the Sanjiangyuan data center of China Unicom had signed contracts to use AI chips from Chinese companies, including Alibaba's chip unit T-Head. Chinese Premier Li Qiang was presented with this information during his visit to the site.
On a different note, US and Chinese officials have reached a framework agreement on the continued operation of the TikTok app in the US. The details of this agreement are yet to be disclosed.
In other news, President Donald Trump announced that he would speak with Chinese President Xi Jinping on Friday. The topic of AI investments and their impact on the global tech landscape is likely to be a point of discussion.
Lastly, Alibaba raised $3.2 billion last week through a successful convertible bond, further demonstrating the strong financial position of Chinese tech companies in the AI sector.
As these developments unfold, the world watches with anticipation as China continues to shape the future of AI.
