Official Warning: China Calls for Regulation of Investment in Artificial Intelligence

In a move reflecting a cautious strategic direction, China has called for curbing "excessive investment" and "random competition" in the artificial intelligence sector, despite its classification as a key driver of national economic growth and a critical competitive field with the United States.

Chang Kailin, a senior official at the National Development and Reform Commission - the highest economic planning body in the country - confirmed that Beijing will take a coordinated and integrated approach to developing artificial intelligence across various provinces, focusing on leveraging the advantages and local industrial resources of each region to avoid duplicating efforts, warning against "herd mentality" in investment without careful planning.

These statements come amid a contraction in China's manufacturing industries for the fifth consecutive month, reflecting the pressures faced by the world's second-largest economy, as policymakers attempt to avoid repeating past mistakes like those in the electric vehicle sector, which led to an oversupply of production capacity and subsequent deflationary pressures.

Chinese President Xi Jinping also warned last month against the rush of local governments towards artificial intelligence without proper planning, a clear indication of the Chinese leadership's desire to regulate the pace of growth in this vital sector.

Despite these warnings, China continues to accelerate the development, application, and governance of artificial intelligence, as the government revealed a new action plan last week aimed at boosting this sector, which includes significant support for private companies and encouragement for the emergence of strong startups capable of global competition, which the National Committee described as a pursuit for the emergence of "black horses" in the innovation race, implicitly referring to notable success stories like the Chinese company DeepMind.

DeepMind gained international fame earlier this year after launching a powerful and low-cost artificial intelligence model, competing with the models of major American companies, igniting a wave of local and international interest in Chinese technologies.

In a separate context, a Bloomberg analysis showed that Chinese technology companies plan to install more than 115,000 artificial intelligence chips produced by the American company Nvidia in massive data centers being built in the desert regions of western China, indicating a continued effort to build strong artificial intelligence infrastructure despite regulatory constraints.

These steps come at a time when Beijing seeks to balance support for technological innovation with regulating investment chaos, in an attempt to shape a more sustainable path for the growth of artificial intelligence within China's broader economic vision.