“Although mostly unknown in the West, Digital China has enormous implications for China’s developmental path, great-power competition, and the norms that will undergird the international system for decades to come.”
David Dorman, “China’s Plan for Digital Dominance,” War on the Rocks, March 28, 2022
Digital transformation is all the craze in China. Even the venerable Kweichow Moutai distillery now talks of the new digital processes necessary to brew a smarter liquor. But all of this only reflects the popularization of a long-running Communist Party initiative of far greater strategic significance. Over the past two decades, General Secretary Xi Jinping has been at the center of party efforts to create a comprehensive digital strategy of immense proportions, known as Building Digital China (建设数字中国), or more often simply Digital China. While sounding much like an industrial strategy, Digital China is never described as such internally. In broadest terms, it is a major strategic decision made by Xi Jinping in the aftermath of the 18th Party Congress in 2012 to digitally transform the nation. For the more technically minded, it is the overall strategy for national informatized development in the new era. Although mostly unknown in the West, Digital China has enormous implications for China’s developmental path, great power competition, and the norms that will undergird the international system for decades to come.
As a concept personally tied to Xi, one might argue that not only has he made Digital China a key to national success, but that Digital China has also contributed to his individual success, as the concept has tracked his rise for more than two decades. Xi first adopted the precursor concept of Digital Fujian from a local academic while serving as deputy party secretary and governor of that province in 2000. It was originally conceived as a simple effort to use new and emerging digital technologies to improve local governance and improve economic efficiency — in essence, China’s first experiments in e-government. Xi Jinping’s Digital Fujian would evolve and expand over the next 20 years before finally reemerging as the party’s vision for a fully informatized Digital China: a sharp weapon that empowers the nation (improved national competitiveness) and a spring rain that benefits the people (improved operating efficiency of society).
Surprisingly, a strategic initiative of this size and scope has progressed mostly unnoticed in the West. Perhaps more surprising, even the most concrete elements of the strategy remain obscure outside China. At the onset of the pandemic, Xi Jinping directed the Communist Party to accelerate an infrastructure campaign of epic proportions in support of Building Digital China. This campaign, known in China as New Type Infrastructure (新型基础设施), is to receive an estimated 17.5 trillion yuan (nearly $2.7 trillion) over five years exclusively for the purpose of digitally transforming traditional infrastructure and building new digital infrastructure. As outlined in April 2020 by the National Development and Reform Commission, the state’s top macroeconomic planning authority, New Type Infrastructure falls into multiple levels and categories including the construction of an industrial internet, the building of a national dual gigabit network (integrated 5G mobile and fixed gigabit optical), the building of a satellite internet network, as well as the recent official launch of nationally integrated system of big-data centers. More broadly, Beijing describes the campaign as becoming the key support and important material guarantee for a new revolution in science and technology and a new round of industrial transformation. Simply stated, this plan is a pivotal part of China’s effort to dominate the Fourth Industrial Revolution.
Beijing also believes that the technology, manufacturing, and domestic subscribers arising from New Type Infrastructure will drive mutually reinforcing growth in China’s international trade and inward investment, a competitive trajectory and exemplar of the Communist Party’s new dual-circulation economic strategy. Xi introduced building a new development pattern based on dual circulation between domestic and international markets at a Politburo meeting in May 2020. Designed to respond in the short term to structural changes impeding China’s economic development, principally COVID-19 and barriers to high-technology imports, the pattern calls for a primary focus on the innovative expansion of China’s domestic economy, which in a hardening external environment would also serve as the principal driver for China’s continued access and expansion into international markets, in effect dual circulation. Former Vice Commerce Minister Wei Jianguo went so far as to describe New Type Infrastructure as core to building the dual-circulation new development pattern and further linked Xi’s vision to accelerate New Type Infrastructure construction using the strategic window opened by the COVID-19 pandemic to the origins of the dual-circulation concept itself.