AI set to boost China’s business environment, new survey finds
More than nine in 10 (92%) of Chinese business leaders believe generative artificial intelligence (AI) is more of an opportunity than a threat, displaying more optimism about AI that their foreign corporate peers, according to a new report from consultancy firm Accenture.
The report indicated that company executives worldwide ranked generative AI and associated technologies as the top factor affecting business transformation, with 77% of Chinese enterprises surveyed saying generative AI is more beneficial to revenue growth than cost reductions.
The Accenture survey also found that 80% of Chinese business leaders expect revenue growth to speed up this year, higher than their global peers (68%). Despite their optimism, 62% said they are not fully prepared to respond to the challenges their businesses face.
Jack Azagury, group chief executive of strategy & consulting at Accenture, said: “We believe that the companies that will succeed in the next decade are those that embrace a strategy of continuously reinventing every part of their business using technology, data and AI, including harnessing the power of generative AI, and ensuring their people are at the centre of their transformations.”
The research surveyed more than 3,400 company executives between October and November 2023, including 260 from China from 20 industries,.
In its latest Technology Vision 2024, Accenture said that AI and other disruptive technologies are becoming much more human-like and intuitive for people to use, “ushering in a new era of unprecedented productivity and creativity”.
It said about 40% of all working hours will be supported or augmented by language-based AI, adding that generative AI has the potential to enable productivity enhancements across 900 different types of jobs and create at least $8 trillion in global economic value.
The report comes as China’s State Council – China’s cabinet – announced it is rolling out a raft of policy measures to advance the deep integration of AI with manufacturing, with a key focus on smart manufacturing.
The country’s AI industry “will make great strides in the next 10 to 15 years”, being worth 1.73 trillion yuan ($241.3 billion) by 2035, and accounting for 30.6% of the world’s total, according to market research firm CCID Consulting.
Pan Helin, co-director of the digital economy and financial innovation research center at Zhejiang University’s International Business School, said although generative AI technology boasts significant potential for applications in a wide range of sectors including culture, retail, healthcare and education, its real value comes from the consumer market.
“The process of training large AI models necessitates higher requirements for computing capacity, algorithms and quality of data,” Pan said, adding that Chinese AI firms should boost investment in basic scientific research, including math, statistics and computer science, to gain a competitive edge over international rivals.
Investors satisfied with Chinese investment
More than 80% of foreign-funded companies in China are satisfied with the country’s business environment, according to a survey by the China Council for the Promotion of International Trade.
Carried out in the fourth quarter of 2023 among nearly 600 businesses, it revealed that more than 90% of the respondents find the Chinese market highly attractive, and almost 70% expressed optimism regarding market prospects in the next five years, said Yang Fan, a spokesperson for the Council.
“The fundamentals of the Chinese economy will remain stable and sound in the long run, and ‘the magnetic attraction’ of the Chinese market for foreign investment will become stronger,” Yang said.
Of the foreign companies surveyed, 68% were micro and small firms, with 65% engaged in processing and manufacturing in China.
The survey found a sustained improvement in foreign enterprises’ satisfaction with China’s business environment during the fourth quarter. More than 90% of firms surveyed expressed satisfaction with market access, taxation and commercial dispute settlement.
Yang said that over 90% of the surveyed companies expect their profitability to either remain at the current level or increase in the next five years, while more companies, compared with the third quarter, have plans to increase their investments in China.
