China’s renewed top-level support for its private sector
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Hello and welcome to World Today, I'm Ding Han in Beijing. Coming up, Xi Jinping speaks to private sector entrepreneurs in a high-profile meeting.

China's Foreign Minister Wang Yi pledges that China will be a stabilizing force in a changing world. France is holding an emergency European summit in Paris to try to address the challenges posed by US President Donald Trump. Apple has picked Alibaba to launch AI features in China. To listen to this episode again or to catch up on our previous episodes, download our podcast by searching World Today.

Chinese President Xi Jinping has pledged steady support to advance the healthy and high-quality development of China's private enterprises. The Chinese top leader made the remark on Monday at a closed-door symposium with prominent private entrepreneurs in China.

Xi Jinping said the current challenges faced by private businesses are temporary and can be overcome, vowing to further improve China's legal framework and legal system to safeguard the growth of the private sector. The private sector contributes for more than 60% of China's GDP and more than 80% of the urban employment. So joining us now on the line is Dr. Yao Shujie, Chang Kong Professor of Economics with Chongqing University.

So thank you very much for joining us today, Professor Yao. Some people say this meeting on Monday signals a shift towards a renewed top level support for the private sector, which will likely reignite optimism about renewed growth momentum in China.

Some are even suggesting that it could be potentially more powerful than fiscal stimulus if policymakers show more concrete and decisive support towards the private sector in China. What is your take? The meeting has sent a very powerful signal for the central government, particularly from President Xi Jinping,

and his colleague at Polybilo to support the private sector. Despite that over the last 10 years or 12 years, there is a sequence of government policies supporting the private sector. But I think the most significant support, the most significant show off this time is the meeting today, which is widely circulated in the media.

And there's lots of discussion about how the central government may be willing to support the private sector. I think this is a very significant step forward.

for the sector to support the Chinese economy long-term growth. So with regard to China's domestic economic tasks, such as boosting consumption or tackling the real estate industry slump, how much does showing support or supporting the private sector matter here?

Yeah, the private sector has become a very important driver and increasingly driver for the Chinese economy in terms of production, technological innovation, and there's also lots of other creativity, including new creativity in the AI system, the newly emerging industries.

I think China is facing quite a lot of challenges at the moment. As you mentioned, the housing bubble crash has been a significant block to the real economy in China.

But for me, I think this is a short-term shock. It's not underlying the long-term weakness of the national economy. Because the housing bubble has been developing for many years, I think it is time to have some significant adjustment. And this adjustment certainly has a very short-term or even medium-term impact on the national economy.

But the slowdown in the real estate sector actually is a great opportunity for the non-real estate sector to emerge, particularly the newly emerging industry and also technological related activities, you know, robust technology and AI development and so on and so forth. So it is a part of the adjustment process in my view.

And the supporting of the private sector is going to accelerate this process of industrial and production transformation in the longer term.

Now, then when it comes to China's external headwinds, especially additional tariffs imposed by certain countries on Chinese exports, to what extent do you think supporting the private sector here in this country can help mitigate the relevant pressure? Yes, look at the representative for the meeting. Most of the people are leading figures in the new technological sector.

And, you know, the international headwinds imposed by some other country, particularly America, about, you know, foreign trade tariff, this would certainly have a damaging effect for the real economy.

But the solution to this kind of external shock is domestic innovation. If China is able to create productivity through new innovation, it's not going to be totally dependent on foreign forces, then the domestic economy system would have a very powerful effect and a luxuriant capability.

to absorb this external shock.

And we see that over the last eight years or so, when the China-US trade confictions actually hasn't damaged China's export capability. But in the longer term, I think China's export advantage, driven by technological innovation supported by the private sector, is going to become a fairly virtuous circle, innovation, production, export.

And this kind of capability building heavily depends on the gigantic domestic market, heavily depending on the private sector is able

to continue to innovate and produce products which are highly competitive in the international market. For example, the new vehicle industries, the AI deep-seek, it's now moving to the forefront of the international market and technological frontier. So I think supporting the private sector is the key to all these kinds of development and solutions.

to this kind of international conflict. And of course, like you have suggested, Professor, China's rapid tech developments or innovation is most recently and notably represented by this domestic artificial intelligence model, DeepSeek.

and it has really provided investors with calls for renewed optimism about the long-term sustainable growth of the Chinese economy.

So, and of course, when we talk about DeepSeek, that's a private company based in Hangzhou, right? So can you elaborate more with regard to the role that the private sector is playing in terms of strengthening China's scientific or tech innovation?

Yeah, DeepSeq is a very good example. There are also many other examples we can mention, for example, like BRD, like the MetaTree and so on and so forth.

Now, you know, the private sector certainly has played a pivotal role in this process, but the private sector is rooted in the healthy development of the national economy, particularly the human power, the human resources that have been accumulated over the last four decades.

where China has developed a fairly large talent pool, which enables some of the talents to create miracles.

These miracles, particularly represented by Dipship, give the Chinese society, the Chinese industry, and also the Chinese engineers, significant confidence. The country has the confidence to confront with the competition in the international market, which is very important because

In some areas nowadays, we can say that China can be the frontrunner. They have to depend on everything in America, everything in Western Europe and others. We have lots of things which are parallel or even over-settled. The most advanced machine, the most advanced innovation in system.

This means that the Chinese engineers, the Chinese scientists and the Chinese entrepreneurs, they are able to do it if the country provides the right environment.

And this meeting is just to eject it to provide the environment to enable all these forces to come to the forefront to innovate, to take the country into a much higher step. So more specifically, Professor Yao, what kind of policy support do you think China's private sector

needs most urgently right now. A couple of years ago or several years ago, we are mostly talking about the private sector's difficulty, the difficulty they are faced with in terms of getting access to financing and loans, etc. Nowadays, when we talk about the challenges or the difficulties in this regard, are we still talking about the same issue? Yeah, I think we are more or less talking about the same issue.

Over the last four decades, China made a huge progress in terms of combining the state-owned sector and the private economy together to create the world's largest economic miracle. But over the process, there's always some inequality, some unfair treatment against the private sector, particularly the smaller and medium-sized and micro enterprises.

Now, for the bigger firms, maybe they are not so disadvantaged. The disadvantage they face is because of the ownership nature. You know, there's an ideological debate about state-owned and private sector and the role that different sector can play and how the profit they can make for individual and for the country and the society and the general people, the employees and the general society.

Now, we understand all these differences. The problem is the society, the government, and also the general sentiment that a socialist country, how can we accommodate and use the private sector to prepare economy development while also creating social equality and justice? So this means the legal framework is very important. So what the private sector needs

First of all, they should be legally recognized, and the entrepreneurs and also the private sector have to be protected heavily, rather than facing uncertainty. And secondly,

In terms of financing, I think much of the financial resources are controlled by the state-owned banks and the related state companies. So there are two possible reforms to be deepened. One is that the state-owned financial sector, they should be treating the private and the state-owned sector equally.

on a level playing field. And secondly, maybe China at some stage should be encouraged more financial sector to develop and also help the private sector itself.

Now, certainly the legal system has to be strengthened. I mean, whether it is private sector or public sector, they got to be protected by the government, by the legal system. And firstly, I think in terms of law enforcement, there shouldn't be any discrimination between the public sector and the private sector.

If the private sector makes some mistake or some illegal act, then they should be prosecuted in a fairly way. So this kind of legal system and the information of the law and regulation is also fairly important. They need to make transparent and become the national policy built into the country's institutional establishment.

Thank you very much for your analysis and for joining us today. That was Professor Yao Shujie joining us from Chongqing University. Coming up, China pledges to be a force for stability in a changing world. Stay tuned. You're listening to World Today. I'm Dinghan in Beijing.

Chinese Foreign Minister Wang Yi has pledged that China will be a stabilizing force in a multipolar system. The senior Chinese diplomat made a remark at the Munich Security Conference held in Germany, saying China advocates equality among countries, respects the rule of international law, practices multilateralism, and upholds openness and win-win cooperation.

Wang Yi expressed confidence about the outlook for China-U.S. relations but also vowed a resolute response if Beijing faced unilateral bullying practice from Washington.

Wang Yi also said that China would like to witness all efforts conducive to the peace progress in the war in Ukraine, including the recent common understanding between the United States and Russia. Wang Yi also called on the international community to support the Chinese mainland's reunification with Taiwan.

So joining us now on the line is Professor Wang Yiwei, Director of the European Studies Center with Renmin University of China. Thank you very much for joining us. Thank you.

So, first of all, Professor Wang, what do you think makes China a stabilizing force in a multipolar world order? And what do you think those few principles elaborated on by the Chinese foreign minister in Munich conference tell us about China's view on multipolarization, for example?

Well, I just came back from Munich, I listened to Minister Wang Yi. Just after the Vice President of the United States went, the European colleagues told me, it seems like the U.S. is from the Mars, China is from the Venus. It's a totally different tone of the diplomatic, you know, expression. So why we say Wang Yi emphasized China's stabilizing force? Because our culture, actually.

different with the U.S. In all the panels that raised these very popular questions about whether China is the inward developing country or China's intention to replace U.S. as the hegemonic power, I replied, U.S. is a chosen people. God bless America, like J.D. Vance, the last sentence he even delivered in Munich. China, with Buddhism, Taoism, and computing, three representatives of Chinese culture,

Buddhism is more focused on you and yourself, your heart relations in this regard, inward looking. And Confucianism is more focused on people's, you and others' relations, and Taoism is you and the man and the nature relation. So this is our DNA, not chance, 5,000 years, right? And for Chinese development, we have the peaceful rise.

China's major driving force for China is innovation or development because we will have a better life for the Chinese people. Now we have 400 million middle class. By 2035, it will be double, 800 million. So we need innovation. We need a peaceful environment. So that's the reason I think I want to emphasize China's stabilizing force. When he mentioned about China's views on the multi-polarization, firstly,

Firstly, it will be equal. So-called the US alliance system is the other dependence on US. If they cannot guarantee the value of the US, then they are uncomfortable like today's Europe. Secondly, it should be order. It's not a mean chaos, which European Union is very worried about that in history, it will not repeat itself. Thirdly, I think Chinese focus on the multiple world should be based on the open prosperity, so we call it growth, globalization.

So that's really the economic foundation for political structure. So regarding the China-US relations, Wang Yi said, quote, of course, we hope that the United States will work in the same direction with us. However, if the US is not willing, if it is bent on suppressing and containing China, then we have no choice but to play along to the end, end unquote.

So having heard that message from the Chinese foreign minister, do you agree that the bow is in the court of the United States when we talk about how the bilateral ties are going to develop in the near future?

Well, China and the U.S. are the two major economies in the world. China emphasized the globalization, economic globalization should continue, while the U.S. won't have the decouple, de-risk policy, or even have the American first. That's a different approach.

China is different with the U.S. allies. It's more impotent. And China also diversifies our export market. Now, the trade with the United States, only 11% of all the

Chinese trade with the world. So China actually is more confident. Even U.S. playing the tariff curve or any other withdrawal from the international society, China, I think, is most dependent to deal with and also more comfortable to deal with that. Many Europeans want to make an appeasement policy with Trump, and then I think China disregards, criticizes.

And then at this year's Munich Security Conference, we know significant amount of attention has focused on what role China might play in these peace negotiations or peace talks initiated by US President Donald Trump for the war in Ukraine. What message do you read from the Chinese foreign minister's relevant remark at the event?

Well, the Ukraine war, this is the third year, so it's more attractive to the participants from the Munich International Security Conference. The Europeans emphasize the two principles of the end of the war. Firstly, it should be the last, lasting peace. Secondly, it should be the justice peace. So, be the lasting peace, and that means not repeat again.

The Ukraine is very worried about if the ceasefire, make a deal with Russia, maybe when Russia will recover from the war and then will launch another attack to Ukraine or even attack more countries. So that's their worry about. But for the Chinese, we think about the last piece should be take a whole consideration about the international security arrangement.

particularly in Europe, should be indivisible of the security order, like the Helsinki spirit. Otherwise, the CISF is fragile. Second, so-called justice, that means to mutual concerns, all the concerns, whether Ukraine, Russia, even Europe, should be fully considerate.

Okay, so on the Taiwan question, do you agree with this point by the Chinese foreign minister that if somehow the sovereignty or national territorial integrity of our countries must be respected as part of a very important international principle, that also means that China's complete reunification should be supported as well.

Would you agree with this point? And by the way, if we take a look at another piece of recent news, recent development, how would you look at this very fact that the U.S. State Department has dropped the wording on its official website that says that the U.S. does not support Taiwan independence?

Well, there's a report in the Middle East Conference when I attended the Geoeconomy, saying about a double standard. The Europeans even accepted

There are many criticisms about the double standard. They say this is better than no standard. So when they think about the integrity of territory, sovereignty, ask China to pay China's debts, of course it should be consistent, including Taiwan and other Chinese domestic affairs. And then the U.S. takes a leading role to want to put the one-China policy actually to be...

In their explaining, they said that the three communiques, even the UN Resolution 2007-58, did not include Taiwan's position in the world. So they want to change this radical and then make, of course, an unstable situation across the Taiwan Strait. Hmm.

So the final question before we let you go, Professor, we still have about like one minute before we let you go. Another explicit message that China's foreign minister has sent at this conference in Munich is that China represents a trustworthy partner for Europe. What do you think such a kind of assurance from Beijing might mean to Europe right now?

Well, this is a Munich Internet Security Conference. At the beginning, so-called the Prime Minister of Japan, three years ago, said today Ukraine, tomorrow Taiwan. So they do not trust China in this regard. So in that conference, I made the presentation that

I recently was appointed as a consultant member of the 15 five-year plan of the Beijing University. In this border, we designed the 15 five-year plan without so-called

so-called use force. So that's, I think, guaranteed. And then China, actually, without so-called unification, China's still right. So I'm guaranteed to Europeans and other international community that unification, of course, is China's sovereignty. Yeah, indeed. So going forward,

A lot of things need to be sorted out. And I guess between Europe and China, we really wish the best of the hope for this bilateral relations going forward. But thank you very much for joining us. Professor Wang Yiwei joining us from Renmin University of China. We'll be back after a short break.

Welcome, I'm Elav Elad, economics professor and member of the Data Science and AI Center at New York University, Shanghai. On the World Today program, you can find in-depth and impartial insight, as well as critical commentary on key trends in the Chinese economy, financial technology, business and blockchain. To prepare for the world tomorrow, join me on World Today.

You're back with World Today, I'm Dinghan in Beijing. French President Emmanuel Macron is convening an emergency meeting of European leaders in Paris to discuss Ukraine and security in Europe. The crisis meeting includes Germany, Britain, Italy, Poland, Spain, the Netherlands, and Denmark, as well as the NATO Secretary General and the presidents of both the European Council and the European Commission.

The meeting is coming a week after US President Donald Trump held a phone call with his Russian counterpart Vladimir Putin about peace talks over the war in Ukraine.

U.S. Vice President J.D. Vance has also spanned the majority of his address to the Munich Security Conference held in Germany, criticizing European governments over migration and free speech, saying the greatest threat facing the continent is coming from within. So joining us now on the line is Dr. George Zagopoulos from CIFE, a France-based European research organization. Thank you very much for joining us.

Thank you for having me. So what do you make of the timing of this particular meeting in Paris? What's the main source of anxiety and fear for Europe right now? Well, to start with, the Europeans are concerned about the conflict in Ukraine and the policy of President Trump vis-à-vis this conflict.

However, President Trump is implementing his pre-election agenda. And the main reason why the meeting is taking place in Paris today is that a few days ago, two presidents, President Trump and President Putin, spoke on the phone. And the Russian and American delegations are about to meet in Saudi Arabia.

in the absence of the European Union. So this is the main reason for today's meeting in Paris, although, as I said before, President Trump is only implementing his pre-election agenda as far as Ukraine is concerned.

Why do you think we are currently hearing mixed messages from the Trump administration with regard to whether its proposed peace negotiations for the Ukraine crisis will involve European powers?

Well, the Trump administration is currently in the process of negotiating with Russia. So we do not know up to what extent negotiations and discussions will lead to a result. And we do not know if the presidents, President Trump and Putin, will finally meet. It depends on the work, the preparatory work of the delegations of the United States and Russia. So the United States...

is about to inform, obviously, Europe about what's going on. But at the same time, the negotiation is taking place only between the two powers, the United States and Russia. And this had been also the case before the beginning of the war in February 2022, because, again, the main players were Russia and the United States, not the European Union. So the same is happening right now. And from the moment, there is currently no breakthrough as far as a

peace settlement is concerned. This explains the fact that the messages that the American administration is sending are not very clear. So what is your overall impression and takeaway from J.D. Vance's address in Munich?

It had been expected earlier before the events that the US vice president would of course use his speech here to try to address possible negotiations to put an end to the war in Ukraine. That was the previous expectation, but why do you think he has instead spent the majority of his time in Munich

accusing European governments of retreating from their values, for example, and ignoring European voter concerns regarding migration and free speech.

This is a very good question. Again, I see continuity in the approach of the Trump administration. Continuity not only in relation to the pre-election campaign and the pre-election agenda, but also continuity concerning the previous Trump administration. Because the Trump administration does not really value EU's role in the world. On the contrary, it is prepared to work together with member states.

So it is within this context that the message that Vice President Vance said in Munich can be better explained. So I would say that we are currently having a new American government which has a clear agenda as far as political ideology is concerned. And this clear agenda also is in line with some political parties in Europe. And the American administration wants to work together with those parties.

So this is the message that Vice President Vance sent a few days ago in his first speech in Europe. So at a time when, as we can tell from this meeting in Paris hosted by Emmanuel Macron, at a time when Europe is having a sense of crisis due to multiple factors, what do you think the EU's strategic partnership with China might mean to the bloc moving forward?

Well, I would say that China and the European Union can build together a multilateral world. And obviously, this is a general trend which

is applicable irrespective of the speech of Vice President Vance and irrespective of Donald Trump coming to power in the United States. But obviously, with the new American foreign and economic policy taking shape, it is evident that the European Union and China will perhaps have

have the opportunity to work together on several issues and on different fields, as it also happened during the first Trump administration. So China and the European Union, I believe that can foster collaboration. In my opinion, the partnership happens

is moving forward and we will have the chance to see more things to happen in the next years. And problems and difficulties have been managed. It is true that the two sides disagreed in the past, but again, it's important to see the glass as half full and I believe that the two sides can achieve significant results if they work together despite differences.

Thank you very much for joining us. That was Dr. George Zagopoulos from CIFE, a France-based European research organization. Thank you very much for joining us. Coming up, Cook Islands Prime Minister defends signing of a wide-ranging deal with China. We'll be back after a short break. Hello, my name is Alessandro Golombievski Teixeira. I'm a professor of public policy management at Tsinghua University in Beijing.

I am a great listener of The Wall Today. In my opinion, The Wall Today is one of the best China radio programs.

In The World Today, we can get the best news and analysis in what is happening now in the world. So please come to join us. You are listening to World Today. I'm Ding Han in Beijing. The Prime Minister of the Cook Islands, Mark Brown, has defended a new agreement with China, saying it aligns with the country's long-term interests.

Brown made the remarks after returning from a five-day state visit to China, highlighting the deal's focus on trade, investment, ocean science and infrastructure.

He stressed that the ties with China complement the Cook Islands' relationships with New Zealand and the partners beyond. Diplomatic relations between China and the Cook Islands date back to the year 1997. Bilateral trade has since grown, surpassing US$12 million in the first 10 months of 2023, a 9% increase year-on-year.

This cooperation deepened back in the year 2018 when the Cook Islands joined the Belt and Road Initiative. So for more on this developing story, my colleague Ge'an Na earlier spoke with Dr. Zhou Mi from the Chinese Academy of International Trade and Economic Cooperation.

The Prime Minister of the Cook Islands, Mark Brown, has just concluded his one-week visit to China from February 10 to 16. Could you please share with us the details of his trip? Which cities and projects were the focus of his visit this time?

Yes, we know that Cook Island is a little bit far from China. So when he came here, he has spent quite a while in China. I don't think it's no wonder because China is a big country. So he went to the three provinces and cities like in Heilongjiang to attend the Asian sport games. And also he went to the Shandong and

went to Shanghai. I mean, in Shandong, he may try to experience some of these marine economies to do with the city of Qingdao. And in Shanghai, I think he also take a lot of activities to look at the development of some of the economies and some of these new energy companies.

I think that is a very full agenda for his visit because both sides are doing a lot of discussion. And also, I think that one of the priorities for his visit is trying to learn more about China's experiences on the poverty reduction, which is one of the very important issues even for the country of Cook Islands.

The Cook Islands has officially signed a bilateral agreement with China, marking a deepening of ties between the two nations. What is the significance of this agreement in your opinion, especially in the context of the Pacific Islands' geopolitical landscape?

We know that South Pacific countries are not a very big one, but they are very widely scattered. So the cooperation with the main economies in the world is very difficult. So in the past, because the communication and also a lot of interactions are not so good, they can only do some of the business with China, such as in some infrastructure cooperation and also in tourism.

So this time, I think that it's really a good opportunity for Cook Islands to know more about China, about the ways and also the death of the Chinese economies. So we have signed a cooperation development for the plan for so many areas, including, you know, the trade and investment, the tourism, the marine science, aquaculture, agriculture, transportation, and also infrastructure.

And we have paid a lot of attention on Cook Islands' willingness to improve its resilience in the climate change and trying to prevent the disasters. So it is really a wide range of cooperation. We cover so many areas. And I think it's very important for both sides to know that

for the development in the coming future. We have so many things we can imagine. Could you please elaborate more on the agreement? From Cook Islands' perspective, what specific benefits does the island country hope to gain from this agreement with China, and how does it align with the country's broader development goals?

Well, we know that China is the number one country, I mean, for the development speed in the previous decades. So if they are going to be connected with China's economy, I think there are so many things for the resilience. China is one of the main partners

producer of the manufacturers and also we have so many big markets and we want to import more things from cook islands and other south pacific country we know that cook islands is uh you know uh several uh about 15 15 islands in that country and they do not have so many natural resources but they have some of some of the possibilities like for the marine economies

So they are developing most of the economies by the tourism and they want to be able to be more independent on the economies. So the cooperation between these two countries are really giving a very strong consumption and support for the, you know, the development of this economy of the Cook Islands. And it is important because we need to know that the economic ties should be strengthened based on the market.

So for both sides, we are able to support the Cook Islands with more new energy abilities to try to support them, not for the consumer, but also for the development of the economies and other areas. And we also are able to provide better abilities for infrastructure, like for the airports, for the ports, or a lot of other areas like the telecommunications. So in my understanding, that cooperation with Cook

Cook Islands are really important for us to improve the connections in these areas. And it's a very important one because diversification is one of the possibilities for Cook Islands to give a better performance. Then what role does China envision for the cooperation with the Cook Islands in its wider relations with the small island nations?

Yeah, actually last year I went to New Zealand to attend the Track 2 discussion or dialogue and we also have some discussion with New Zealand about the possibilities of cooperation between China and the South Pacific countries. We know that the Cook Islands is one of the three nations that has an association with New Zealand, but they are not able to provide a better and very strong market.

So in my understanding that performance with Cook Islands is also important for us because we want to strengthen the cooperation with the South Pacific communities. So with Cook Islands, it's just one example so we can improve the regional cooperation and trying to make a better use of the resources and deal with the problem like to fighting against the climate change and improve the resilience of the development.

So for China, I think that is also a lot of possibilities for us to give the companies of Chinese companies and also the local companies more opportunities for cooperation. And it is not just trying to fight against the third party.

So even with New Zealand and even Australia, I do believe that we do have so many possibilities for the cooperation and we can improve the better abilities of the logistics and also provide a better and more efficient ways for the two ways communications and improve the resilience of the culture also.

Speaking of that, when discussing China-Kuuk Island's cooperation, many foreign media outlets are focusing on how this partnership might impact the region's relationship with other powers such as the United States, Australia and New Zealand, as you mentioned earlier. What are your thoughts on such a focus and the related commentary?

Well, it is very interesting because when we're discussing the problems of the bilateral relation between China and Australia, China and New Zealand, they are experiencing some of the worries about, you know, the so much dependent on the economy of China. But when we discuss about the South Pacific countries, they seem to neglect the possibilities of diversification. So I think that the corporation is trying to give some more opportunities. The decision power are

are still in the hands of the South Pacific countries, they do not have to worry about the possibilities because if we are looking at the market, as a market principle, I think that people are able to do their choices. I don't think that we are forced that some other countries to do something. They are just the

giving more opportunities. They can choose by themselves. It's very fair. So we can even try to cooperate with Australia and New Zealand in those countries also if they want, and if the people of those countries also want. There is no such kind of thing of just picking one from two. Dr. Zhou Mi from the Chinese Academy of International Trade and Economic Cooperation talking to my colleague Ge'an Na. You are listening to World Today. Stay tuned.

You are listening to World Today, I'm Dinghan in Beijing. Alibaba is partnering with Apple to roll out artificial intelligence features for iPhone users in China. AI integration is critical for iPhone, which faces declining sales in the key market. Alibaba sees the partnership as a major win in China's competitive artificial intelligence market.

So for more on this latest development, my colleague Zhao Yang spoke with Professor Qu Qiang from Mingzhu University of China. So Professor Qu Qiang, so first, why Apple has gone for Alibaba over other Chinese AI companies for this partnership? Why did they choose them? Well,

Well, I think Apple is probably one of the most important tech companies in the whole world with global influences. And I think in China, the company who is worth to be their counterpart is basically only Alibaba and Tencent. But I think for the consumption part, I think only Alibaba can match Apple's demand. I think number one is about the data resources and localization capability. Because Alibaba as one of the most important e-commerce giant and also the e-payment giant is

have accumulated lots of the behavior data of the consumers. For example, like the consumption, like the payment habits. And also I think Alibaba right now has been emerging very quickly in AI model. And I think secondly is about Alibaba's big model, a large language model. I think it's called the Tongyi Qianwen. It's based on the QWEN 2.5 Max model. And I think this is also a very, very important reason for that.

It's not only because of its good performances, but also I think it's very cost-effective. And also I think certainly it's about their experiences and infrastructures. Alibaba, well, people well know them as an e-commerce company, but the more you have to understand that they are one of the largest, you know,

cloud service cloud computing service providers in China So you will see their servers their infrastructures probably leading so I think those based on that reasons I think that's a reason why they choose a leap up to be their strategic partner And is it going to save the iPhone sales though?

Well, I think to some extent, I think Apple is very good in the hardware, but I think they're in localization and customized services providing for the Chinese customers. They're absolutely lagging behind like Huawei, like Xiaomi. So I think what's the strategy for Apple right now in China is absolutely localization and also to meet the demand of the local customers in China. I think

um alibaba absolutely have this uh humongous experience in this area so i think uh through this uh cooperation they will absolutely use ai well ai is just one of the perspective but they will use many other perspective

to meet the challenge with Huawei, with Oppo, Vivo, Xiaomi and etc. So I think they probably will provide some other customized version of Apple in Chinese market to meet the demand and face the challenge. And what about it for Alibaba? What does it mean for them and for the broader AI market in China?

Well, I think for Alibaba, I think this is absolutely one of the most important opportunities. Alibaba's stock price, if you're following them, I think has been slowing down for many years. But right now, if you read the analyzed report from the Goldman Sachs, from many of the investment banks at UOC, they responded very positively towards this opportunity because

Apple has been providing the hardware, and basically it's more than just a hardware. It's more like an entry, more like a window towards the whole world. So I think with this marriage of the technology and a business model, it will absolutely help Alibaba to –

to make this AI technology to be materialized, to be actually put in the actual use. And also, I think Alibaba has been famous in the Chinese or grand Chinese circle, but right now has been bonding with Apple. I think this is a major up

in the evaluation and brand name of Alibaba. So you will see that after this announcement, Alibaba's stock price has been rising. This is just the beginning. And also, I think this is a strong push for not only Alibaba,

but also for the whole AI market in China. It will be serving as one of the benchmark in the whole industry and also will help to open source in China. Because right now, I think Alibaba also are following the open source model. And right now, I think with the, because Apple also have a very large community for the developers. So I think this will push forward the Alibaba open source circle and the developers communities as well.

And some data show that China saw a 36% increase in the AI market last year, while the debut of DeepSeq generated further enthusiasm. So how do you view China's AI development, its market and applications? Why can they develop so quickly? And will China's open source model become the trend in the global AI development?

Well, I think China will absolutely have the government support and both the government support and the market demand because we have one of the largest markets in the whole world with 1.4 billion people and 500 million rising middle income class. And they are very, very familiar with smart consumption based on AI, based on the e-commerce and based on e-payment. And

If you are familiar with the Chinese market, I think China probably is the largest market based on the globalization/digitalization. So I think the whole market has been trained very well. And I think secondly, it's about the government policies. We have 14 five-year program and now we'll be making the 15th five-year program. And I think according to the Chinese government, top-notch design.

I think AI is absolutely one of the focus and more than that, I think we have been focusing on the infrastructures like the computational power, like the data, like the server and all those and also the 3G, 4G and 5G network and 6G network has also been very much focused in the past five-year programs. And also I think secondly, it's about Chinese company have a very different, you know, a

a notion or opinions on this development for example open source when the uh open ai are following the closed source uh strategy but you know alibaba deepseek and all these big giants in ai they followed open source strategy this has been much lower than this cost and

Also, they've been pushing forward the whole community of the developers and make these popularization of AI has been going very fast. And also, I think what's behind that is a long-term strategy of the government

in nurturing the STEM talents, the science and technology, mathematics, and all these has been a long strategy for China for a very, very long time. So I think the very large fleet of the engineers actually is behind all those development. We call the engineers a bonus, has been supporting China to grow very fast in not only this AI trend, but also in the past trend like the mobile internet, like the e-commerce, digitalization, and etc.,

And talking about Hangzhou, this eastern Chinese city in Zhejiang province, it is the home to Alibaba and DeepSeq, also AI robotics companies, a lot of them, and it is the home to the sixth little dragon. So why is this city full of high-tech innovation capability? And can the Hangzhou model be replicated?

Well, yes, I think the reason why Hangzhou has been leading in this round of the technology breakthrough, I think this is very, very sure. Number one, I think they have the giants as a leading force. For example, Alibaba has been rising up in Hangzhou and Alibaba has been, you know, building up very good infrastructures for Hangzhou. For example, if you go to Hangzhou, you'll find out that the whole city's, you know, transportation has been controlled with what we call the smart brain infrastructure.

Every traffic light has been controlled with this smart technology, with algorithms. So it will largely reduce the congestion in the whole transportation network. This is just one example. It shows you how much of the technology infrastructure has been built in the city. And secondly is the talents.

has been spilled over from the company like Alibaba. Many of these smart engineers, they have been acquitting Alibaba, started their own companies and forged a very good ecology in the talents. And also it's the policy and whole ecology because I think the city government of Hangzhou actually has been using many very good policy combos to try to nurture all these companies. For example, tax rebate.

For example, like the government-funded incubators. For example, like the strong funding for the local universities, like Zhejiang University is a very important university in not only Hangzhou, but also in the whole China. And also, I think that Hangzhou has been trying to create a whole ecology, you know, combining different companies. They encourage those companies. For example, if you are manufacturers, and then we'll create a platform for you to communicate with, like the...

Professor Qu Qiang from Mingzhu University of China talking to my colleague Zhao Yang.

That's all the time for this edition of World Today. A quick recap of today's headline news: President Xi Jinping speaks to private sector entrepreneurs in a high-profile meeting. China's Foreign Minister Wang Yi pledges that China will be a stabilizing force in a multipolar world order. France is holding emergency European meetings in Paris to try to address the challenges posed by US President Donald Trump.

To listen to this episode again or to catch up on our previous episodes, download our podcast by searching World Today. I'm Dinghan in Beijing. Thank you so much for listening. Bye for now.