Unpacking China's 2025 government work report: What's backing the 5% growth target?
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Hello and welcome to World Today, I'm Zhao Ying. Coming up, China targets economic growth of around 5% in 2025. How achievable is this goal? European Commission President Ursula von der Leyen has proposed an €800 billion plan to rearm Europe. Does this mark a turning point in transatlantic relations?

China has set its GDP growth target for this year at around 5%. Premier Li Qiang announced the target in his government work report at the annual session of the National People's Congress. The report also outlines an array of other development goals, including a surveyed urban unemployment rate of around 5.5%, over 12 million new urban jobs, and an increase in the consumer price index of around 2%.

The premier also pledged support for the development of new quality productive forces and AI. China will make domestic demand the main engine of economic growth and will issue actual long special treasury bonds to support its consumer trade-in programs.

For more, we are joined by Dr. Zhang Gong, professor with the University of International Business and Economics and Honor Tianjin Senior Fellow at the Taihe Institute. Professor Gong, let me start with you. China is aiming for a 5% growth rate in 2025. What

Well, given the global uncertainties like U.S. tariffs and some domestic challenges like the property market, how confident are you that China can hit this target? Well, actually, before they announced the target, my guess would be China.

5% actually, so I was actually pretty much on target. What they announced is about 5%, I think. I'm still very confident that it's a target that is within reach, judging by the statistics that we have seen so far into the beginning of this year. For the first two months of the year, it's a fairly solid performance. I think it's pretty clear that China's economy is starting to recover.

Even when we talk about the real estate market, we're seeing signs that some cities are seeing prices coming back a little bit. So this is actually a very good development against the backdrop of a massive package of fiscal and monetary policies. And I think the most important of all is the decision to issue a very large amount

amount of central government debt to bail out local governments. And I think that's a decisive move. And I think the effect is starting to percolate down and starting to take effect.

Now, of course, you mentioned the challenges, especially related to the geopolitical situation, Donald Trump's protectionist move. That's a fairly large challenge. But first of all, I think there might be a chance that something can be worked out. And second, I think even if at this very high level of tariffs, the exports market in the United States is still a small percentage of China's GDP. So I think the risk is manageable and the impact can be potentially minimized.

Okay. Well, Einar, how would you assess this 5% growth target? And what might be the biggest wild card? Well, I agree with John. I think it's very doable. China is not like the U.S. or Europe. They have a lot more tools in their toolbox. They can do direct things. For instance, they're increasing demand.

the number of expenditures by offering rebates on household goods. So they have the ability to directly influence consumer spending. That's one part of it. But I think the main reason I think it's, well, I have two reasons. One, Donald Trump is bluffing. And the reason I say that is, let's just take one area where he's imposing 25% tariffs, and that is the steel and aluminum industry.

industry. Well, if you look at the U.S. market right now, the last aluminum factory built in America was 40 years ago. Steel and aluminum capacity is utilization. I mean, how much of the existing capacity is being utilized is above 90 percent. That means that there is no way you don't you don't start up a factory in two days and start producing aluminum or steel. It takes many years to do so during that period.

You know, consumers, anybody who touches a Coke can or buys a car is going to pay more. And that will not make people happy who are already very upset about the price of eggs, gasoline and the fact that with all of these tariffs he's put on Canada, Mexico and China, not including Europe.

That's going to add about $1,100, according to the Taxpayers Association, which is nonpartisan. So it's a bluff. He's trying to convince the world he has four aces, and actually, he has none. He cannot hold out long term. He's not ideological, so he's going to turn on a dime.

The second part is within China itself. And that is there is a new wave of confidence, whether you're talking about the Wukong video game or the

blockbuster Chinese film that came out or Deep Seek. There's a new sense within China that China can do all of these things by itself, that it's not going to be hemmed in by the United States and its containment policies, and that it can go forward. And this is the most important part. So confidence within China and a big bluff by Donald Trump on his tariffs. And I think China will do very well. In fact, I would imagine it will do better than 5%.

Okay, well, Professor Gong, the report sets a 2% CPI target, which is lower than in previous years. What is the signal about China's approach to inflation and deflation risks in 2025? Yeah, well, 2% inflation rate is generally considered in the economist community as probably

but practically no inflation. It's a little bit of inflation is actually quite healthy. Now, in 2024, actually China's inflation is even lower than that. I think it's more like a 0% actually, if not even negative, if I remember this correctly. So getting to 2025, the economy is heating up a little bit, things are coming back.

So you would expect that inflation would be coming back a little bit, given the monetary policy, fiscal policy being implemented over the months. So I think that target of 2% is generally quite healthy. But to be honest with you, I suspect, I have a hunch feeling that we're probably gonna see a bit of inflation into 2025. The problem is that

Clearly, in my view, the dollar is experiencing an inflationary cycle. I think there's going to be inflation in the United States. There's no doubt about it. We're already seeing very rapid and quite large price run ups of certain products, even

Daily necessities important to people's lives. So, and in dollars, inflation tends to be exporting. It can cross shore onto other countries. I think that's a quite important factor that needs to be taken into consideration.

There's also the issue of, as I just mentioned, monetary policy, stimulus package, those things tend to have an inflationary effect. I think on the inflation side, if we can maintain 2%, it's very good. The government has this target in mind. I think it's a good target, but I think there's some challenge there. I think the inflationary pressure is going to be increasing as we move forward.

It's not easy to achieve that goal, in my view. So we have to see whether we should be able to manage this issue successfully. Okay. So Einar, how do you see this inflationary pressure and what do you make of this choice of 2%?

Well, I differ a little bit with John on this. I do see it as a struggle. Last year, they targeted 3%, and it was actually a little bit deflationary. It's just above zero. And I think they recognize that increased competition, lower global demand because of what the United States is doing, which could push us, literally push the world towards a recession or even depression if he continues with these tariffs. As I said, I don't think he will.

But there is this factor of competition, which is just fierce in China. And this is one of the ironies.

China is one of the most capitalist countries in the world when you get down to a company versus company. And as a result of that, I do think there will continue to be some pressure on existing capacity as that goes down. Some companies will go out of business. Other companies will cut prices. There's a point at which they cannot cut prices anymore. But I think it is a bit of a struggle. I agree with John. 2% is...

Basically, the ideal-- you'll recall that the Fed is always saying that they want 2% inflation because that's the happy part where you have a little bit of inflation but not too much. And it kind of stimulates the economy. So I do think China will be aiming at that. There will be some inflationary pressures coming from abroad in terms as China moves its agricultural

sources away from the United States. The point there is that there are a lot of countries out there that can supply the U.S. It's not a situation where you walk away from the U.S. and you have no supply. And remember, like oil, agriculture is fungible. If you're not buying it from the U.S., you buy it from, you know,

from Brazil, and then the people who were buying from Brazil will buy from the United States. So it's just a kind of game of musical chairs. But it can increase logistics costs if there is an existing-- if it's not as easy to get across. But that's a small amount in the overall scheme of things. But that will be somewhat inflationary.

Well, Professor Gong, the report also aims for over 12 million new urban jobs and an urban unemployment rate of around 5.5%. How feasible is this given the record 12.22 million college graduates entering the job market this year? I think this is a very achievable goal.

Again, I remember in 2024, China's economy created 12.5 of 12.6 million jobs. So it's actually a reduced target compared to 2024. And given the fact that we should be expecting a

in my view, a bad economy this year than last year's, at least I think we're not gonna see the slowing down in the second, third quarter for this year. So given that prospect, I think the new jobs being created should be at least comparable to

what has been created last year. Now, the problem is that, you know, we have this new technological revolution, you know, we're starting to see more and more robotics being used, AI replacing jobs, that kind of thing. So it's just a big challenge, I think, the challenge coming from the technology space. So, but, you know, I,

Again, I will say that in history, usually new technology doesn't kill jobs in aggregate. I mean, they kill some jobs, but they quit even more jobs. So in aggregate, there's never been a time in history that the aggregate jobs actually being reduced dramatically. So I would expect the same thing would happen with respect to this AI movement. So I think 12 million jobs is something should be fairly easily within reach.

And the 5.5% urban unemployment rate, it's also very close to a very healthy unemployment rate. Usually, I think from an economist perspective, below 4% is generally regarded as full employment. There might be structurally existent unemployment rates. It's part of the labor market frictions. It will just adjust.

very quickly and these jobs will be found and people will find their jobs. So I think 5.5% unemployment rate is a little bit higher, but I think it's still very much close to a healthy range that is considered as practically a full employment.

Well, Einar, the new government debt set at 11.86 trillion yuan, up nearly 3 trillion from last year, with a deficit rate of around 4%. How would you assess the sustainability of this fiscal expansion? Well, I mean, if you compare it to the United States, it looks minuscule. The U.S. is at 36.2 trillion as we speak in terms of debt. It's adding it on at a

rapid course. They just passed four trillion dollars in tax breaks, but they are not going to gain that amount in revenues, tax revenues. And as a result, that will be loaded on to the existing debt. So you have a situation there which is extreme. Also, you have a

Japan, which is well above, I think it's 125 to 150, depending on how you're measuring in dollar terms. And these are very difficult decisions that you have to make. But China has been, at the national level, fiscally very responsible.

The main issue is really, and the reason they're taking out this extra debt is because of the domestic situation. Government borrowing at the provincial and city levels particularly has been kind of masked. They use these special purpose vehicles and things like this to mask what they were trying to do. Now, what were they doing? A lot of it had to do with, you know,

you know, their promotion. They wanted to show economic activity so they would create some sort of structure so they could invest in something or whatever. And it just didn't work out. So the government is, you know, reining in these kind of extracurricular borrowings. And they're saying, OK, we're going to

help you move your short term debt, recognize the debt you have, and then move that into longer term debt where it's a little bit more manageable in terms of the interest payments and then eventually the principal payments. So this is just how an economy balances itself.

The national government is just saying, okay, we're the parent here. The kids have been spending too much. We need to rein them in and teach them how to be more fiscally responsible.

Professor Gong, the local government special purpose bonds are set to rise to 4.4 trillion yuan, up 500 billion yuan from 2024. What role do you see these bonds playing in addressing local government debt issues while driving infrastructure and public well-being projects?

Yeah, well, this is an extremely important part. In my view, this is essentially the defining feature of this round of stimulus package. It's all about bailing out local governments' debt because without that, there will be constriction at the local government level, which will percolate down to the private enterprises and the vendors and businesses that rely on the government. And that definitely takes a toll on consumption

consumer confidence and it has resulted also on investor confidence as well. I think we need to turn around this sentiment, this market sentiment, and an important piece is to use the national debt to replace the local government debt so that the local governments can keep their normal operation, can keep spending money, can do business as they used to do, to do business as usual. I think

This is something that has been recommended for quite some time and eventually the government said to do this. And I think the question about the validity of the theory of this practice boils down to what extent China can sustain a relatively high debt level. And I think we're okay because at the aggregate level,

the central government status, percentage of GDP, is just a little bit over 80%. And if you rank all the countries in the world in terms of their

debt to government, government debt to GDP ratio from the top to the low, you know, 80% is just in the middle, a little bit higher than the middle. Certainly, you know, way less than the example that Ina was just talking about, Japan, for example, right? So I think, you know, this is a debt level that can be sustainable.

We don't have a situation where a large percentage of the government tax revenue has been spending on paying interest. No, we don't have that kind of a situation. So I think it's a good strategy. And I think this is one of the most important strategies

ingredients in a recipe that turns around China's economy. And we should continue to do that. Well, Einar, the issuance of 1.3 trillion yuan in ultra-long special treasury bonds is also a major highlight, with 300 billion yuan earmarked for a consumer goods trade-in program.

How effective do you think this will be in stimulating domestic demand and could it offset potential export declines due to global trade tensions? Well, I think it's a primer. It's not necessarily going to fill the pipeline. A lot of that depends on how consumers feel. Now, remember, last year,

Chinese people saved 45% of their wages. Uh, this is unheard of. You know, if you go to the United States, it's, you know, like one or 2%. Um,

And in addition to that, there was an increase of over 6% in disposable income. That means they had extra income they could spend on whatever it is they wanted. But they didn't spend a lot. And their buying patterns after COVID especially have been very, very conservative. You see high-end restaurants disappearing left, right, and center. But if you go to the lower price and medium price, they're full.

So spending patterns, even luxury items, there's been a big dent in that and there's been a change. A lot of Chinese consumers are looking at Chinese fashions and luxury products and they say these are very good and they actually fit my sense of style.

And this is where I'm saying the confidence is the major factor here. Once consumers feel that the government and the country is on the right track, they have the wherewithal to spend. You don't have to just give them incentives all the time, but this is a way of priming the pump. And hopefully that gets these, you know, this dual circulation strategy that China has, you know, take care of your economy by boosting consumption.

and then use that as a way of attracting outside investment who are very keen on what China's doing. Remember, China's already 30% of the world's growth in terms of GDP, and it's going to continue to do that. It's been very, very steady.

And this is going to be very, very attractive, especially when you contrast it with what is happening in the US, which is a zero sum mentality. Let's collect these tariffs. Let's close down our economy to everything unless you're producing inside the United States. China is going exactly the opposite. They're expanding programs, not slashing them.

building more bridges to international groups, a lot of it in the global south, Central Asia. But these are important markets. You start adding up the world. I mean, 11 percent is Europe and America. The rest of it is the rest of the world. And quite frankly, the rest of the world has more GDP, more population, more land, more resources, etc.,

So, China is going the way of water. It's going where it can go and not trying to climb up the hill of American tariffs and things like that. And that's the key to its success. So, domestically, they're going to pursue these things. But like I said, it's about priming the pump, getting the system started so that it starts working.

Well, Professor Gong, the report emphasizes fostering new quality productive forces with industries like quantum technology, low altitude economy and AI integrated manufacturing. How transformative could these sectors be for China's economy?

Yeah, well, these are very important industries. When we talk about new productive forces, we're really talking about the new sunrise technologies, the things you just mentioned. And I think this wide consensus in China that these are the things that are really driving China's economic growth.

From an economist perspective, we know that productivity gain comes from either labor productivity or capital accumulation. And these days, more importantly, technological innovations. And also, we are also engaged in this grand competition between China and the United States. And this competition is front and center about the technological competition.

So I think it's extremely important companies, governments work together to foster a market that is really moving towards a high-tech, propelled, driven growth model.

I think one thing that is sort of very different in China is that we have intense competition. This competition really drives innovation. If you don't innovate, if you don't invest in R&D, you're going to be phased out by the market.

And I think it's more than just the companies competing against each other in an intensely competitive market. I think in China we also have a very unique phenomenon that our local governments are also very much engaged in this competition as well. I mean, they would like to have the companies in their area to be successful. They go out of their way to help these companies. So it's really sort of a government competition.

private sector partnership to drive innovation, to drive technological growth. And this competition is intense. I mean, it's really intense. So that's why you're seeing things happen very dynamically here in China.

So I think this is a very good phenomenon. And I think this explains a lot of what China's economic success is all about. It's really this intense market driven competition that is driving the technological innovation. Well, thank you, Dr. Zhang Gong, a professor with the University of International Business and Economics and Honor Tangian, senior fellow at the Taihe Institute. You're listening to World Today. Stay with us.

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You're listening to World Today. I'm Zhao Ying. As China's most important annual political event, the two sessions is underway, a national political advisor is calling for more focus on senior well-being. Jin Li, vice president of Southern University of Science and Technology, says elderly care services are struggling to keep up with China's aging population. He

He suggests strong policies and innovation would help seniors stay active in society. Speaking with Song Rui-Hsin, Jin also highlighted the super economy as a major opportunity worth an estimated 30 trillion yuan or about 4 trillion US dollars. Professor, first of all, could you please tell us about the proposal you are going to put forward at this year's two sessions? I

I mainly focus on the so-called silver economy in China. I brought a series of policy proposals to address specific issues that I see as important for developing that industry. And at the same time, I have a few other proposals focusing on developing the technological sector of Chinese economy.

So what drives your intense focus on elderly care services and the senior care industry? Well, in my opinion, there exists a sharp contradiction between the profound social transformation driven by an aging population and the inadequate supply of elderly care services, as well as the big potential to unlock a 30 trillion yuan silver economy through market-oriented mechanisms.

China's aging population has been accelerating. The number of people aged 60 and above has already surpassed 300 million and is projected to exceed 400 million by 2035, which will be about 30% of the total population of China. Currently,

China's elderly care industry exhibits a polarized structure. On one end, government-subsidized elderly care services provide a safety net for vulnerable groups. On the other, premium senior care facilities cater to the very wealthy group.

However, the diverse needs of the broader population remain largely unmet. This stark mismatch between the rigid care demands and existing service capacity is turning elderly care into a strategic sector that combines both social value and economic growth potential.

You've mentioned issues of affordability and some measures to inject fresh momentum. So how can elderly care services and the senior care industry kind of collaborate to maximize the benefits?

First thing we need to do is to have a public-private partnership to ease the financial pressures. Given the high potential investment and long payback periods in the silver hair industry, the publicly built, privately operated model offers a practical solution. The second thing that we could do is a time banking program.

where we could implement a system when the younger senior people aged between 60 to 70 could volunteer at the care centers and accumulate the service hours that later on can be redeemed for future care. Third thing that I think we could try to do here to address this issue, which I would call a value-added service for comprehensive elderly care.

Modern air care should go beyond the basic needs to promote an active agent. By diversifying revenue streams through premium services, care providers can serve both those requiring long-term assistance and those more active seniors. Recently, I've read a piece of news which says the International Electrical Technical Commission released international standards for elderly care robots.

So China took a leadership role in developing those standards. How might this impact the elderly care robotics market? Very good question. The first is global leadership in elderly care robotics standardization. The second one, in my opinion, is the breakthroughs in humanoid robotics technology. The third one is a new paradigm in robotics. These advancements signal a transformative shift in Chinese robotics industry.

from a phase of following to one of global leadership. With robust policy support and continuous technological initiation, iteration, robots equipped with adaptive capabilities are rapidly becoming integral to both the industrial production and daily life. This China solution

not only injects new momentum into our economic development, but also provides powerful support for addressing the global aging challenges, enhancing the ability of seniors worldwide to participate fully in society.

Yeah, Professor Jin, we have this China solutions right now, but some people are kind of worried about the fact that with AI and automation advancing, there might be a risk of job losses in traditional elderly care services. I mean, is that a concern? And how can China balance technological efficiency with the employment stability in this sector? It is very important to recognize

that robots cannot fully replace human labor. In areas where automation is still limited, human and robotic roles should be seen as complementary rather than substitutive.

This would require a robust workforce training program to meet the diverse skills demanded by new technologies and also enhancing the service efficiency across the industry through the human-robot collaboration. For workers in roles that are susceptible to substitution, we must explore and develop employment opportunities

across the whole industrial chain. We must explore and develop employment opportunities across the entire industrial chain.

We must facilitate the transition of the workforce to related upstream or downstream sectors. And the government should intensify efforts in vocational training and human capital development. In addition, we should provide unemployment insurance and social assistance programs that helps to minimize the adverse impacts of technological disruptions.

Professor Jing, you've spent around 20 years in the US and UK, correct me if I'm wrong. So from your observation, are there any Asian countries that have successfully developed their elderly care industries and promoted the silver economy in ways that China could learn from? And what lessons can China offer to the world regarding elderly care? Well, based on my observations,

Western nations generally place great trust in market mechanisms. The second is innovations in pension finance. It eases the economic pressure of smaller fragmented families by employing the investment vehicles that preserve and enhance the pension values. It also supplies long-term stable capital to the financial markets, which in turn funds the high quality elderly care projects.

such as smart nursing homes and rehabilitation centers. And the third is the government's dual roles, both as the safety net and as the catalyst for the development of the industry and innovation. China's approach to elderly care is uniquely shaped by its own cultural and social economic landscape. In China, there are about 120 million rural seniors,

accounting for about one-fourth of the rural population. They face greater risks of poverty and care deficits. So innovative approaches are emerging. These include the collective care villages that pool resources, mutual aid networks where younger seniors support their elders, and government-led

key coupons designed to subsidize essential services in the underserved areas. The third China unique characteristic is tech-driven leapfrogging. Leveraging on its strengths in artificial intelligence, the Internet of Things,

cloud computing and robotics China is pioneering smart home ecosystems that promote independent living using voice controlled assistance and emergency response systems and data-driven precision care through wearable health trackers I think there were so many other things that the Chinese have developed unique solutions to

that fits its own cultural and economic unique characteristics. These integrated effective market plus proactive government model employed by the Chinese society epitomizes China's commitment to modernizing elderly care while advancing common prosperities in China, molding technological innovation with socialistic welfare principles.

That is Jin Li, Vice President of Southern University of Science and Technology, speaking with my colleague, Song Ruixin.

European Commission President Ursula von der Leyen has put forward an €800 million plan to beef up Europe's defense. The money will also provide urgent military support for Ukraine after the U.S. suspended aid. Von der Leyen said she had written to European leaders ahead of the European Council meeting later this week to propose the Re-arm Europe plan.

The proposal includes a new joint EU borrowing of 150 billion euros to lend to EU governments for defense. For more, we are joined by Dr. Cui Hongjian, professor with the Academy of Regional and Global Governance at Beijing Foreign Studies University. Dr. Cui, thanks for joining us. Hi. So what do you think is driving this rearm Europe plan from Ursula von der Leyen?

I think the very recent stimulation for this so-called rearm program of the European security, European military, certainly is very, very negative. I mean, forecast for the scenario how to resolve this Ukrainian crisis. Also, now almost everything will be out of expectation from the European side.

especially now the negotiation is in, you know, between the USA and Russia. But of course, from a long-term perspective, I think that

The survival of NATO could be also a very, very big concern because recently, as we know, the American side always have this signal that the US will not be interested to provide some more security guarantee for European countries.

So I think for a short term and a long term, very, very big security concern. I think it gives a very big momentum for European side to decide, has its own capability to protect themselves. Well, how realistic is it for Europe to assume greater responsibility given its historical reliance on NATO and the U.S.?

I think it's difficult anyway, because as we know in history, several times in the European side, trying to have this issue of some independent defense or some other security capability.

But always, as we know, there are some obvious barriers. One of them is from their own system and also this unequal situation, I mean for the security concern or some other. Another one is from outside, for example,

Even now, yes, America looks like it gives some space for more security in Europe. But in the long term, I think there will be some limitation once the European side tries to have its own military or some defense capability.

And then also now, a very, very, I mean, pragmatic issue is how could the European side to get so much money?

to have a sustainable investment in military. As we know, even for this 8 million euro fund, it looks like just a few part of this volume will come from the European Union, but most of them will get some financial support from market. But as we know,

According to the current situation economically in Europe, I think it's difficult. Okay. Well, we know this proposal comes after Donald Trump paused military aid to Ukraine and pushed for Europe to spend more on defense. So do you see this as a turning point in transatlantic relations or is it more of a temporary reaction to U.S. policy shifts?

Yes, I think it could be a very important time for the relations between the US and Europe. But I think it's too early to say it's a turning point for these transatlantic relations.

Because so far, as we know, even from this open announcement officially from the European side, still is trying to find some more cooperation, military or security with the United States.

And the relations with the United States is still the fundamental principle or concerns or requirement from the European side. Because as we know, even this direction to have its own capability is clear and also substantial. But in short term, I think on this capability building process,

undoubtedly uh european side uh needed also a lot of uh support and also even uh permit from united united states because still nato is there so i think that's a

Yes, there are some space, there are some more possibilities than before, but not yet. I think it's a real turning point. Yeah, but how does this initiative affect NATO? Will it strengthen European contributions to NATO or does it signal a move towards greater EU defense autonomy?

To a large degree, undoubtedly, this preparation or this issue of re-arming Europe, one of the purposes is they try to provide an alternative to NATO. As you know, NATO is facing a very, very big problem for its

survival. Yeah, thank you, Dr. Cui Hongjian, professor with the Academy of Regional and Global Governance at Beijing Foreign Studies University. Well, thank you so much for joining us. You're listening to World Today. We'll be back.

You're listening to World Today. I'm Zhao Ying. The Mobile World Congress is underway in Barcelona, Spain. It is one of the world's biggest tech fairs, showcasing what people will be buying soon. Several Chinese tech companies, including Huawei and Xiaomi, are there with cutting-edge innovations ranging from artificial intelligence to 5G and Internet of Things.

For more on this, my colleague Zhao Yang spoke with Andy Mock, tech analyst and senior research fellow at the Center for China and Globalization. So thank you very much for joining us, Andy. First of all, what are the key technologies caught your attention at this year's Mobile World Congress in Barcelona? I think there are two very important developments that are worth pointing out.

The first one is something called AI at the edge, meaning that the AI processing or the capabilities are on the device, meaning that can be on your phone. It could be on a PC. It could be in your car.

And this is vastly different from the way AI is largely delivered today through these large language models that are very big, require a lot of processing and a lot of electrical power at a data center.

Now, companies like Xiaomi, like Honor, like Huawei are all leading here by offering, again, AI capabilities on your device, on your smartphone in particular. Now, why this is important is that it's not just less power consumption and faster processing times, but this also offers greater privacy because you can keep all of your data on your device.

So this is a very, very important development that I think we'll be seeing a lot more of. And Chinese companies are leading the way here. The second element is in the automotive space. And here, Xiaomi has launched successfully launched at scale a highly regarded high performance product.

cost effective automobile offering that rivals Porsche in terms of performance at a fraction of the cost. And I think what's important here is not just that Xiaomi was able to do this, which is an achievement in and of itself, but it succeeded where Apple succeeded.

which of course is a global technology leader, an enormous company with tremendous financial resources at its disposal, failed to do this through its project Titan. So I think these are two very, very important developments to pay attention to at a time where most experts in the AI space

believe we are at a watershed period where we will see transformational improvements, including the arrival of artificial general intelligence sooner than many people had believed possible.

And as you mentioned, Xiaomi actually unveiled its latest headline product, the Xiaomi SU7 Ultra, an electric supercar. Xiaomi is betting big on the Internet of Things, using the power of AI to connect everything. And also, Andy, the Mobile World Congress is also a tech forum and feels more important than ever in this moment. So talk

Talking about the technological or AI development, how far away from the AGI or the artificial general intelligence? Well, this is an important question, Zhaoyang. And I think most experts, even those working directly

on the efforts to create artificial general intelligence feel that it's really difficult to make a precise prediction. But that being said, I think there's a growing consensus that it will arrive sooner than many people have thought possible. And in fact,

in some sense, may have already been arrived, but has not been evenly rolled out yet. And I hate to use this quote because it's so overused, but William Gibson, the science fiction writer, wrote that the future is here. It's not just evenly distributed yet. And I think this is especially true for efforts to develop artificial general intelligence, because in these AI labs,

Lots and lots of research is going on, but for various reasons, these capabilities are not rolled out to the public.

may not even be disclosed for strategic business reasons, maybe for strategic political reasons as well. So I think the answer is that we may be very surprised sooner versus later. How should we regulate the development of AI? What should be the focal point, do you think? Well, I think this is another very important question that governments around the world are struggling with.

in that no one really knows what capabilities AGI may have. Now, we can think, okay, it's going to be smarter than the smartest PhD. Now, that's a type of intelligence we know how to deal with and how to regulate. But what happens if it becomes what some might call ASI or artificial superintelligence?

where it is so much smarter that we can't even comprehend its intelligence the same way that a chimpanzee could not comprehend topics like astrophysics or different kinds of philosophy, cosmology, say. And so this is a big question, and I think this is why some people are concerned.

But the other way to think about it is that AI is advancing very rapidly. We can also use AI to help us perhaps think of ways to regulate AI. And I think, again, this is a very big, important question that the answers to which are still being asked.

discovered. And we've heard experts talk about how important the mobile sector is to the economy. A latest report forecasts its value could be at 11 trillion US dollars by the year 2030. This is around 8% of the global economy. So could you elaborate more on that? What is mobile economy and how would change our work and life? What could be the outlook for the mobile economies in the future?

Well, another very good question, Zhao Yang, that is also, I think, challenging to answer because when we think about the mobile economy, I think we probably, we largely think of it as mobile phones, smartphones. But in a world where we're seeing AI, mobile, all these other technologies kind of overlap

I think it's very hard to say. And I think back to, uh, Mark Andreessen, who wrote a very famous essay a number of years ago called software is eating the world. Uh, and maybe we can say, uh, AI powered, uh, mobile computing is eating the world. If we think about this as always ubiquitous, uh,

access to AI capabilities, right? It could be other kinds of wearable devices, of course, our phones,

etc. So we may look back and think the numbers we're throwing about today are actually very small. And this may come to be a much, much larger percentage of our measured economic activity. And what about the global investment and race in AI? Could you tell us more about this landscape? Well, I think here, you know, the starting point is

All of the companies and countries that have a credible claim to...

AI leadership, technology leadership, start by investing a lot of money, billions of dollars, tens, hundreds of billions of dollars, as we see, you know, the U.S. example of Project Stargate, you know, really, really astonishing amounts of money. But at the same time, we also see other innovative approaches like that of deep seek,

who really achieve breakthroughs not so much by throwing a lot of money at a problem, but maybe we could say visionary strategies coupled with clever engineering. So I think what we're seeing here is both.

And China, we see because of its manufacturing prowess, its large, well-educated, highly motivated workforce, a big domestic market, government support, with the ability to formulate and implement long-term comprehensive strategic plans around innovation of which AI and mobile computing are vital parts.

That was Andy Mock, tech analyst and senior research fellow at the Center for China and Globalization, speaking with my colleague Zhao Yang. And that's all the time we have for this edition of World Today. A quick recap of today's headlines. China targets economic growth of around 5% in 2025. European Commission President Ursula von der Leyen has proposed an €800 billion plan to rearm Europe.

And with the Mobile World Congress underway in Barcelona, we'll discuss the trends that will shape the future of mobile economy. To listen to this episode again or to catch up on previous episodes, you can download our podcast by searching World Today. I'm Zhao Ying. Thank you so much for listening. See you next time.