Photo taken on April 19 shows the building site of a 5G base station near the advanced base camp of Mount Qomolangma in southwest China's Tibet Autonomous Region. The station, along with another two that were previously built at altitudes of 5,300 meters and 5,800 meters, covers Mount Qomolangma’s north ridge and summit with 5G signal. Photo: XINHUA

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China is eyeing “new infrastructure” projects to offset the economic impact of COVID-19 and boost sustainable growth.

As infrastructure with emerging economy characteristics, new infrastructure construction is driven by technological innovation and based on information networks, providing services such as digital transformation, intelligent upgrading and converged innovation to meet the needs for high-quality development.

The new infrastructure projects can be divided into three categories: information-based infrastructure, converged infrastructure and innovative infrastructure.

Information-based infrastructure includes communication network infrastructure represented by 5G and the internet of things, new technology infrastructure represented by artificial intelligence and cloud computing, and computing power infrastructure represented by data centers and intelligent computing centers. Converged infrastructure will come into being as the internet, big data and other technologies are widely applied to support the transformation and upgrading of traditional infrastructure. Innovative infrastructure refers to the infrastructure that supports scientific research, technology development and product development, with public welfare attributes.

According to Zhu Yan, director of the Institute of Internet Industry at Tsinghua University, the essence of the new infrastructure is to build a new platform to complete various data exchanges. It is the foundation for realizing the market-based allocation of data as a factor of production. From a macro perspective, the new infrastructure is built around the development of the digital economy. Through digitalization, it finds new economic growth points for social development and releases new digital consumption, thereby driving the digital transformation of the country’s economy.
 

The new infrastructure will provide the basis for a new round of industrial and technological revolution in China through the digital economy and high-end technology. Wang Xiaohui, deputy director of the Institute of Internet Industry at Tsinghua, noted that through vigorous investment in next-generation information technology, high-end manufacturing and new-type modern service industries, new infrastructure will accelerate the optimization of China’s economic structure and promote the digital transformation of industries; furthermore, it will facilitate national economic, financial and social stability through investment.

Under the dual pressure of the current epidemic situation and the economic downturn, the new infrastructure could become a focus and the core ballast for economic stability, Wang continued. In addition, increasing investment in new infrastructure is equivalent to using funds to directly promote supply-side structural reform. By improving basic factors, it boosts innovation of the upper-level economic model, products and services, laying the foundation for the future development of the digital economy and society.

Regarding how to wisely choose a new infrastructure project, Chen Yongwei, a research fellow from the Center for Market and Network Economy at Peking University, said “general purpose technology” that promotes the productivity of all sectors in the long term and “key technology” essential for the development of key industries should be given special attention, because these technologies are essential to China’s national competitiveness.

Moreover, when advancing the new infrastructure, it is necessary to take into account both the push of top-down supply and the pull of bottom-up demand. It is necessary to pre-invest in some key technology areas that are related to long-term development and listen to the voices of the industries to provide the infrastructure they desperately need. In addition, Chen suggested that new infrastructure projects consider allowing private capital to play a bigger role and become the main force of some projects. Compared with the government and state-owned enterprises, private enterprises are more in tune with the market and can also generate more business models.

For the new infrastructure to play its supporting role better, it is necessary to formulate key standards for the development and application of next-generation information technology and to introduce policies for the digital transformation of related industries, suggested Xing Chunxiao, deputy director of the Research Institute of Information Technology at Tsinghua. By increasing the coverage of existing new technological facilities, the industrial internet should be promoted to benefit from the leading role of 5G communication, artificial intelligence, big data and other digital technologies, facilitating China’s high-quality economic development.

 

edited by JIANG HONG