The Digital Transformation in China

Description

China stands at a pivotal moment in its economic history. Ageing demographics and the erosion of traditional low-cost advantages are necessitating a shift away from factor-driven growth toward innovation and productivity. The digital economy — powered by artificial intelligence, big data, cloud computing and fintech — has emerged as the central force reshaping how China produces, trades and governs.

China Update Book 2026 brings together leading economists and policy analysts to examine this transformation in depth. Drawing on rigorous empirical research, the volume traces how ICT industries have driven output and productivity growth, how digital innovation interacts with China’s broader innovation system, and how AI is modernising China’s industrial structure. It investigates the rapid but uneven expansion of digital finance — from mobile payments that have largely displaced cash in urban everyday life to fintech services reshaping rural credit markets — and asks whether China’s financial system has achieved inclusive depth or merely impressive reach.

The volume also examines data as a distinct factor of production in regional growth, the use of digital technology to transform rural governance, and the policy frameworks governing data-driven economies. Chapters on China’s international balance sheet, its rising current account surplus, and the resilience of its export sector, as intermediate goods push it up global value chains, situate digital transformation within the wider macroeconomic landscape. Further contributions address the impact of US technology export controls, China’s data localisation laws, the digitalisation of production and trade, and the promise of digital agriculture.

Authoritative, timely and wide-ranging, China Update Book 2026 is essential reading for scholars, policymakers and anyone seeking to understand how digital transformation is redefining China’s economic future.