Shanghai launches $139M subsidy to boost AI sector
What's the story
Shanghai has announced a massive subsidy program worth 1 billion yuan ($139 million) to bolster its artificial intelligence (AI) industry. The move comes as the city looks to compete with other Chinese megacities that are also heavily investing in their own AI ecosystems. The subsidy package will mainly focus on reducing costs for start-ups and facilitating the adoption of AI solutions by local businesses.
Funding breakdown
What does the plan entail?
The Shanghai subsidy program will allocate 600 million yuan to subsidize computing power, 300 million yuan for discounts on third-party AI models, and 100 million yuan to help companies procure data collections or corpuses for training new models. The plan also provides extra subsidies for renting, purchasing, or building computing facilities, AI models and datasets with rates ranging from 10% to 100% of the contract value.
Industry insight
Program likely to boost local AI industry, says expert
Pan Helin, an expert committee member under China's Ministry of Industry and Information Technology, said the subsidy program is likely to yield tangible results in boosting Shanghai's local AI industry. He emphasized that one of Shanghai's key advantages in AI development is its strong funding. The city has always been a magnet for entrepreneurs due to its robust financial sector and global outlook.
Market dynamics
Other cities also vying for AI leadership
Despite its appeal, the high operating costs in Shanghai—such as office rent and daily expenses—could push new AI start-ups to cheaper cities like Hangzhou. The competition in China's AI industry is intense with many cities promising to be key players. Notably, Shanghai isn't the only city offering generous subsidies for attracting AI companies. Hangzhou, Shenzhen, Chengdu and Beijing have also launched similar initiatives.