Deep integration of real economy and digital economy: A new driver of China's high-quality development

Editor's note: Wang Peng, a special commentator on current affairs for CGTN, is an associate researcher at the Beijing Academy of Social Sciences, a big data business analyst, and a senior network public opinion Analyst. The article reflects the author's opinions and not necessarily those of CGTN.

China Development Forum 2025 takes place in Beijing from March 23 to 24. Under the theme "Unleashing Development Momentum for Global Economic Stability and Growth," the forum focuses on key issues shaping China's current and future economic development. Topics such as digital economy, artificial intelligence and industrial digitalization will take center stage as attendees explore how these emerging fields can drive high-quality development. Meanwhile, according to China's latest government work report, China's GDP grew by 5 percent in 2024, placing it among the world's top-performing major economies. The report also highlights the accelerated progress in building a "Digital China," with the added value of core digital industries now accounting for around 10 percent of GDP. These milestones not only lay a solid foundation for economic growth in 2025 but also underscore the steady advancement of Chinese modernization. Amid an increasingly complex global landscape and the challenges of domestic economic restructuring, China is navigating this evolving terrain through deepening reforms, expanding the digital economy, and strengthening technological innovation. By doing so, China is building new growth engines that inject powerful momentum into both the domestic and global economy.

Deep integration of real economy and digital economy

The List of 2024 Key Tasks for Building a Digital China issued by the National Data Administration lays out key priorities across four major areas: High-quality construction of a digital development foundation, digital empowerment leading high-quality economic and social development, strengthening the supporting role of Digital China's key capabilities, and creating a good atmosphere and environment for digital development. The digital economy has emerged as a critical engine of China's economic growth and a key lever for fostering new quality productive forces.

According to the Research Report on the Development of China's Digital Economy (2024) released by the China Academy of Information and Communications Technology, the size of China’s digital economy has reached 53.9 trillion yuan ($7.44 trillion) and continues to grow at a rapid pace. The fusion of the real economy and digital technology has become a central force driving high-quality development, playing a pivotal role in enhancing industrial efficiency, optimizing resource allocation, and ensuring stable economic growth.

By the end of 2023, China had launched over 7,000 "5G + Industrial Internet" projects and developed 50 cross-industry and cross-domain industrial internet platforms. The number of influential platforms, ranging from comprehensive to sector-specific, reached 270. With the accelerated development of intelligent manufacturing and industrial internet, China's manufacturing sector is rapidly advancing toward higher-end, smarter production.

Digital agriculture is also transforming China's rural economy, playing a key role in advancing rural revitalization. In 2023, China's smart agriculture market reached 101.639 billion yuan ($14.02 billion), with technologies such as drone-based crop protection and intelligent irrigation significantly improving agricultural production efficiency. In northeast China's Heilongjiang Province, innovative agricultural platforms powered by IoT and big data enable precision farming, leading to higher grain yields.

Besides, China is also enhancing the efficiency of public services through digital government initiatives. The Guangdong-Hong Kong-Macao Greater Bay Area has launched the “Digital Bay Area” program, leveraging cloud computing and blockchain technology to facilitate cross-regional government data sharing. This program has streamlined administrative processes, improved governance efficiency, and optimized the business environment.

AI-powered innovation and industrial transformation

According to a report by the China Internet Network Information Center in 2024, as of June last year, China had 230 million users of generative AI products, and the core AI industry was valued at nearly 600 billion yuan ($83 billion). The 2024 Government Work Report highlights the need to accelerate AI integration across sectors to foster the growth of new quality productive forces. The rapid development of AI technology is enhancing efficiency across traditional industries and driving the development of emerging industries, positioning AI as a major force behind China's economic growth.

Competent healthcare has become a key part of the healthcare industry's digital transformation as AI technology evolves. Companies like Tencent Miying and Ali Health are leveraging AI for medical imaging analysis, as it enhances diagnostic efficiency while reducing misdiagnosis rates. Meanwhile, AI is also revolutionizing drug discovery by shortening research and development cycles and accelerating the time-to-market for new drugs.

AI is increasingly embedded in financial risk management and smart investment advisory. Institutions such as the Industrial and Commercial Bank of China (ICBC) and Ant Group utilize AI-powered big data analytics tooptimize risk control, enhance the precision of financial service delivery, and provide tailored financial solutions for small and micro businesses.

The fusion of AI and online education paves the way for truly personalized learning experiences. AI-powered teaching assistants and intelligent grading systems are helping bridge educational gaps and improve access to quality resources. Leading ed-tech companies such as TAL Education and New Oriental have developed AI-driven tutoring systems that provide customized learning plans tailored to each student's pace and needs.

Digital transformation of traditional industries: Upgrading manufacturing and service Industries

China has over 30,000 basic-level smart factories, 1,200 advanced-level smart factories, and over 230 top-tier excellence-level smart factories, marking initial success in developing multi-level intelligent manufacturingsystems. Digitalizing traditional industries improves production efficiency and injects new momentum into economic growth, solidifying its role as a key pillar of high-quality development. Moving forward, China aims to accelerate the digital transformation of both manufacturing and service industries to strengthen industrial competitiveness on a global scale.

In recent years, China has been ramping up policy support for intelligent manufacturing to drive the digitalization of its industrial manufacturing sector. Leading automakers like BYD and SAIC Motor have built fully digitalized smart factories, leveraging 5G and AI to optimize production processes and enhance efficiency. Beyond automation, emerging production models such as flexible manufacturing and intelligent schedulingreshape traditional manufacturing models.

Digital transformation is merging online and offline service delivery in the service industry. Smart retail, cashier-free stores, and other emerging business models are thriving. Platforms like Meituan and JD.com use AI-powered algorithms to improve supply chain management, enhance user experience, and accelerate the digital transformation of traditional brick-and-mortar retailers. Beyond retail, digital tourism and online education are also experiencing rapid growth.

Driven by digital technology, China's traditional energy sector is also transforming. Companies like State Grid Corporation of China and China Southern Power Grid spearhead innovative grid initiatives, utilizing digital technologies to optimize electricity dispatching and enhance the efficiency of renewable energy utilization. In 2024, China's renewable energy sector added a new installed capacity of 373 million kilowatts. The integration of digital technology and renewable energy is accelerating.

Driving high-quality development and global economic recovery

China is accelerating the development of new, high-quality productive forces through integrating digital and real economies, AI-driven innovation, and the digital transformation of traditional industries. These efforts inject fresh momentum into economic growth and offer China the experience of driving global economic recovery.

At the China Development Forum 2025, leading economists, corporate executives, and policymakers worldwide will come together to explore how technological innovation and industrial upgrading can drive stable and sustainable global economic growth. China's digital economy model may serve as a valuable blueprint for economies seeking to recover and reinvent themselves. As digital technologies keep evolving, China is set to play an even more pivotal role in shaping the global economic landscape, contributing new insights and solutions to support global economic growth.

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