From canal town to AI powerhouse: Suzhou's quiet revolution

Suzhou, a city known for its UNESCO-listed gardens and canals, located in East China's Jiangsu Province, has emerged as a powerhouse of modern industrial innovation. With 160,000 industrial enterprises, including more than 17,400 high-tech enterprises, it ranks 4th in the country and recorded a staggering industrial output of 4.7 trillion yuan in 2024, exemplifying how tradition and technology can coexist and thrive. While its UNESCO-listed landscapes symbolize a rich past, Suzhou's transformation into a City of Intelligent Manufacturing showcases its strategic pivot toward AI-driven industries, advanced robotics, and global supply chain leadership.

This is not the familiar story of China's coastal factories but a more nuanced one — a millennium-old cultural hub pioneering a high-tech future without erasing its past.

The ecosystem: how Suzhou nurtures innovation

Suzhou's transformation stems from deliberate cultivation. The city's "1030" modern industrial system targets 10 key industrial clusters and 30 key industrial chains, with artificial intelligence at the forefront. Policy continuity has been crucial. For two consecutive years, Suzhou has launched its annual agenda with a "New Year's First Meeting" focused on advancing new industrialization. This annual meeting is a key event for the city, typically held on the first working day of the year, to emphasize the strategic importance of industrial innovation and advanced manufacturing for the city's future development. The human capital foundation is equally impressive. With a talent pool of 4.07 million, including 450,000 high-level professionals, Suzhou has implemented the Suzhou Innovation and Entrepreneurship Leading Talent Program for 17 consecutive years. National-level platforms like the Suzhou Laboratory and the Deep-time Digital Earth International Science Program provide research infrastructure, while the Suzhou Industrial Park offers an open innovation platform that has become a model for China's development.

Industrial clusters: from single companies to innovation forests

Suzhou's transformation from individual enterprises to integrated ecosystems represents a fundamental shift in economic development strategy. The city now ranks among China's top five cities for artificial intelligence development. In 2024, Suzhou's AI industry generated 236.2 billion yuan in revenue, up 20 percent year over year.

The cluster effect is particularly evident in advanced manufacturing. The city is home to seven "Lighthouse Factories" recognized by the World Economic Forum for representing the highest global standards in intelligent manufacturing and digitalization. Hengtong Group, one of these Lighthouse Factories, began its digital transformation as early as 1998, underscoring that Suzhou's industrial upgrading has been decades in the making.

AISPEECH: a case study in symbiosis

Founded in Cambridge, UK, in 2007, AISPEECH relocated to Suzhou Industrial Park in 2008, a move that was driven by the city's supportive environment. The company's growth mirrors Suzhou's own transformation. In July 2023, AISPEECH released its self-developed DFM-2 conversational language model, which later became Jiangsu's first AI model to meet the dual filing requirements under China's generative AI regulations. 

In an interview with Long Mengzhu, the company's Chief Marketing Officer, we examined how Suzhou's cluster dynamics—particularly in high-end equipment and automotive electronics—have driven AISPEECH's growth.

Suzhou Industrial Park (SIP), home to AISPEECH since 2008, had attracted over 1,800 companies in artificial intelligence and digital industries, with output exceeding 110 billion yuan by the end of 2024. For AISPEECH, this ecosystem serves as a dynamic testing ground and collaboration network. "Suzhou has a particular advantage; it has a very rich industrial cluster," Long said. "Among AI Speech's three major fields, the development of automotive and IoT businesses definitely requires the integration of resources from upstream, midstream, and downstream sectors, including the application layer. For example, in the field of the Internet of Things, Suzhou has globally leading sweeping robot companies. These companies have provided us with excellent, fertile ground to communicate with customers quickly, including technical integration, and to form groups to go overseas." The company's full-link voice technology now serves over 60 automotive brands, with systems integrated into more than 15 million vehicles globally. Beyond automobiles, AISPEECH partners with most major home appliance brands, including Midea, Meiling, Haier, Hisense, Panasonic, and Xiaomi.

A delicate balance: preserving heritage while embracing innovation

Suzhou's development model represents a distinctive approach to urban transformation — one that preserves cultural heritage while advancing technologically.

The city has maintained a strict 24-meter height limit for buildings in its historic center for forty years, protecting the classical skyline while allowing modern districts to flourish elsewhere. Instead of treating history as a relic, the city integrates it into modern life. The Pingjiang Historic District, with its cobblestone streets and canals, buzzes with activity as teahouses host Kunqu Opera performances alongside AI-powered exhibitions. The city also leverages digital tools to safeguard intangible cultural heritage. For example, AI companies like iFlytek and Xiaoice have developed platforms that generate poetry in classical styles or simulate the soft tones of the Suzhou dialect, once at risk of disappearing. These technologies are not just for preservation; they make culture accessible. During the 2025 Spring Festival, an AI-produced short film series featuring rap-singing clay figurines from Tiger Hill reached 264 million viewers worldwide, showcasing Suzhou's ability to blend tradition with pop culture.

The road ahead

The city aims to reach 5 trillion yuan in industrial output from enterprises above the designated size by 2026. Beyond the numbers, Suzhou represents a distinct development paradigm — one where ancient canals and AI laboratories coexist, each drawing strength from the other. As one of China's largest "immigrant cities" after Shenzhen, Suzhou continues to attract talent nationwide. The city that once epitomized classical Chinese beauty has become a laboratory for technological innovation, demonstrating how tradition and innovation can reinforce rather than contradict each other.