China's AI Data Centre Push

China is intensifying its focus on optimising data centre usage to boost its AI capabilities and compete with the United States. This involves tighter regulation of existing data centres to maximise limited computing resources. China's computing power reached 246 exaflops as of June 2024, placing it second only to the US. Shanghai aims to complete at least five new large-scale data centres by the end of the year to meet rising demand for computing power, and is expected to elevate the city's AI computing capacity beyond 100 exaflops.

Despite facing restrictions on importing advanced chips, China is constructing massive AI data centre hubs, including one in Xinjiang, supported by significant investments. These centres will house tens of thousands of servers and utilise advanced chips to power AI supercomputers. This infrastructure aims to support various applications, from smart cities to scientific research, and overcome technological barriers. The initiative reflects China's ambition to lead in AI by 2030, turning remote regions into technology innovation hubs.

China owns more AI clusters than any other nation, with 230 facilities and approximately 629,000 chips. However, restrictions on advanced chip imports mean that China delivers only 400,000 H100 equivalents. This structure has encouraged Chinese labs to focus on efficiency, prioritising models that do more with fewer resources.