China advances digital ambitions with massive data centre investment

 Beijing invests billions in nationwide data centre project.

According to a senior government official, China has invested over 43.5 billion yuan ($6.1 billion) in building computing data centres nationwide. The investment, part of the ‘Eastern Data, Western Computing’ initiative, aligns with President Xi Jinping’s vision for a ‘digital China’ and responds to increasing US restrictions on advanced computing products.

The initiative, launched in early 2022, focuses on constructing eight major data centre hubs in western regions. These hubs leverage the West’s energy resources to provide computing power to economic centres along the coast. The strategy underscores China’s determination to enhance its computing capabilities despite external pressures.

Liu Liehong, head of the National Data Bureau, reported that the project has drawn more than 200 billion yuan in total investment and has installed over 1.95 million server racks, with around 63% currently in use. The project demonstrates China‘s commitment to fostering a robust digital infrastructure.

In addition to government spending, Beijing actively seeks private investment to further bolster the initiative. The significant investment highlights China’s ambition to lead the global digital economy while countering challenges posed by US technology restrictions.

BEIJING, Aug 29 (Reuters) - China has invested over 43.5 billion yuan ($6.12 billion) in a nationwide project to build computing data centers over the past years, a senior government official said on Thursday, amid tech export restrictions from the United States.

Liu Liehong, head of China's National Data Bureau, disclosed the figure, which is current as of end-June, at an industry conference in the southwestern city of Guiyang, state news agency Xinhua reported.

Beijing officially launched the initiative, dubbed "Eastern Data, Western Computing", in early 2022 as part of President Xi Jinping's push to build a "digital China".

China's massive investment in computing comes as it faces increasing restrictions from the United States, which has limited exports of some advanced computing products, including those from industry leader Nvidia (NVDA.O), opens new tab in recent years.

In response, China has been ramping up efforts to develop its own advanced computing capabilities.

The "Eastern Data, Western Computing" project includes plans to construct eight major data center hubs, primarily located in the western regions. This strategy aims to utilize the abundant energy resources in the west and transfer computing power to the economic hubs along the coast.

Beyond direct government spending, Beijing has also sought to attract other types of investment, including private capital.