China Unveils $295 Billion Plan to Build National AI Data Center Network Over Five Years
June 9, 2026
China Unveils $295 Billion Plan to Build National AI Data Center Network Over Five Years
China is preparing to invest approximately 2 trillion yuan ($295 billion) over the next five years to construct a nationwide network of interconnected data centers, marking Beijing's most ambitious push yet to dominate the global artificial intelligence race. The initiative, still in early planning stages, is designed to accelerate domestic AI development and reduce reliance on U.S. technology, according to people familiar with the matter.
Key government agencies, including the National Development and Reform Commission, are drafting a blueprint to establish a unified system of computing hubs across the country. State-owned enterprises such as China Mobile Ltd. and China Telecom Corp. will operate the majority of these data centers and ensure they are seamlessly connected, one of the people said. The plan also mandates that at least 80% of the technology used—including AI chips—come from local suppliers like Huawei Technologies Co., effectively sidelining U.S. companies such as Nvidia Corp. and Advanced Micro Devices Inc.
The massive infrastructure buildout recalls earlier national campaigns that marshaled resources to support domestic champions like Huawei, with a clear aim of replacing foreign technology. It is also a key component of the broader "Six Networks" program announced earlier this year, which covers essential infrastructure from water and electricity to computing. "Elevating it to a national strategy ensures policy alignment and capital mobilization," said Charlie Dai, principal analyst at Forrester Research. "A unified computing network would pool fragmented regional resources and give enterprises broader access to high-performance computing. It would also help speed up AI model iteration and the expansion of agentic and physical AI services across industries."
The plan is expected to be funded primarily through sovereign debt, including ultra-long-term special government bonds with tenures exceeding 10 years, as well as state funds for strategic industries. Bank loans and private capital will supplement the financing, the people said. Despite mounting government debt and slowing spending elsewhere, the initiative underscores Beijing's resolve to drive cutting-edge technologies. Shares of major Chinese data center providers reacted sharply to the news: GDS Holdings Ltd. rose as much as 12% in pre-market U.S. trading, while Vnet Group Inc. climbed 17% following the report.
The data center blueprint remains in early discussions and details could change, the people cautioned, speaking on condition of anonymity. However, the scale of the investment—nearly $300 billion over five years—signals a long-term commitment to building the foundational infrastructure for China's AI ambitions, positioning the country to surpass the U.S. in what many consider a game-changing technology.
Source: finance.yahoo
