hina’s National Bureau of Statistics (NBS) recently issued the 2021 Statistical Classification of Digital Economy and its Core Industries, a document which for the first time defines the range of the digital economy and provides a statistical standard for measuring China’s digital economy.
The three elements of the digital economy are defined as data resources, modern information networks and telecommunication technologies. The document classifies the digital economy into five areas, including digital product manufacturing, digital product service, digital technology application, the industries that drive the digital elements, and industries that raise the efficiency of digitalization. The first four are seen as digital economy’s core businesses, and the last as a non-core business.
Analysts said the move is a milestone in China’s governance of the digital economy which will set a solid foundation for faster and better-quality development.
According to the 2021 Report of the Chinese Digital Economy published by the China Academy of Information and Communications Technology (CAICT) on April 25, the scale of China’s digital economy has reached 39.2 trillion yuan (US$5.8t) in 2020, a 9.7 percent nominal growth year-on-year.
The fast growth is based on China’s rapid rollout of information infrastructure. By 2020, China had built the world’s largest 4G and 5G networks, and the number of internet users hit 989 million, 70.4 percent of the total population, according to the China Internet Network Information Center (CNNIC).
The extensive networks allowed rapid development of online education, sales and healthcare. According to the CNNIC, the number of online education users and online medical care users grew to 342 million and 215 million in 2020. Meanwhile, many traditional primary and secondary industries have established online platforms or launched apps.
The CAICT report said the digital economy’s share in service industries, industry and agriculture rose to 40.7 percent, 21 percent and 8.9 percent in 2020, indicating faster and deeper digitalization.
In 2020, the digital economy ratio to GDP in China was 38.6 percent, lower than that of the UK, Germany and the US, whose ratio is around 60 percent. It indicates that China’s digital economy still has large space to develop. Analysts predicted that China’s digital economy, supported by government encouragement and pandemic control, will see a golden age of development in the following five years, with cloud and AI technologies being the two big drivers.