Author: Yu Shaoqing
The Chinese economy has not yet emerged from the doldrums, but with the unexpected solo breakthrough of DeepSeek in the field of AI large models, technology stocks are undergoing asset revaluation, and the recovery of the Chinese economy is seeing a glimmer of hope.
Clearly, the positive feedback brought by DeepSeek is still ongoing. Starting from February 24, DeepSeek announced the launch of the "Open Source Week", with the first open-source code library being Flash MLA, which will further benefit cloud vendors and data centers, making it easier for them to further "squeeze out" the computing power of existing chips.
The popularity of DeepSeek has not only attracted downloads from hundreds of millions of ordinary users, but has also driven government departments in Shenzhen, Shenyang, Dongguan, Guangzhou and other places to access it, and has even prompted the tech giant Tencent, which was previously cautious about AI, to bet on DeepSeek. Currently, Tencent's Yuanbao App is at the top of the free download chart on the Apple App Store, surpassing ByteDance's Douban, second only to DeepSeek; on the app stores of Huawei, Xiaomi, vivo and others, Tencent Yuanbao is also in the top position.
Tech giants like Tencent and Alibaba are trying to catch the technological dividends brought by DeepSeek's open source, and then realize the diffusion of these technological dividends through billion-level application scenarios, which undoubtedly helps to narrow the overall gap between China and the US in AI development.
DeepSeek was founded in May 2023, less than two years ago. But in the two years from the end of 2022 to the present, China has shown an amazing art of policy adjustment: on the one hand, against the backdrop of the "decoupling theory" in the international community, it has established the policy tone of "further expanding opening up", using the continuously expanding visa-free policy to attract foreigners to come to China for tourism, business and investment; on the other hand, against the backdrop of insufficient confidence in the development of the private economy, it has introduced hundreds of policies to promote the development of the private economy one after another, established the Bureau of Private Economic Development under the National Development and Reform Commission, and cracked down on the phenomenon of "distant-water fishing" and so on.
China Development High-level Forum 2024 Annual Meeting: Bai Chongen, Dean of the School of Economics and Management, Tsinghua University, in dialogue with Tim Cook, CEO of Apple
Maintaining an open posture externally and maintaining inclusiveness in development internally are the fundamental conditions for the breakthrough of the Chinese technology industry. However, when summarizing the reasons for the success of DeepSeek's solo breakthrough, there are two extremely terrible voices that have occupied the mainstream. First, the DeepSeek team is mainly composed of domestic university graduates, so China can also achieve independent R&D breakthroughs by closing the door; second, DeepSeek's success is due to the keen eye and precise support of the local government.
The first view has actually reversed the basic logic. Since the outbreak of the Sino-US trade war and technology war in the spring of 2018, China has been more open than the US while maintaining a "tit-for-tat" strategy. Especially after the emergence of ChatGPT in 2022, the academic, industrial and policy circles in China have conducted a collective reflection, and the vast majority of people recognize that the US is further widening the gap with China in frontier technology. Under this crisis awareness, China can be said to have endured hardship and actively promoted civil exchanges between China and the US, including exchanges in academia and business, resolutely curbing the trend of decoupling.
So the success of DeepSeek is first built on the foundation of OpenAI, which is acknowledged by Liang Wenfeng himself, and secondly, precisely because the US thought it could block China's technology by using the "small courtyard and high walls" approach, it has led to a deviation of the young Chinese technology R&D personnel, achieving a major breakthrough in engineering technology and greatly reducing the dependence on computing power. It can be said that the most closed and conservative US since World War II has paid the price for its closure in the competition with China in AI, while China, by choosing the open-source DeepSeek, has won victory and respect.
The crux of the second view lies in the excessive belief in the "capable" ability of the government. If the local government clearly knew the value of DeepSeek, it should have given it a strong promotion as early as May 2024 when the V2 version was released, rather than waiting until 8 months later when it was certified by Silicon Valley engineers and Wall Street analysts. "Greatness cannot be planned", and going back to the background of DeepSeek's birth, its parent company is engaged in quantitative trading - a financial operation method that is not favored by the regulatory authorities. But what Hangzhou did right was to choose to let go of many unseen and ambiguous market behaviors.
In January 2024, the CSRC issued new regulations on securities lending business, including: 1) Suspending the lending of restricted shares in an all-round way; 2) Changing the real-time availability of the securities lending market-based declaration to the next day's availability, limiting the efficiency of securities lending. Some analysts believe that this will have the greatest impact on quantitative institutions.
Hangzhou is a stronghold of China's private economy development, with 36 companies on the list of China's Top 500 Private Enterprises in 2024, surpassing Shenzhen's 27 and ranking first among all cities. In developed private economies, in addition to the emergence of service-oriented governments, the emergence of limited governments is also required. As the saying goes, "when the water is clear, there are no fish", Hangzhou's past tolerance of P2P, although it has brought quite painful consequences, also reflects a precious tolerance for folk finance.
Over the past two years, by persistently promoting further opening up to the outside world and not disturbing the internal "letting the water flow and the fish grow", the Chinese technology industry has gained the opportunity to recuperate and even catch up, and has also unleashed unexpected energy. In addition to large models like DeepSeek, China is also accelerating breakthroughs in the basic technological capabilities of the semiconductor field.
According to the in-depth analysis report on the technical level of the three major key areas released by the Korea Institute of Science and Technology Planning and Evaluation (KISTEP) on February 23, the results of the questionnaire survey of 39 domestic experts show that as of 2024, Korea's technical foundation capabilities in the semiconductor field are lagging behind China in all key areas.
It is worth noting that the experts who participated in this questionnaire survey had also received the same assessment in 2022, and at that time they believed that Korea was leading in areas such as high integration, resistive memory technology, semiconductor advanced packaging technology, and next-generation high-performance sensing technology, but in the short two years, the situation has undergone a complete reversal.
At present, the Russia-Ukraine war has entered its fourth year, and this war has not only brought Russia into "wartime Keynesianism", but has also dragged the entire Europe into a quagmire of economic and technological stagnation. Interestingly, the Russia-Ukraine battlefield is the first large-scale use of AI technology in human warfare, with AI penetrating the entire chain of intelligence, decision-making, strikes, and public opinion warfare on both sides. It is against this backdrop that the current round of breakthrough in China's AI industry has shown invaluable value.
