Shenzhen’s AI Plan: Building a Tech Hub with Chips & Computing Power
Shenzhen, China’s technology hub, has unveiled a three-year plan to establish itself as a leading center for intelligent computing clusters, focusing on advancements in semiconductors, storage and AI servers. The initiative, published Monday by the Shenzhen Industry and Information Technology Bureau, aims for a substantial increase in the production capacity and shipment volume of the entire AI server supply chain by 2028.
The plan prioritizes boosting the global market share of key components, including chips, storage devices, printed circuit boards, power supplies, and optical modules. A central tenet of the strategy is achieving technological sovereignty, with a strong emphasis on domestic chip production.
Specifically, the blueprint supports the development of domestically produced graphics processing units (GPUs), central processing units (CPUs), and neural processing units (NPUs). It also champions the integration of the open-source RISC-V architecture – increasingly adopted by Chinese semiconductor companies as a means of circumventing U.S. Sanctions – with open-source operating systems like OpenEuler, and OpenHarmony. These operating systems were initially developed by Huawei Technologies before being contributed to the China’s OpenAtom Foundation.
The hardware development is explicitly intended to support AI model training and computing. This move comes as China seeks to reduce its reliance on foreign technology and bolster its position in the rapidly evolving artificial intelligence landscape. According to a report by Bloomberg in December 2025, China is considering an additional $70 billion investment in its domestic chip industry, which would be the largest government semiconductor investment by any nation. This potential investment aims to help Chinese companies compete with industry leaders like Nvidia and AMD.
The push for self-sufficiency in semiconductors is occurring against a backdrop of geopolitical tensions and export controls. A RAND Corporation report from June 2025 highlighted that U.S.-led export controls on AI chips and the equipment needed to manufacture them are limiting compute availability for Chinese AI developers. These restrictions force Chinese companies to balance immediate progress in model development with long-term resilience against sanctions.
Despite these challenges, China’s AI industry continues to grow, driven by innovation within its private tech firms and supported by state funding. However, the RAND report also notes inefficiencies in the allocation of AI chips, suggesting that state support isn’t always optimally deployed. A cybersecurity ban imposed by China in mid-2023 effectively prohibits Micron from selling to the Chinese server market, further illustrating the complexities of the geopolitical landscape surrounding the semiconductor industry.
Recent reports indicate ongoing efforts to circumvent these restrictions, with instances of chip smuggling continuing to be reported. In February 2026, authorities charged the co-founder of Super Micro Computer and two others with diverting microchips to China. The Shenzhen plan does not address these illicit activities, but focuses instead on building a legitimate, domestically-driven supply chain.