China is rapidly expanding its network of data and computing centers across the country as part of its broader strategy to bolster artificial intelligence (AI) capabilities. Unlike the United States, where local communities often resist the establishment of data centers due to concerns over local resources and environmental impact, Chinese regional governments are actively courting such investments, including in remote and less-developed areas.

Recent announcements highlight the scale and ambition of this expansion. In Shatian, a small town in Guangdong province, authorities revealed plans to invest 100 billion yuan (about HK$15.18 billion) in constructing a large data and computing park spanning 3,642 hectares on a previously undeveloped island, with completion targeted by 2030. Similarly, Jiashan County in Zhejiang province has inaugurated the first phase of a 5 billion yuan data center designed to deliver 15,000 petaflops per second of computing power—a capacity expected to double upon full completion. This center aims to support next-generation AI training and advanced fields such as molecular and drug development, reportedly offering computing speeds surpassing traditional U.S. supercomputers.

Jiashan has become a growing hub for data infrastructure, hosting facilities operated by major players including Alibaba Group Holding and China Telecom. In Jiangsu province, the city of Yangzhou has commenced construction of a hyperscale data park with an anticipated capacity of 30,000 petaflops, backed by Tencent Holdings and China Telecom. Additional centers are under development in central and western regions such as Hunan, Xinjiang, and Inner Mongolia, where Ulanqab is building a 30 billion yuan computing facility.

Experts caution, however, that this rapid buildout risks creating an oversupply of infrastructure. Tang Dajie, a senior researcher at the China Enterprise Institute think tank, described some local investments as "irrational," driven by officials’ performance targets rather than careful planning. Tang contrasted China’s government-led approach with the U.S., where data center projects often face scrutiny from local authorities and residents concerned about grid strain and carbon emissions. Several U.S. states, including New York, Virginia, and Ohio, have restricted data center development in response to these concerns.

Despite potential overbuilding, proponents argue that expanding AI infrastructure is necessary to maintain China’s competitive edge. The “east data, west computing” national policy, initiated in 2022, aims to shift data processing to western inland provinces, which feature lower electricity costs, ample land, and favorable climates, while serving the computing demands of the densely populated eastern coast. This approach reflects a coordinated effort to optimize resources across regions.

Xu Jingbin, a researcher at the Zhejiang Industry and Information Technology Research Institute, noted that as generative AI increases demand for computing power, controlling affordable, high-performance infrastructure provides a strategic advantage in the global technological rivalry. Xu also emphasized China's capacity for synergy between government and industry, a factor he suggested is less apparent in the U.S. system.

Overall, while China’s accelerated development of data centers reflects its determination to lead in AI technology, concerns remain about the sustainability and efficiency of the rapid expansion. The outcome could shape how both China and the United States compete in the increasingly pivotal field of advanced computing.