DeepSeek: Changing the game, not the leader

Chinese artificial intelligence (AI) startup DeepSeek has sparked widespread interest and adoption among local governments and enterprises in China. Interviewed academics believe that this development is considered revolutionary in China’s AI sector and has the potential to significantly enhance China’s future economic competitiveness. 

Even so, some Chinese scholars have also assessed that this development did not change America’s overall AI dominance, and called for a “calm and rational” response to DeepSeek’s success.

Over the past month, numerous Chinese enterprises, from auto manufacturing, ports, education, healthcare, e-commerce and telecommunications to search engines, have announced plans to adopt DeepSeek. According to incomplete statistics from Chinese media, over 200 leading enterprises completed technical integration and deployment.

Local governments in the provinces of Guangdong, Jiangsu and Shandong have also announced the integration of the DeepSeek large language model into their government service systems. Among them, Shenzhen’s Futian district launched 70 DeepSeek-powered “AI employees”, handling administrative work such as document processing, public services and investment attraction.

Lim Tern Poh, former associate director of AI Singapore, told Lianhe Zaobao that the adoption of DeepSeek among the Chinese government and businesses is primarily market-driven, rather than a top-down policy directive. He said that DeepSeek’s relatively low cost and compute requirements mark the arrival of a “cost inflexion point”, a crucial moment that enables organisations of all sizes to implement AI on a large scale and reap its benefits.

Taking Futian’s “AI employees” as an example, Lim pointed out that these AIs are able to draft official documents within seconds — tasks that would have otherwise taken days — and have achieved over 95% accuracy in formatting, cutting review times by 90%.

WeChat recently rolled out its “AI search” function, utilising DeepSeek’s “deep thinking” function. This implies that China’s largest telecommunications platform, with over 1.3 billion active users, has officially entered the AI era.

Zhu Feida, an associate professor at Singapore Management University’s School of Computing and Information Systems and recipient of the Aptos Move Professorship, said in an interview that WeChat’s integration with DeepSeek is revolutionary. It seamlessly integrates AI technology into the daily lives of ordinary consumers and significantly improves public awareness and experience of AI.

Zhu said that China has built a shared technological foundation by deeply integrating with DeepSeek technology through a unified platform. This synergy not only promotes wider application development but also accelerates the deep penetration of AI technology across all sectors of society.

He used the analogy of the popularisation of electric vehicle technology, pointing out that this popularisation strategy eventually achieved large-scale application by slowly guiding society and industries to embrace new technologies.

He said, “This is not only a breakthrough in technology application but also drives changes in social structures and modes of production. Business operational efficiency will be greatly enhanced, injecting strong momentum into the economy.”

In a mid-February report, the US’s Goldman Sachs predicted that the positive impact of AI adoption on China’s economy would gradually become evident from 2026 onwards. It is estimated that by 2030, AI technology will contribute a 20 to 30 basis point increase to China’s GDP.

“The recent emergence of DeepSeek…suggests faster AI development and adoption in China than we previously anticipated”, stated the report.

Zhu pointed out that China’s significant achievements in AI applications were well known. However, he also expressed potential concerns about China’s AI innovation ecosystem, suggesting that an excessive focus on applications might cause the development of foundational technologies to be neglected.

He said that while China has excelled when it comes to application in the past, it has not given enough focus to the development of underlying technologies. Nonetheless, Zhu pointed out that the recent emergence of companies such as the “Six Little Dragons of Hangzhou” indicated a shift in China’s stance towards the foundational technologies sector.

“In the future, China will not only continue to lead when it comes to applications, it can be expected to also be at the forefront of foundational technology innovation globally”, he stated.

However, Professor Zheng Yongnian, dean of the School of Public Policy at the Chinese University of Hong Kong (Shenzhen), wrote on 21 February that despite DeepSeek being a milestone innovation breakthrough, it has not altered America’s leading position in overall AI technology and data.

He said, “DeepSeek is the result of open-source collaboration; not a foundational innovation that came from nothing, but rather an innovation at the application end… In terms of technology and data, there remains a significant gap between China and the US, and the gap when it comes to applications is also significant.”

Zheng assessed that future competition between China and the US in the AI sector will intensify, particularly when it comes to technology innovation and application. To face this challenge, China must continue advancing its open-source strategy while appropriately relaxing regulations to facilitate faster technological implementation and application.

AI-driven automation and intelligent technologies have significantly enhanced productivity and reduced labour costs. However, these advancements also mean that there is a risk AI will replace certain traditional jobs, thereby putting pressure on the job market.

Lim pointed out that AI’s impact now extends to all workers, creating unprecedented vulnerability for professionals, just as industrial automation in the 18th century disrupted blue-collar jobs.

He said that “roles such as finance analysts, accountants, content writers and customer support representatives are at the forefront of automation, as these positions often involve repetitive information processing — an area where DeepSeek excels”.

Zhu agreed that the accelerated application of AI could exert some short-term pressure on employment. However, he emphasised that the proliferation of AI technology has not only created emerging professions like AI development, data analysis and algorithm engineering, it has also invigorated the labour market.

At the same time, the application of AI has increased the demand for highly skilled talent, driving the workforce to enhance their skills through retraining and education to adapt to changes in the employment environment.

He added that “historically, technological progress has always been accompanied by the emergence of new opportunities. The proliferation of AI technology is undoubtedly positive for both the society and economy, providing more impetus for economic growth, creating more job opportunities and improving lives in the long run.”

This article was first published in Lianhe Zaobao as “DeepSeek掀起接入潮 重塑中国经济格局”.

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