Tech adoption underpins positive outlook

Chinese companies' embrace of new technologies has given them a more positive outlook on their development prospects, according to global market consultancy EY's Growth Barometer report released on Tuesday.

According to the latest survey, about 43 percent of the Chinese companies interviewed predict their annual turnover growth will be above 10 percent this year, which is higher than companies in the rest of the world. This also exceeds the International Monetary Fund's forecast for China's annual GDP growth rate of 6.6 percent this year.

Another 45 percent of the Chinese companies interviewed believe their income will increase between 6 and 10 percent this year.

A total of 2,766 C-suite executives from companies in 21 countries and regions were interviewed for the survey. The annual income of these companies ranges from $1 million to $3 billion.

The greater importance attached to technology is one major impetus of Chinese companies' growth. Nearly one-third of the Chinese companies interviewed believe that technology, including artificial intelligence, is the major contributor to improved productivity.

As EY found out, Chinese respondents lead their global peers in the adoption of AI technology, with 10 percent already using it compared with 6 percent globally. A majority of 77 percent of Chinese respondents said they will introduce AI into their operations within the next two years, while the number is 66 percent worldwide. Almost 99 percent of the surveyed Chinese companies said they will have adopted AI by 2023.

Li Kang, TMT assurance partner at EY China, said that the wider adoption of AI among Chinese companies is the most noticeable turnaround on last year, as 91 percent of the polled Chinese companies then said they would never use the cognitive technology of robotic process automation.

The proliferation of AI can be partly attributed to the central government's emphasis on new technologies, Li said. The State Council released the AI development plan in July last year and five months later the Ministry of Industry and Information Technology announced five months later a guideline for AI industry development between 2018 and 2020.

"This shift, while reflected across the world, is more significant in China," said Li, suggesting companies invest in the more cutting-edge areas of new technologies in order to create new business models and improve customer experience.

But Chinese companies are concerned about external risks that might have a negative impact on their growth. About 46 percent of the Chinese respondents cited slow or flat global growth as the greatest risk for their growth, which is 41 percentage points up from a year earlier. Only 24 percent of the respondents from other parts of the world believe a global economic slowdown will be a major concern.