Shanghai to Raise $15 Billion to Fuel World Leadership in AI

Shanghai to Raise $15 Billion to Fuel World Leadership in AI
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The city government of Shanghai is seeking to draw investors to bring in capital and the necessary talent to manage the money in a move to become a notable technology hub.

To accomplish its endeavors, Shanghai is looking forward to setting up investment funds amounting to at least 10 billion Yuan, which is equivalent to 15.1 billion US dollars in the next two-three years.

The money will be intended to help improve the development of enterprises that are related to artificial intelligence (AI) technologies.

Recently, Chen Mingho, the head of the Shanghai Commission of Economy and Information Technology said during a press conference that the municipal government was seeking a way to attract additional public investors for both the finances and the recruitment of high-value asset managers required to run them.

Chen Mingho also asserted that the size of 100 billion Yuan in financing might not be adequate to back the development and growth of artificial intelligence (AI) technologies. Nevertheless, he proposed the successful mobilization of all public resources in a bid to develop AI-based enterprises collectively.

For some time now, Shanghai has been struggling to regain its prestige as a well-known driver of the Chinese economy by stimulating growth in both the information technology and finance industries. What’s more, the city leaders have proposed the building of Shanghai’s Internet behemoths, which are at par with the BAT companies including Baidu, Alibaba and Tencent Holdings.

Despite giving some insight on the vision of Shanghai, Chen failed to elaborate further on the sources of the massive amount of funds. However, the government is expected to offer the seed capital before bringing together well-known private equity fund managers and venture capitalists to take part in the asset management and fundraising exercise.

Cao Hua, Unity Asset Management’s partner, said that talent, policy incentives and capital would serve a key role in turning Shanghai into a real innovation hub. However, he also said that the competition is stiff, as other Chinese cities are also seeking to lure more budding startups and technology giants.

In 2015, Shanghai put in place a loss-proof plan intended to keep afloat the investment provided by venture capital funds and angel investors. An investor or fund could recover a maximum of 3 million Yuan of losses from investments in Shanghai startups.

Currently, in the northeastern Yangpu district of Shanghai, eligible foreign experts working for tech companies based within its 2.3 million square meter innovation region are being granted permanent residency. The city is also providing affordable rental homes to both skilled IT developers and engineers at startups in a bid to lure talent from all over the world.

In 2017, Shanghai started creating a national electronic platform intended for trading data such as personal credit details amidst increasing demand for data collection as the country and city aim to be an international technology superpower.

In fact, Keyan Tang Qifeng, the CEO of Shanghai Data Exchange Corp, said that the data trading market is anticipated to hit 100 billion Yuan in 2020.

Source SCMP

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