China, Technology, and the Pursuit of a Global Dialogue: An Interview with Zhang Yajun

Yajun is the founder of Zhang Global Advisory (君略全球 ), a boutique strategic communications firm whose core mission is to help China’s tech founders and executives build credible global profiles. She previously spent seven years at the World Economic Forum in a variety of roles. Prior to the Forum, Yajun spent nine years in corporate communications, first at Brunswick Group, where she led international communications for JD.com’s NASDAQ IPO, which was the largest Chinese listing in the US at the time. From there, she was a founding member of Foote Group, a boutique firm advising the first generation of China’s tech giants — Tencent, Baidu, JD.com, Trip.com, iQIYI — on their international positioning and cross-border reputation. Prior to that, Yajun was a reporter and researcher at the Christian Science Monitor. Yajun graduated from Peking University and studied at Université Bordeaux-IV in France. Her Substack can be found at this link.  

Q1: Please introduce yourself and tell us about your current interests.

My name is Yajun Zhang. I have spent the last 18 years working at the intersection of China’s technology ecosystem and global institutions and watched China develop from the “World’s Factory” to a global technology architect both from the inside and from a perspective living and working outside of China.

I recently founded Zhang Global Advisory focusing on bringing the voices of Chinese AI and robotics companies to the global stage and helping international audiences better understand the rapid technology and social transformation in China. The reason I’m so passionate about this is that I observed firsthand a gap at the highest levels of global dialogue. Half the conversations are about China, yet very few Chinese voices are actually in the room to explain what is really happening. Chinese founders have the capability to engage at the international level, but there are real systemic and access barriers at play. I want to help fix that.

Before launching the firm, I spent seven years at the World Economic Forum. In my first five years there, I was responsible for designing and delivering China-related programs and content for flagship events like the Annual Meeting in Davos and the Annual Meeting of the New Champions, known as the Summer Davos in China. In my final two years at the Forum, I moved to WEF headquarters in Geneva and led the content design of the Global Collaboration Village, an Extended Reality initiative founded at the direction of Professor Klaus Schwab, founder of the World Economic Forum. This initiative leveraged frontier technology to help prime ministers and presidents use Apple Vision Pro and Meta Quest headsets to viscerally understand challenges in critical global issues, such as climate change and advanced manufacturing.

Q2. Although you’re from China originally, you spent a couple years working in Switzerland. Please share your experiences living there and what you found most enjoyable and frustrating about that culture and society.

Indeed, I lived in Switzerland for two years, and when I was younger, I also lived in France for two years. Those European experiences gave me a very different perspective. Switzerland is, without question, one of the most beautiful countries in the world, but I was also impressed with the level of social trust in the country.

For example, we needed a plumber to come to our apartment and fix something, but I was at the office. The plumbers left a note saying: “If you can’t be home, just leave your key with us.” I would never hand my house key to a stranger in any other country. In Switzerland, that’s just what they do. I left the key. When I came home, it was placed neatly on the desk, and everything was spotless. I was genuinely moved by that.

The equality aspect also surprised me. In China or in the US, seniority comes with visible markers like private cars, drivers, and entourages. In Switzerland, I regularly saw the most senior executives at the World Economic Forum taking a crowded public bus alongside junior staff, and everyone seemed completely at ease with it.

I remember a president of a leading Chinese university remarking to Professor Schwab that what struck him most about Davos was not the prestige of the participants but walking down the Promenade and seeing heads of state and Fortune 500 CEOs carrying their own bags and walking in the snow, completely anonymously, like everyone else. That’s just what you do in Switzerland.

That’s why, every time I gave a briefing to Chinese executives about participating in Davos events, I had to prepare them and make it clear that this was likely to be a very different experience from what they were used to or expecting. From a logistics perspective, attending Davos isn’t easy. The only way to get in is by slow train. The lodging is super small and expensive compared with a conference in China. Forget about cars. The traffic on the Promenade during the event is awful. The easiest way to get around is just to walk in the snow. That’s what Professor Schwab, who is 88 years old, and many other global leaders do. I love that kind of leveling.

Like all countries, Switzerland has its frustrating aspects, too. Switzerland is relatively conservative when it comes to digitalization and technology, and that was a genuine shock. Official documents must be sent by registered post. I had never set foot in a post office before moving to Geneva, and suddenly I was there every week. Everything runs on paper and through formal processes. I understand this is a conscious cultural and political choice, and people are genuinely happy with it. I respect that. I totally understand that people have different priorities and are more aware of their data privacy. But it is very different from what I have seen in China where people love, even “worship” technology. I am not the one to judge which direction is better or worse, but my Chinese DNA inclines me to the side of adopting technology. That’s why I was quite sure I wanted to focus this stage of my career on China and Asia.

Q3. For more than 6 years you worked at the World Economic Forum. For those unfamiliar with the organization, what is its purpose and what was it like working there as a mainland Chinese? What was the general level of understanding of China among the political leaders and business elite you met?

Professor Schwab founded the Forum with a vision to improve the state of the world through public-private collaboration. That mission genuinely attracts remarkable people. Many of the colleagues I worked with were deeply committed to making a positive difference on issues like climate change and AI governance. They are smart, grounded, and cared about the big picture. Despite leaving the Forum, I remain grateful for what it gave me, and most of all for the people.

Working there as a mainland Chinese carried two dimensions. On one hand, it was a genuine honor to serve as a bridge between China and the rest of the world. The Forum has one of the warmest institutional relationships with China among major international organizations. Chinese Premiers attended Summer Davos or online dialogues every year for 19 consecutive years, even during the COVID period. President Xi attended the Annual Meeting in person in 2017 and gave online remarks in 2021 and 2022. These aren’t small gestures; they signal real strategic importance.

I oversaw the design and delivery of all China-related sessions and speaker recommendations. I didn’t take my responsibility lightly, as I understood how important it is to choose the right person to talk about the right topics. For example, when China’s technology needed to be explained, I curated the session from a position of actual knowledge and cultural fluency rather than secondhand interpretation. I brought in the most relevant people with the deepest China knowledge that I could, people who I knew could translate the reality in China to a Davos audience.

The best illustration I can give is something behind the scenes. When I designed the Ren Zhengfei-Yuval Noah Harari session at Davos 2020, the negotiation involved both sides. It was one of the very few times, if not the only time, that Mr. Ren had ever spoken at Davos, and the company had just been put on the US blacklist. Moreover, Harari is not a technology optimist, and this added another level of complexity in designing the session. I was responsible, and it wasn’t easy, for getting everyone to agree on what could be said, how questions would be framed, and what the format would look like.

Chinese officials and executives are extraordinarily careful about managing exposure in international settings. They have a lot to say but are concerned about what might happen if they say the wrong thing or are quoted out of context. The risk is much higher for them than for their Western counterparts. So, you design differently. And when you design well for that constraint, you get something extraordinary, like the Ren Zhengfei-Harari session, which can still be found online six years later, and is worth watching.

On the other hand, managing that relationship between China and the rest of the world required constant navigation. Even as a Chinese person representing an international organization, I had to negotiate carefully between what Beijing needed and what Geneva expected. Personal trust with counterparts matters enormously in that role. This is not a challenge unique to the Forum. Every China branch of a multinational company faces the same difficulty, aligning the complex reality on the ground in China with the expectations of global headquarters.

As for the general level of understanding of China among world leaders and business elites, I would say it varied widely. Since Donald Trump’s re-election in 2024, geopolitical uncertainty has increased, but I’ve sensed growing interest in China and Asia by senior figures, business leaders, and world leaders, who are curious about China, feel China matters, and want to understand the country better.

However, people’s opinions tended toward one of two extremes in the “China narrative.” You would hear two versions of China: the authoritarian surveillance state on one end, and the technological utopia living twenty years in the future on the other. Both contain elements of truth; neither captures the nuance. The genuine diversity of Chinese entrepreneurial culture, the policy-to-implementation gap, and the role of local government versus central government were almost entirely absent from the conversation, even among very senior global leaders.

China is complicated. I was born and raised in China, and I cannot even claim to know it. I only know the environment and the people that I engage with. I don’t know what it’s like to be a shopkeeper in Anhui province, for example. I worry that a lot of so-called experts on China have the wrong perception and lead with stereotypes rather than real on-the-ground observations.

What I found most striking was not hostility. Most people were genuinely open to learning about China, but the extent to which the China conversation at any level was shaped almost entirely by people who had never worked inside the system was a concern. The absence of authentic Chinese voices capable of explaining in a second language this kind of complexity to global leaders was, and remains, a serious gap. That gap is precisely what drives both my content work on LinkedIn and Substack and my vision with Zhang Global Advisory.

Q4. While at WEF, you also interacted with Chinese government officials. How do they view a forum like WEF and what was your experience working with senior Chinese officials?

The Chinese government views the Forum as a strategically valuable platform. It is one of the few international stages where China can speak directly to the world’s decision-making class. Senior standing committee members go to Davos every year and typically deliver a keynote address during prime time on Tuesday morning, right after the opening speech. The message is consistent – China is committed to opening up, globalization, and free trade.

My experience working with Chinese senior officials was genuinely nuanced and very personal. I found significant generational differences. Younger officials — many of whom had spent years working at Chinese embassies abroad, spoke fluent English, and engaged with the world curiously — were impressive and a pleasure to work with. The older generation sometimes brought a more top-down style that required different kinds of navigation. In every case, the personal relationship and trust were foundational. Even though I’m Chinese, I was representing an international institution, which added a layer of complexity that required real skill to manage.

In my experience working with senior Chinese officials — and I want to be careful here not to reduce a diverse group to a monolithic description — they tended to be more strategically sophisticated than their Western counterparts assumed, and less personally ideological than the Western discourse often implies.

The officials I interacted with who were responsible for technology and innovation policy were frequently well-informed about global developments, sometimes more so than their Western peers. What is worth understanding is how sophisticated local government officials have become in this space. They compete fiercely with each other to attract promising tech firms, and digitalization of government services is a major KPI, so many of them have developed genuine in-depth knowledge of the latest technology and innovative business models. A good example is Longgang District in Shenzhen that issued a policy in early March to attract companies leveraging OpenClaw, an agentic AI tool, to relocate to the district, with real monetary incentives of two million RMB. The rest of the world had probably never even heard of OpenClaw at that point.

Another observation is that you often know what Western officials think about any topic because they openly share their views, but you rarely hear Chinese officials’ opinions in public settings. They come to the main stage and read a pre-approved script. That’s how they operate. However, privately, many of them are very knowledgeable about the global situation and view things through a Chinese philosophical lens.

One moment that has stayed with me was when I discussed climate change with a Vice Minister, and his framing was unlike anything I had heard. He drew a parallel to the climate cycles of the late Ming dynasty, a period marked by the Little Ice Age, when extreme weather, prolonged droughts, and crop failures contributed to the dynasty’s eventual collapse. He argued that history is long and that we are in the middle of a natural cycle whose full arc we cannot yet see.

His point was not to dismiss climate change, he was not a denialist, but to question the instinct to control and correct nature’s course. His view was that humanity should first seek to understand and respect the principles of nature before assuming we can engineer our way out of them. 顺应天时 — align with the timing of heaven. It is a deeply Daoist philosophy, and honestly, it resonated with me.

Q5. More broadly, what do you think about Western-driven platforms like the WEF, and do you see them as relevant in the coming years, particularly for an economy as large as China’s? Do you see a need for new structures or platforms that better reflect China’s and Asia’s interests?

This question comes up every year at Davos, almost on cue. After 56 years, the institution is still there, so as a platform, the Forum is clearly still relevant. But “relevant to whom?” is the right way to frame it.

I’m grateful to the Forum, and I’m a genuine believer in its vision of improving the state of the world. It also tries hard to bring Chinese voices into the discussion, but its structure doesn’t fit China’s way of working, and Global South voices remain structurally underrepresented. This isn’t a matter of deliberate exclusion. It’s a legacy problem.

The Forum was built on Western frameworks and long-standing relationships with Western institutions. Language is a barrier as most sessions are conducted in English. The preferred engagement format of open workshops, extended debate, and facilitated dialogue doesn’t align well with how senior Chinese leaders like to operate. They tend to prefer alignment and execution over prolonged open-ended discussion. Chinese business culture is rather deeply outcome-driven, and if two sessions of Forum dialogue produce no tangible results, Chinese participants stop coming back.

At the engagement level, China will continue to participate because the alternative, complete absence from major international conversation spaces, carries costs that outweigh the frustrations. Chinese officials and business leaders are sophisticated enough to use these platforms selectively without being captured by their framing. But if you look at the direction of China’s 15th Five-Year Plan, there’s a clear tendency to set its own agenda rather than follow established Western frameworks. China is participating in WEF but also investing heavily in the China Development Forum, Belt and Road forums, BRICS summits, and bilateral dialogues that operate entirely outside the Western institutional architecture.

Do I think we need something new? Honestly, yes. This is not a criticism of the Forum’s value, but the global order and power dynamics have changed completely from 55 years ago, when the Forum was founded. The post-1945 global governance architecture is fraying and the multilateral institutions built to uphold international norms have struggled, sometimes visibly, when confronted with incidents that challenge those very norms. The majority of people in the world live outside Europe and North America, and yet their voices remain structurally underrepresented. The need for new frameworks for global dialogue is louder now than at any point in my career. I think it’s time to respond to it seriously.

Q6. As someone who sits between China and the West, what do you think Western commentators and journalists get wrong about China and what are some of the common misconceptions that you find most frustrating? Conversely, what do Chinese commentators get wrong about the West?

A common problem in the West is conflating the Chinese government with the Chinese people. To be fair, Chinese leaders and state media often do the same thing in the name of political unity, but the reality is obviously far more complex. Conflating the people with the political class produces a distorted picture. “China does X” or “Beijing wants Y.” There are 1.4 billion people, 300-plus prefecture-level cities, an enormous diversity of regional cultures, businesses, and local governments that all have their own interests.

Sometimes I joke that if you talk to 1,000 Chinese people, you will get 1,000 different versions of the China story. China’s policy implementation is heterogeneous as well. What happens in Shenzhen’s robot-friendly innovation zones is different from what happens in a third-tier city in Shandong. What a private tech entrepreneur in Shanghai thinks is different from what a State-owned Enterprise (SOE) executive in Beijing thinks. Western coverage sometimes flattens all of this into “China.” The result is coverage that largely misses some important nuances.

I once read an article about how Chinese tech companies were setting up police stations on their campuses. The article cited it as evidence of tightening government surveillance in the private sector. But if you know China at all, you know that in any area with tens of thousands of people, a large factory campus, a business park, having a small police post is pretty common, if not ubiquitous. It’s the equivalent of building security or campus police. The story wasn’t wrong on the facts but perhaps applied a Western framework to a Chinese reality.

Another failure is assuming that everything Chinese institutions do is for ideological reasons. Pragmatism matters, too, and is sometimes even more important. China’s technology policy is a complex mix of genuine industrial strategy, local government competition for investment, and entrepreneur-level incentive structures. Is there ideological direction and political oversight? Sure. That’s China. But how much direction and oversight varies by sector and level.

Something I observed firsthand on a recent trip through China is worth adding here. At least two local officials told me that their top KPI right now is helping Chinese companies go global and attracting foreign investment into their district. Their performance is evaluated on real figures, on a quarterly basis. That means they are scrambling to find practical solutions to whatever problems their local companies are facing. These include logistics disruptions caused by the conflict in the Middle East, market entry research for new geographies, regulatory navigation in unfamiliar markets, etc. All of this is real ground-level, outcome-driven government support for internationalization, operating at a speed and specificity that even I found surprising.

A third failure, and in some ways the most damaging, is outdated knowledge. China operates at extraordinary speed, from government to business. If you haven’t been on the ground for a few months, your knowledge is already stale. Yet many global leaders still operate on information they acquired during a posting or visit in 2017, or earlier, assuming it remains relevant. It doesn’t. I’ve seen this play out in real consequences with executives giving wrong instructions to their teams on the ground, or challenging local judgment based on a China that no longer exists. In a market moving this fast, confident ignorance is more dangerous than acknowledged uncertainty.

There’s also a shortage of genuine expertise. There are people who know China well, speak and read Chinese fluently, and offer nuanced analysis, but many who present themselves as China analysts who speak very basic Chinese or no Chinese at all, or have spent little time in the country in recent years. They’re drawing conclusions about what’s happening on the ground from 33,000 feet in the air. I have to admit that when I see a Western pundit on social media write or talk about “what I’m hearing from my Chinese contacts,” maybe it’s unfair, but I hear “What my intern pulled off of Weibo or scraped from a WeChat group, and I translated it in Claude.” China moves so fast that even I, as a Chinese person who grew up there, still need to visit China regularly just to keep up. If you’re not on the ground, you’re already behind.

The problems on the Chinese side are distinct and lead to their own distortions. Commentary about the West often gets flattened and generalized. America, Europe, and Canada are treated as a monolith, but have very different priorities and concerns. And many Chinese observers mistakenly believe that foreign media coverage of China is always politically motivated, that any negative reporting is driven by hostility toward China. What they miss is that foreign media criticize their own governments just as aggressively. Skepticism is the default setting.

The deeper failure I observe is underestimating how genuinely messy and contested Western democracies are. It’s easy to misread messiness as weakness. Western institutions can be slow, and they sometimes produce outcomes that seem suboptimal. Chinese observers interpret this as a sign of structural fragility, while overlooking the capacity of these systems to self-correct. Different opinions about policy direction and an inefficient decision-making process are a feature, not a bug.

Chinese commentators underestimate how often Western skepticism about China is driven by values. Things like the rule of law, individual rights, and the treatment of minorities are important. It’s not (only) cynical geopolitical calculations. Dismissing it entirely as posturing misreads what is actually motivating a significant portion of Western policy and public opinion.

The common thread on both sides is a failure of curiosity about complexity. Both systems are more interesting, more contradictory, and more capable of surprise than either side’s dominant narrative allows.

Q7: You worked with the first generation of China’s major tech companies. What were those founders like, and how have things changed with the new generation?

I worked with some iconic names from that era, that’s for sure. I helped JD.com and iQIYI list on NASDAQ. I supported Baidu and others with international communications and worked with many other clients to build global profiles. That generation was extraordinary – driven, fast-moving, and remarkably quick learners.

When I first started working with JD.com in 2012, it was still called 360buy at the time. They were essentially a domestic Chinese platform with almost no international presence. Within two years, they completed the largest Chinese IPO on NASDAQ at that point. The speed of transformation was breathtaking.

Those companies were operating in a period of enormous optimism and frontier energy. The founders had identified opportunities that no one else had seen and market gaps. The appetite for speed and iteration, for being willing to fail. It was impressive. Many of these companies outperformed their international competitors. Why? Because Chinese companies understood better what local consumers actually wanted. Alibaba over eBay is an obvious example, but you saw the same pattern play out in sector after sector.

That generation was still fundamentally “made in China,” and their core market was domestic. International engagement was about attracting investment and building credibility with global investors. Going global was nice, but not an existential or strategic imperative.

This new generation is completely different. Many of them are leading the “created in China” wave. The founders are often in their twenties or thirties, educated at top international universities, and building global-native companies from day one. Their products are designed for international markets first, not adapted for them later. That means they are closer in mindset to early Google or Facebook than to the JD.com of 2012. Internationalization is the core of the business model.

The structural push is also different now. The domestic market is increasingly saturated, and with the productivity surplus that AI is generating, China’s products, services, and technology will naturally spill outward.

The broader context has inverted too. In 2010, Chinese tech companies were trying to learn from and connect with the West. In 2026, the question is more often how global markets adapt to what China has already built. That’s a fundamentally different strategic challenge and it’s a big part of why I founded Zhang Global Advisory when I did. There is a new wave of AI, hardware, and robotics founders whose challenge isn’t product quality. Several companies I’ve spoken with now derive more than half their revenue from overseas markets, yet many of them were founded in the last two to three years.

Despite impressive market valuations, their management structures and internal infrastructure still operate like startups. The ambition is global but the institutional maturity hasn’t caught up. What they need is support on overall strategy and narrative infrastructure, such as how to establish credibility, build long-term trust, and create the conditions that allow genuinely world-class companies to be recognized as such on the world stage. That gap between what they have built and how the world perceives them is exactly where I focus my work.

Q8. The Chinese and US tech ecosystems share a similar trait that can be frustrating to people who understand how entrepreneurship and tech start-up life really works. This is the glorification of a small handful of winners and successful giants. For every success story, there are thousands of entrepreneurs who never made it, but their struggles are not considered newsworthy. This creates a false narrative that ‘winners’ just worked harder than everyone else or were somehow unique, when in reality there are luck, timing and other factors. Is any of this discussed in Chinese tech circles and what are your thoughts on this as someone who has covered and worked with the success stories?

Failure is underreported, but I feel like it’s more present in conversations than it appears from the outside. Many of the most successful Chinese entrepreneurs didn’t succeed on their first attempt. They failed many times before landing on what worked. In my experience, though, it’s when they’re successful that they become more willing to discuss those earlier stumbles. That openness, when it happens, takes real courage. Within entrepreneur communities, people do talk about failure informally and candidly, and the willingness to show vulnerability is growing. And I think that’s valuable for giving the next wave of founders a more realistic picture of what it actually looks like to build something.

There’s a structural reason why failure gets normalized in China’s tech ecosystem. The speed of the market forces it. Companies build a prototype, put it into the market, and then within weeks, they gather feedback, and either iterate or pivot entirely. The market moves so fast that a product that doesn’t work has to be abandoned quickly, and the team moves on.

What the public narrative does poorly is the coverage. The asymmetry is extreme. Ren Zhengfei’s early years at Huawei or Jack Ma’s founding story get told and retold because they fit a narrative arc of perseverance rewarded. What you don’t see are the equally representative stories of people who worked just as hard, made reasonable decisions, and ran into a regulatory shift, a funding cycle turning at the wrong moment, or a competitor with better distribution relationships.

What I think is particularly misleading in the Chinese context is the role of timing and policy alignment. Many of the companies that became giants did so in part because their business models aligned with where the regulatory environment was heading, or because they were in the right city when the right local government officials were looking to champion a sector. It’s a fundamentally different story from “they worked harder and saw things others missed.”

The deeper issue is that this mythologizing serves incumbent interests. The narrative that success is primarily about exceptional individual vision and execution is very convenient for people who have already won, because it attributes their position to intrinsic qualities rather than structural advantages that others could legitimately question. I’m not cynical about the people I’ve worked with — many of them are extraordinary. But extraordinary people fail all the time, for reasons that aren’t their fault. We should talk about that more.

Q9: In your Substack article/video about the invisible logistics behind Chinese New Year, you described how technology has reshaped how families celebrate. What does this tell us about technology adoption in China more broadly?

Of all the things I’ve written, the Chinese New Year piece was the one that really helped clarify a few things for me. What I mean is that it forced me to look at something so normal in China that most people actually don’t even think about it all that much. The article was about the scale of change within a single generation. My parents’ generation would spend two or three weekends preparing for Chinese New Year — planning what to buy, making trips to multiple markets. For this New Year, my mom ordered Boston lobster, Malaysian durian, and Chilean cherries with one click and had them delivered in thirty minutes. They arrived cold, on time, and at her doorstep. She didn’t think this was remarkable. She just said the cherries were sweet.

That absence of reaction is an interesting data point. You could argue that when a logistics system is reliable and operating at scale, it should be functionally invisibly. It goes from being technology to becoming infrastructure. And a good definition of infrastructure is what you only notice when it fails.

What makes China unique in this regard is its infrastructure and investment, but also its people. Chinese consumers have an extraordinary appetite for novelty, an extremely high tolerance for trade-offs between data privacy and convenience, and a deep appreciation for seamlessness. That combination creates a self-reinforcing feedback loop: companies invest heavily to make technology invisible, which drives higher adoption, which attracts more competition and investment. This didn’t happen because of top-down policy mandates. It happened because Chinese consumers demanded it, and the competition to serve them is more intense than anywhere else on earth. The Chinese consumer is arguably the most demanding in the world.

AI adoption is following exactly the same pattern. China’s current Five-Year Plan treats AI as foundational infrastructure, almost like electricity. The application development and hardware adoption are already moving faster than anywhere else.

Q10. The Citrini Research piece was a highly cited report in Western financial circles and while you can debate the merits and substance of its arguments, it posits a rather ugly future for knowledge workers. What are your thoughts on how AI is being adopted in China and if you think the scenarios laid out in that piece are relevant?

Citrini Research published a piece in February of this year called “The 2028 Global Intelligence Crisis”. It was a ‘speculative memo from the future’, not a prediction, but it alarmed many people, including the markets. It hypothesized a future in which AI agent adoption triggers mass white-collar unemployment, leading to collapsing consumer demand and collapsing markets. In the wake of the report, there was a tangible sell-off, but then Citadel Securities and a few others pushed back with more measured, balanced analysis and their own scenarios.

But when we look at those risks in the context of China, I think there is a structural mismatch that makes the report less relevant for the future of AI on the Chinese economy and society. Citrini’s scenario assumes a white-collar-heavy economy with deep enterprise software penetration, where AI agents can substitute for knowledge workers at scale. The displacement feedback loop — company cuts headcount, displaced workers reduce spending, margin pressure drives more AI investment, repeat — works in that context.

China’s employment structure is quite different. White-collar knowledge workers in genuinely competitive private sector roles, the category most exposed to Citrini’s scenario, represent a much smaller share of total employment than in the US. A significant portion of China’s “white-collar” workforce sits in government organs and state-owned enterprises, which operate under different incentive structures. You don’t cut headcount at an SOE for margin efficiency in the same way you do at a US software company. That’s a structural buffer.

Additionally, China’s economy is much more manufacturing heavy. Manufacturing employment is facing automation pressure, but that’s a different dynamic from the white-collar displacement the piece describes. The timeline and texture of disruption are distinct.

Where I think the Citrini scenario is genuinely relevant to China is at the margin of the private sector tech and services economy — particularly in tier-one cities. Young graduates who were expecting to find knowledge work in tech, finance, or consulting are already facing a compressed job market. AI is not the primary cause of that compression yet, but it will increasingly be a contributing factor.

The Citrini scenario is worth reading because it forces us to ask critical questions about what happens to consumption when productivity gains accrue to capital rather than labor. That question is relevant to China, especially because rising household income and consumption are critical to the continued health and growth of the Chinese economy.

Ultimately, AI may accelerate some dynamics that already exist. That’s worth tracking. Even if those changing dynamics don’t lead to a worst-case, doomsday scenario.

Q11. One point you have made before is the role of SOEs and the government sector in China as employment ‘shock absorbers’ for disruption to the economy caused by AI and other economic transition pains. What do you mean by this and is it still feasible as local governments find themselves under budgetary and debt strains and corporate profitability remains low?

The shock absorber argument is real, but it has limits. So, understanding both the mechanism and those limits is essential for anyone trying to read China’s economic resilience accurately.

China’s public sector, including SOEs, government agencies, and public institutions such as universities, hospitals, and policy banks, has historically been a backstop for employment. The private sector might respond to economic headwinds by contracting, trying to get leaner and more aerodynamic, but the state sector is less responsive to economic fluctuations. It doesn’t mean that they don’t have the pressure to be profitable, actually many do, and it can be intense. One of my mother’s friends recently resigned from a senior role at a national bank because her KPIs had become simply unachievable. But what the state sector is far less likely to do is launch large-scale layoffs of the kind we routinely see in the private sector.

There might be an ideological commitment to protecting the workforce, but much of it comes down to incentive structures and how they affect decision-making. Managing an SOE means budgets and profits, but SOEs and their managers are also measured by metrics like preserving social stability, so laying off people to improve margins is not necessarily rewarded the same way it might be for management in a private company.

During the tech-sector contraction of 2021–2023, regulatory tightening hit the online tutoring and gaming sectors hard. People lost jobs. Many of those workers began looking to the public sector for employment stability. Lower pay, but lower risk, and often better benefits. Many recent graduates followed the trend. Young people who a decade ago would be sending CVs to up-and-coming private tech firms or start-ups began studying for the civil service exam. The impact of sudden regulatory swings, like the ones that affected gaming and online tutoring, on unemployment was real and visible, but the shock perhaps didn’t hit as hard as it would have in a purely market economy. This was partly because there were alternative employment opportunities in the public sector.

But for how long? And is there a limit to how much the public sector can provide as an alternative to private-sector employment? These are important questions, especially because many local governments and the public institutions that rely on local funding are facing structural problems that lead to deficits, a decline in local revenue, and ultimately, questions about the sustainability of current budget models.

As most people know, local governments in China have historically relied on land sales as their primary source of revenue. As the property market has contracted, that revenue has collapsed in many jurisdictions. Local government debt — much of it held through financing vehicles rather than on-balance-sheet — is a known concern that the central government is actively working to manage but has not resolved. Local governments under budget pressure cannot expand public-sector employment as freely as they could a decade ago.

This is happening at a time when SOEs are also under pressure to be more profitable and are struggling to meet those targets. Even though SOEs, as we mentioned, may not have to respond to every economic downturn by laying people off, many people, including employees, are wondering about the overall trend. Will they still have the ability to be a buffer against unemployment in the next quarter-century in the same way they have over the previous 25 years? People start asking questions even when there aren’t any immediate plans for layoffs.

What I observe at the policy level — directly relevant to the 15th Five-Year Plan priorities from this year’s Two Sessions — is that Beijing is threading a difficult needle. It’s pushing AI integration and industrial modernization as the source of future productivity, while also emphasizing domestic consumption growth and income support for lower-income groups. Those two objectives may be in tension. If AI-driven productivity gains don’t translate into wage growth, the consumption boost won’t materialize. The government is aware of this. Whether the policy instruments available are sufficient to manage the transition is a genuinely open question, and I don’t think anyone who claims to know the answer with certainty has earned that confidence.

What I can say from what I observe on the ground is that the adjustment is real. It’s uneven across cities and sectors, and the social dynamics around it are more complex than either the “China’s state can absorb anything” or the “China is heading for a crisis” narrative captures.

Q12: Chinese companies going global has been a major trend in recent years. What are the challenges these companies face, especially in tech?

Chinese companies going global is not a new phenomenon. It has been happening for a couple of decades. However, the pace and scale of that expansion have accelerated significantly in recent years. And I want to say plainly that I have tremendous admiration for Chinese entrepreneurs, particularly those running private companies. Unlike their Western peers, they don’t just have to build the best products at the most competitive prices while surviving ferocious domestic competition. They also have to navigate a complex political environment, both domestically and internationally. The challenges they face are extraordinary on multiple fronts.

Internally, going global requires a fundamental transformation of company structure, processes, and mindset. On the communications side, Chinese companies are often unprepared for the level of international media scrutiny they encounter once they expand overseas. In China, there are ways to manage and shape your narrative, but internationally, you can’t fully control how you’re portrayed, and that lack of control can be a real shock for Chinese executives.

On the business side, the challenge is even more fundamental. Most Chinese tech companies, unlike the latest generation of AI hardware and robotics firms that are global-native from day one, started by serving Chinese customers and are now making a strategic pivot overseas. That transition requires rethinking market entry strategy, localization, customer understanding, and competitive positioning from scratch. And it’s not just one market: the companies I work with typically target the US, Europe, Southeast Asia, and the Middle East, simultaneously — each with an entirely different set of challenges. If a local customer feels the product doesn’t understand them, that’s a failure, regardless of how good the underlying technology is.

Externally, the geopolitical headwinds are serious and growing. Chinese companies face heightened SEC scrutiny, US-China tariffs, and sweeping regulations like the EU AI Act that reshape what’s permissible for foreign tech operators. Some e-commerce companies I know have had their logistics disrupted by conflicts affecting key trade routes. Even companies not directly impacted are reassessing their exposure.

There are also challenges specific to being Chinese. TikTok is the obvious example — a company that has had to fight for its existence in its largest market for years. Eva Dou’s book, House of Huawei, traces how a relatively small company grew into a global giant, despite some pretty tough odds. And Huawei’s story could be seen as a cautionary tale about how increased scrutiny and even suspicion are prices companies pay for success.

The companies I’ve seen navigate this most successfully are patient, invest in local relationships before they need them, are transparent about their ownership and governance structure, and pick initial markets strategically — often starting in Southeast Asia, the Middle East, or Latin America, where political headwinds are lower, before attempting more difficult Western markets. The companies that struggle most try to replicate the Chinese playbook of speed and scale in markets where the ground conditions don’t support it and are surprised when the approach doesn’t work.

None of this is going away. If anything, the complexity will increase as more Chinese companies become genuinely multinational. But I do have faith in Chinese entrepreneurs. They are resourceful, hardworking, and deeply determined. They’ve navigated extraordinary complexity to get to where they are, and I believe they will continue to find ways forward.

Q13: Please share any favorite books, publications, blogs, podcasts or other resources that readers could use to improve their understanding of China, Chinese tech, and AI.

If you could only subscribe to one newsletter to understand China, it would be Bill Bishop’s Sinocism on Substack. Bill curates a detailed daily briefing drawn primarily from Chinese media coverage, and that’s exactly what makes it so valuable. One of the fundamental problems with the international understanding of China is that most people read only Western media coverage of China, which is fine as far as it goes, but it means you’re missing an enormous amount of context. The perspective inside Chinese media and social media is often very different from what gets reported internationally. Sinocism bridges that gap, especially for those who don’t read Chinese.

For books, if you want to understand how Chinese tech companies have built themselves into global players, I’d strongly recommend a book that I’ve already mentioned: House of Huawei by Eva Dou. I think many readers assume the book is about military connections or surveillance, but it’s more about navigating relationships with the central and local governments, a relentless drive to succeed despite numerous obstacles, and just how many barriers Huawei faced as it rose to prominence. And none of these things are unique to Huawei; you can find some version of this story behind the rise of many Chinese companies that have gone big or gone global. There are legendary stories in Chinese tech circles about founders like Richard Liu of JD.com sleeping in the office and working punishing hours for years. Those are just the ones who made it. Countless others worked just as hard, and you never heard their names.

On the WEF specifically, Klaus Schwab’s own writing is worth reading. It’s analytically sharp, and it’s useful for understanding how the Forum conceptualizes its own mission.

For podcasts, I’m a big fan of The Diary of a CEO hosted by Steven Bartlett. It’s not exclusively about AI content, and all of the episodes are fantastic, but the AI episodes are genuinely excellent. Steven is rigorous about only bringing on the top experts in any field, so when he covers AI, you’re hearing from people at the actual forefront, from academia and from those building the technology. The depth of those conversations is unlike most things you’ll find. Set aside an hour and a half to two hours per episode, and you’ll come away with a real understanding of where the arguments in this field are actually coming from, and why the smartest people in the world hold the views they do.

Finally, for anyone serious about this space: learn to read Chinese-language sources directly, even imperfectly. Machine translation has gotten good enough that you can get a real signal from policy documents, official speeches, and domestic media that never makes it into English. The selection bias in what gets translated is significant, and what gets left out is often precisely what you most need to understand.

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