E74: China’s AI-Driven New Economy
KEY TAKEAWAYS
- China's AI leadership is accelerating with generative AI adoption reaching 602 million users by December 2025 a 142% year-over-year increase fueled by national strategies and substantial investment
- AI-driven economic growth in China is macro-relevant with AI capital expenditure projected to exceed $3 trillion by 2030 positioning IT services to outpace the property sector's GDP contribution
- Strategic AI development in China emphasizes open-source models for ecosystem growth and innovation overcoming hardware constraints via software efficiency and prioritizing AI governance for sustainable investment
Erica Poon Werkun, Citi's Head of Research for JANA and Asia South, sits down with Chief China Economist Xiangrong Yu and Head of Pan-Asia Internet Research Alicia Yap to discuss AI development in China and the country's AI-driven new economy, with conversation topics ranging from how AI can be a catalyst for new economic growth to worries about workforce displacement.
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Erica Poon Werkun, Head of Research for JANA & Asia South
Erica joined Citi during June 2025 as JANA and Asia South Deputy Head of Research and became the Interim Head of Research for JANA & Asia South in September 2025. She was Managing Director and Head of Asia Pacific Research at Credit Suisse from 2019 to 2024 and previously worked at UBS for 15 years, as Head of Research in China, and before that as Head of Asian Consumer & Internet Research. Before joining UBS, she was at Goldman Sachs covering the Consumer and Technology sectors in Hong Kong and Taiwan. Erica also worked in technology investment banking for CSFB in Palo Alto and Hong Kong, and Cowen in New York and San Francisco. Erica holds a BS in Economics from the Wharton School, University of Pennsylvania, is a board member of the Wharton Executive Board for Asia and is a recipient of the Individual Achievement Award for Women in Finance Asia.
Xiangrong Yu, Chief China Economist
Xiangrong Yu is a Managing Director and Citigroup’s Chief China Economist, based in Hong Kong. Prior to joining Citi in 2017, he was a China economist at China International Capital Corporation (CICC) for three years, advising institutional investors. Xiangrong’s earlier roles include economist positions at Hong Kong Monetary Authority and International Monetary Fund.
Alicia Yap, Head of Pan-Asia Internet Research
Alicia Yap is a Managing Director and Head of Pan-Asia Internet Research. She joined Citi Research in 2016 from Barclays, where she was a Managing Director and Head of Asia-ex Japan Internet Research. Before joining Barclays in 2011, Alicia was at Citi, heading its China Internet Research Team. She has also worked at Bear Stearns in Hong Kong (2006-2007) and at America’s Growth Capital in the US (2004-2006).
