Instead of factories and people, China’s economic growth may increasingly be powered by code and digital workers that do not tire
3-MIN READ3-MINTeng BingshengPublished: 5:30am, 11 Apr 2026As China enters its 15th five-year plan, policymakers face a structural constraint that cannot be eased with another round of infrastructure spending or property stimulus. The demographic dividend that powered four decades of expansion is fading. Industrial competition has intensified. The central economic question is no longer how fast China can grow, but how productively.Artificial intelligence, specifically the rise of AI agents, may offer part of the answer. Deployed at scale, these systems could reshape factory operations, corporate innovation and urban governance. The shift would move China from a population dividend to what might be called an intelligence dividend.AI has moved well beyond chatbots. AI agents can perceive environments, reason through problems, call on external tools and execute tasks autonomously. Powered by large language models, they do not follow pre-written scripts but adapt and learn from data, refining decisions based on feedback. They can conduct research, write and debug code, analyse supply chains, design products or manage workflows – often at minimal cost.
AI agents potentially affect all three variables: they raise capital efficiency by optimising investment strategy, enhance labour productivity by augmenting or substituting knowledge-based tasks, and improve total factor productivity by reallocating resources more intelligently across complex systems.
