The lack of high-quality data and shortage of hi-tech talent are preventing wider adoption of artificial intelligence (AI) in China, which has become the world’s second largest market for the technology amid a tech and trade war with the US.

China, which has laid out plans to become the global AI leader by 2030, is projected to have an AI market worth US$11.9bil by 2023, up from an estimated US$4.5bil this year, despite those issues, according to the 2019 China AI Development white paper that was jointly released on Friday by technology research firm International Data Corp (IDC) and Chinese tech media outlet Qbitai.com.

More than 60% of 143 domestic AI industry insiders surveyed for the paper said implementation of AI systems are “very difficult” under the current circumstances. Other challenges cited by the paper include unclear application scenarios, high investment, and security and ethical issues.

The study found that many organisations do not have a dedicated team to do data labelling and cleaning, which are operations vital to build up quality data. It also found that most AI applications are possible only after huge amounts of data are analysed to extract patterns needed for efficient machine-learning systems.

Those findings pose a challenge to the conventional thinking that China has a strong advantage in AI because of the huge amount of data generated by its 840 million Internet users, the world’s biggest online population, as of June this year. The paper suggests that quality of data, more than quantity, would help drive greater adoption of the technology in the world’s second largest economy. The paper’s release comes as the US and China jostle for dominance in advanced technologies, from 5G to quantum computing and AI. The sharp rise in China’s AI patent applications and funding over the past few years has prompted the US government to take action as their trade dispute intensified.

In October, Washington blacklisted eight major Chinese AI companies over alleged human rights violations against Uygur Muslims and other predominantly Muslim ethnic minorities in Xinjiang. That followed US president Donald Trump’s February executive order, issued to reinforce America’s global AI leadership. It directed government agencies to prioritise AI in their research and development spending.

Still, China’s AI efforts have continued to advance. The country accounted for a 12% share of the US$37.5bil global AI market this year, according to the IDC and Qbitai.com paper. The US, however, dominated the market with a 57% share.

More organisations in China are also expected to invest further on AI in the next couple of years, according to the paper. With tighter scrutiny of Chinese nationals working in the US technology industry, more of this American-educated tech talent is expected to move back to China.

 - SCMP