Trends in the development of digital economy in China

Introduction 2
1. THEORETICAL APPROACHES AND CURRENT RESEARCH ON DIGITAL ECONOMY 6
1.1. Defining the digital economy, e-commerce, digital health and education 6
1.2. Review of current studies 14
2. CURRENT TRENDS IN THE DEVELOPMENT OF THE DIGITAL ECONOMY IN THE PRC 22
2.1. China's digital economy development: stages, factors, features and challenges 22
2.2. Impact of the COVID-19 on the development of the health and education sectors 29
2.3. Applying AI technology in a pandemic: key technologies and features 36
2.4. The development of e-commerce in rural areas: features, success factors, impact of the
pandemic 47
3. THE DEVELOPMENT OF THE DIGITAL RENMINBI AND ITS PROSPECTS 59
3.1. Stages in the emergence of the digital renminbi and prospects for domestic use 59
3.2. Prospects for cross-border use of the digital yuan 65
3.3. The digital yuan: experience and opportunity for Russia 69
Conclusion 72
References 75
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The rapid technology advancement and general changes in the world economy are undoubtedly changing the global market. The global financial crisis of 2008 hastened a number of trends that have emerged as a result of the growing importance of the Internet, including consumer behavior shifts, globalization processes, and industry transformation. It has also raised risk and uncertainty. Speaking of the Internet, it is important to remember that it offers the fundamental framework for the growth of the digital economy. New markets are developing as a result of the Internet, allowing businesses and entrepreneurs worldwide to collaborate, participate in the development of goods and services, and create and use cutting-edge technologies. All of this was previously impossible, but now businesses and individuals from all over the world can engage in innovation, wealth creation, and social engagement in new ways. The essential link between economic growth and technological advancement is particularly evident nowadays.
Regarding developed nations, it can be said that technological advancement is partially fueled by the fact that investors are more actively funding innovative projects because traditional industries cannot provide them with high returns. We may observe that the demand for high technology has been shaped in developing nations like China by industrial development, the quick rise in population affluence, and the expansion of these populations as a whole. Therefore, businesses must focus on innovation and actively integrate into the new digital reality in every nation.
In developing nations that have participated in the manufacturing sector, the digitalization issue is particularly severe. For instance, China's economy has recently faced new difficulties in the form of slower economic development and higher salaries. As a result, labour-intensive production has shifted from China to other countries, leading to capital flight from the country. The PRC is working to develop high value-added items and to establish value chains domestically. The digitalization of the economy may serve as China's new engine for growth. The economy's digitalization is crucial in the context of the coronavirus pandemic because the COVID-19 epidemic, which forced many processes online, gave us a chance to observe the efficiency of using digital technologies.
Technology and digital solutions were among the most critical in the fight against the pandemic, and allowed many processes to be adapted. Many technologies developed during the pandemic, including artificial intelligence, digital payments and currencies, digital learning and health technologies, and finally digital economy components such as e-commerce made it easier for underdeveloped regions to survive the impact of lockdowns. This paper will focus specifically on these sectors of the digital economy.
Additionally, China's underdeveloped rural areas could benefit from the development of the digital economy. For the PRC, which has experienced labor migration to cities for decades, differences in economic, technological, and income levels are a societal challenge. Perhaps the advent of digitalization will open up new, desirable job opportunities and give people the chance to launch their own businesses. Through access to high-quality healthcare and education, digitalization can also qualitatively improve life in rural areas. This will then have a positive effect on the economic growth of the areas and the caliber of the human capital. In the state development plans for the upcoming few years, all these suggestions for raising rural incomes, enhancing and extending health care, and expanding education have been made.
China's experience is important to study because it represents, firstly, the experience of responding to a new challenge, as the country was the first to meet the coronavirus pandemic. In addition, it is in China that successful experiences of interaction between authorities, IT companies, local companies and users can be analysed. China is the first major country to actively implement many key technologies for the digital economy, such as central banks' digital currencies. China's experience can be applied to other countries, such as Russia, which also plans to develop digital solutions and digital currency.
The purpose of this paper is to identify key trends in China's digital economy and its impact on economic transformation.
In order to achieve this goal, a number of objectives were set:
• To reveal the general characteristics, features of the current development of digital economy, e-commerce, digital education and health projects;
• To consider the methods of government participation and support for digitalization of rural areas in China;
• Highlight the key factors of the positive impact of digitalization in rural areas of the PRC;
• Analyse the experience of applying artificial intelligence technologies in the fight against the coronavirus pandemic;
• Detect key milestones in the development of the digital renminbi in the PRC
• Identify the main prospects for cross-border application of the digital renminbi, as well as opportunities for Russia.
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