Critics and skeptical analysts warn that relying on high-tech manufacturing to rescue the Chinese economy is a fundamental miscalculation. They argue that while AI and advanced exports are impressive, they cannot replace the massive economic contribution of a healthy, consuming middle class. Because the property sector and household consumption account for such a large share of GDP, the current 'dual economy'—where high-tech thrives while the rest of the country struggles—is inherently unstable and insufficient to drive broad-based prosperity.
The core of the problem, according to this view, is a lack of consumer confidence driven by deep structural issues. When households face stagnant wages, high youth unemployment, and the loss of wealth from falling home prices, they naturally retrench. No amount of AI-driven productivity can fix a lack of domestic demand if people are too worried about their financial future to spend money. By prioritizing supply-side manufacturing over demand-side support, the government is effectively ignoring the root cause of the current slowdown.
Furthermore, there is a significant risk that this strategy will lead to overcapacity, where Chinese firms produce more goods than the global market can absorb, triggering trade tensions and protectionist responses from other nations. Critics argue that without a major shift toward social safety nets and policies that directly boost household income, the economy will remain trapped in a cycle of deflationary pressure and sluggish growth, regardless of how many high-tech factories are built.