May 03, 2026
The Political Limits of China’s AI Diffusion Ambitions
This article was originally published in Lawfare.
When a Beijing-based company replaced an employee, identified as Liu, with an automated system, it likely expected China’s courts to side with its decision. After all, the government’s AI Plus initiative targets 70 percent AI adoption across key sectors by 2027 and 90 percent by 2030. Instead, the court sided with Liu.
Beijing’s drive to diffuse AI will increasingly run up against its commitment to employment stability and fear of collective action.
In a 2025 ruling, a Chinese court ruled that replacing a worker with AI is not valid grounds for dismissal and that firms must first attempt contract renegotiation, retraining, or internal reassignment. Beijing’s labor bureau subsequently published the decision as a “model case,” the Chinese judicial system’s rough equivalent to stare decisis in the United States, signaling how similar disputes should be handled. The case is emblematic of a shift in how Chinese policymakers are preparing for the possibility of AI-driven labor displacement and may foreshadow slowed diffusion of AI in China in favor of worker protections and economic stability.
Read the full article in Lawfare.
More from CNAS
-
Commentary
Technology & National Security
The Strange Rise and Fall of Russia’s Crowd Sourced Defense IndustryThe overall impact of the People’s VPK on the war effort is likely larger, encompassing a host of innovation efforts....
By Samuel Bendett & Michael Kofman
-
Podcast
Technology & National Security
Quantum 201: U.S. vs China Quantum Industrial BaseConstanza Vidal Bustamante, fellow at the Center for a New American Security, joins Chris Miller and Zachary Yerushalmi to break down her new report with John Burke, Quantum's...
By Constanza M. Vidal Bustamante
-
Commentary
Technology & National Security
CNAS Insights | MATCHing Policy to StrategyAdvanced semiconductors underpin the growing capabilities of artificial intelligence (AI). The computing power they provide drives military capability, economic productivity, ...
By Janet Egan & Michelle Nie
-
Commentary
Technology & National Security
CNAS Insights | American AI Exports Need a Sovereignty SolutionEarlier this month, the Department of Commerce opened applications for the American AI Exports Program, an ambitious effort to deploy American AI technology, tools, and infras...
By Ruby Scanlon & Vivek Chilukuri
