China's 'potato capital' cultivates new crop of data centres as AI boom takes root

Ulanqab, a region previously noted for its agricultural output and dubbed China's "potato capital," is actively cultivating a new industry centered on AI data centers. This transition is marked by the signing of 109 computing-center projects, with AI-focused computing constituting over 90 percent of the city's total capacity as of August, according to state news agency Xinhua. These facilities are part of China's broader strategy to establish national computing hubs.

The industrial shift has directly impacted individual residents. Farmer Zhang Zhiyong, for example, received more than 200,000 yuan (US$30,000) in compensation for approximately 0.7 hectares of his farmland. This compensation has allowed him to significantly reduce his physical workload and is concurrent with an expansion of his home, illustrating an immediate financial benefit for some local landowners.

Beyond land sales, the extensive construction activity for data centers has stimulated local commerce. Food hawker Gao Lina, who moved her business to a data-center cluster, reports brisk sales of around 100 portions daily to construction workers. Her experience suggests that new economic activity, such as increased demand for local services, is being generated by the development projects in the area.