Fresh measures set to help create new growth drivers

China is putting a priority on fostering new quality productive forces and boosting technological innovation in its economic agenda for the year, as policymakers announced on Thursday the rollout of a raft of supportive measures aimed at creating new growth drivers for the world's second-largest economy.

"In the near future, we will establish a national venture capital guidance fund, with the goal of enhancing, strengthening and expanding innovative enterprises," said Zheng Shanjie, head of the National Development and Reform Commission. He made the remark at a news conference in Beijing during the ongoing third session of the 14th National People's Congress, the country's top legislature.

The fund is expected to attract nearly 1 trillion yuan ($138 billion) in capital from local governments and the private sector, Zheng said, adding that the goal is to focus on hard technology, maintain a long-term perspective, and enhance risk tolerance while channeling investment into tech companies through market-oriented approaches.

Experts said China's more pro-innovation stance will significantly boost confidence among investors and entrepreneurs, stimulate market vitality and guide more investment to future industries and next-generation technologies.

According to the Government Work Report delivered on Wednesday at the opening meeting of the third session of the 14th NPC, China will strive to develop new quality productive forces in light of local conditions and accelerate the development of a modernized industrial system. This will require the fostering of emerging industries and industries of the future, such as biomanufacturing, quantum technology, embodied artificial intelligence and 6G technology.

"Developing new quality productive forces will be key to boosting China's long-term economic growth potential, with artificial intelligence — in which the United States and China are seeking to gain a competitive edge — set for intensified development," said Li Chao, chief economist at Zheshang Securities. "Future industries could be a particular focus, and we anticipate new industrial plans to outline their growth trajectories."

Li said China will ramp up efforts to strengthen research in critical and revolutionary technologies and accelerate major tech projects.

"In this push, private enterprises — recognized as key drivers of innovation with high efficiency — are expected to play a greater role, particularly in application-driven breakthroughs, complementing the nation's investments in fundamental research," he added.

At the news conference on Thursday, Pan Gongsheng, governor of the People's Bank of China, the country's central bank, said China will launch a science and technology board in the bond market this year, as the country increases its commitment to providing financial support for technological innovation.

Pan said the initiative aims to facilitate financial institutions, technology enterprises and private equity investment funds in issuing specialized bonds that support scientific and technological innovation.

Ming Ming, chief economist at CITIC Securities, said: "The launch of a science and technology board in the bond market is not just an innovation in financing tools, but a key breakthrough in the system of financial support for technological innovation."

In addition, the central bank will optimize its lending program for technological innovation and technical transformation, increasing the program's size from 500 billion yuan to between 800 billion and 1 trillion yuan.