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China Unveils Strategy to Encourage Digital Growth

Creating a digital China is critical to the advancement of Chinese modernisation in the digital era; thus, the Communist Party of China Central Committee and the State Council have revealed a plan for the overall layout of the country’s digital development. This is expected to provide significant support for the development of new competitive advantages in the country.

The plan cited that significant progress in the development of a digital China will be made by 2025, with effective interconnection in digital infrastructure, a significantly better digital economy, and huge advances in digital technology innovation. China will be at the worldwide vanguard of digital development by 2035, with better coordinated and sufficient digital advances in the economic, political, cultural, social, and ecological spheres.

The strategy includes support for the comprehensive integration of digital technology and the real economy, as well as the application of digital technology in the areas of agriculture, industry, finance, education, medical services, transportation, and energy.

The plan calls for a digital country with effective digital government services, a thriving cyberspace culture, digital public services that are easy for many people to access, and digital technology-based environmental governance.

Also, a system for independent digital technology innovation would be developed, and enterprises will be encouraged to take the lead in technical innovation. It also asks for stronger intellectual property protection.

Furthermore, many provinces and cities in China have promised to work harder to increase the output of the digital economy. They hope that this will help the economy as a whole recover from the bad effects of COVID-19.

In their most recent plans for economic growth, all 31 provincial-level regions on the Chinese mainland have emphasised the goal of building up the digital economy; and 21 of them have made it a goal to grow the share of their GDP that comes from the digital economy in the years to come.

Reports cited that in the next four years, Shanghai wants its digital economy-related core industries to contribute 18% of the city’s GDP, up from 15% last year. By the year 2027, Jiangxi province has established a goal to increase the corresponding percentage from the current 35% to 45%.

In the same year, the output of Zhejiang province’s digital economy-related core industries is expected to reach 1.6 trillion yuan ($235 billion), while Hunan province’s digital economy market as a whole is expected to reach more than 3 trillion yuan.

In addition, a new work plan from the Henan Development and Reform Commission says that the province of Henan in central China will spend 50 billion yuan ($7.39 billion) on expanding its digital infrastructure. The province will also help its manufacturing industry become more digital. This would require building 150 “smart” factories and 10 “industrial Internet platforms” for each province.

China’s 14th Five-Year Plan (2021-2025) cited that core industries of the country’s digital economy will make up 10 per cent of the country’s GDP by 2025, up from 7.8% in 2020. The efforts of local governments to speed up the development of the digital economy are in line with this goal.

A white paper from the China Academy of Information and Communications Technology, a government think tank, showed that China’s digital economy had a market size of US$ 7.1 trillion last year, making it the second largest in the world.


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