Published by ChinaMNC · Lintong

China's New Push on 'New Quality Productive Forces': What Foreign Founders Should Know

A practical guide for foreign founders in China on the policy direction set out in the CPC Central Committee and State Council opinion on developing new quality productive forces — covering R&D incentives, emerging industries, data, green policy, finance and talent.

Why This Policy Matters for Foreign-Owned Companies

The CPC Central Committee and the State Council have issued an opinion on developing new quality productive forces — the policy framework behind China's push to raise total factor productivity through technological and industrial upgrading. For foreign founders registering or running a company in China, the document is a map of where incentives, regulatory attention and market opportunities are likely to concentrate. Below is a practical summary of what the source text says, without spin.

Innovation and R&D: Where Support Is Directed

Basic and breakthrough research

The opinion calls for major science projects organised around strategic, landmark and leading-edge products, with support for both goal-oriented and free-exploration basic research. It proposes systematic construction of major science infrastructure with shared access, a programme for breakthroughs in basic and interdisciplinary disciplines, and work on original theory, key common technologies, frontier technologies and disruptive innovation.

Key core technologies

China's new system for mobilising national resources is to be used in priority fields, including action plans for high-quality development of manufacturing supply chains and industrial innovation projects, with whole-chain and whole-ecosystem support.

Institutional science capacity

National laboratories are to take the lead in major projects and platforms and pilot institutional reforms. The roles of national research institutes, high-level research universities and leading tech enterprises are to be better positioned. Universities and research institutes are to move toward pay systems that reward knowledge value and innovation, and research-type public institutions may adopt more flexible management.

Enterprises as the Main Body of Innovation

Several measures speak directly to company operations:

• A corporate R&D reserve fund system is to be established, reinforcing firms' role in funding research.
• The super-deduction ratio for enterprise R&D expenses is to be raised for tech SMEs.
• Qualifying corporate R&D projects may be elevated to national projects; capable private enterprises are encouraged to lead major national technology programmes.
• User-based evaluation of results is to be built, strengthening firms' role in commercialisation.
• SOEs are to have institutional arrangements for original innovation; specialised, refined, distinctive and innovative SMEs are supported.

Commercialisation

The text proposes demonstration programmes for large-scale application of new technologies, products and scenarios; concept-validation and pilot-testing platforms; evaluation of technology projects across their whole cycle, with R&D and commercialisation tasks designed together and application results assessed at acceptance; and licensing of university and institute results to smaller firms on a use-first, pay-later basis. Large enterprises are encouraged to open supply chains to smaller firms, and AI is to be used to reshape research methods.

Industry Priorities

Traditional industries

Upgrading via national standards, digital and green technologies, industrial base rebuilding, major equipment and technical transformation programmes, and large-scale equipment renewal. Mining, metallurgy, chemicals, light industry, textiles, machinery, shipbuilding and construction are named. Tax incentives for technical transformation investment are to be implemented. Agriculture actions and a service-sector upgrading action are also listed.

Emerging and future industries

Priority is given to next-generation IT, new energy, new materials, intelligent connected new-energy vehicles, robotics, biomedicine, high-end equipment and aerospace, with clusters built according to local conditions and cross-regional collaboration led by eastern regions. The text warns against involution-style competition. Low-altitude economy and commercial space are to develop in an orderly way subject to safety. Future industries named include quantum technology, bio-manufacturing, hydrogen and fusion energy, brain-computer interfaces, embodied intelligence and 6G, backed by investment-growth and risk-sharing mechanisms.

Digital and AI

Data property rights, trading, benefit distribution and protection rules are to be improved, with pilot programmes, national data infrastructure, an integrated national computing network and a national blockchain network. The “AI+” initiative is to be fully implemented across traditional industries, smart terminals, humanoid robots and sector-specific application test bases, alongside monitoring, risk-warning and emergency-response systems for AI safety.

Green Transition

The opinion promotes green manufacturing, services and energy industries, green upgrading of key sectors, zero-carbon factories and parks, and circular use of waste. Policy tools include fiscal, financial, investment, price, technology and environmental measures; a dual control system for total and intensity of carbon emissions; carbon accounting, standards, labelling and footprint systems; expansion of the national emissions trading market and the voluntary reduction market; a unified green certificate market; green financial products; green government procurement; and green-oriented agricultural subsidies. An energy revolution is to be advanced toward carbon peaking and neutrality goals, with international cooperation.

Regulation, Finance and Talent

Reforms include demand-oriented project selection, application-oriented evaluation, and expanded authority over job-related scientific results. A unified national data market is to be built. Market supervision is to be strengthened in anti-monopoly and anti-unfair competition, with governance for AI and biology, cross-departmental joint supervision, less on-site inspection, data-based supervision, stronger IP protection and punitive damages, and research on tax rules suited to new business forms.

On finance, the text encourages angel, venture and private equity investment, government guidance funds, long-term capital for early-stage and hard-tech ventures, patient capital, bank loan products suited to new productive forces, sci-tech bonds, listings for quality tech firms, and insurance and technology leasing products covering the innovation chain.

On opening, pilot free trade zones are to concentrate advanced production factors; science parks, Belt and Road joint laboratories and international technology application centres are to be built; foreign venture capital institutions and international standards bodies are encouraged to operate in China; and efficient, secure cross-border data flows are to be established.

On talent, higher education is to expand with new research universities and adjusted disciplines; vocational education is to adopt integrated work-study training; and firms and universities may jointly design talent programmes, with master craftsmen and highly skilled staff allowed to teach part-time.

Practical Takeaways for Foreign Founders

• Align R&D with listed priority fields — AI, robotics, new energy, biomedicine, green tech — to sit inside supported clusters.
• Track R&D expense deductions and transformation incentives as they are implemented; confirm eligibility with local authorities.
• Consider data and cross-border compliance early, given the data market, security and AI governance measures.
• Explore licensing and joint programmes with universities and institutes, including use-first-pay-later arrangements.
• Watch green compliance — carbon accounting, labelling and footprint rules — if you export or manufacture.

This summary is based on information published by the relevant Chinese government website and is general information, not legal or tax advice.

Ready to set up or expand in China? Foreign founders can contact ChinaMNC on WhatsApp / WeChat at +86 153 1898 8535 for help registering and operating a company in China.