Key Points
- China plans to launch a government-backed fund of 1 trillion yuan (about $138 billion) for tech startups.
- The public-private partnership fund will focus on “hard technology,” such as semiconductors and renewable energy.
- The fund will also support emerging sectors that target early-stage companies, such as AI, quantum technology, and hydrogen energy storage.
- This strategic investment aligns with efforts to sustain economic growth of around 5% amid trade tariff challenges.
China is set to launch a government-backed fund that will mobilize 1 trillion yuan (approximately $138 billion) from social capital to support technology startups, according to Zheng Shanjie, head of China’s state planning department. At a news conference on Thursday, Zheng explained that the new initiative, the National Venture Capital Guidance Fund, is designed as a public-private partnership to advance “hard technology” sectors such as semiconductors and renewable energy. He emphasized that the fund will follow market-based approaches, maintain long-term investment cycles, and exhibit a higher tolerance for risk to nurture breakthrough innovations.
This move is part of Beijing’s broader effort to bolster its technology industry and reduce dependence on Western technology. Recently, Premier Li Qiang informed lawmakers of plans to sustain economic growth at around 5% despite the pressures from trade tariffs, highlighting the need to strengthen domestic capabilities.
In line with these efforts, China announced on Wednesday its intention to boost support for applying artificial intelligence models and developing venture capital investments. These measures are intended to spur technological breakthroughs and increase the country’s self-reliance in advanced sectors.
The fund’s focus will not be limited to traditional “hard tech” like semiconductors and renewable energy. According to state media CCTV, the new initiative will also target emerging fields such as artificial intelligence, quantum technology, and hydrogen energy storage. By investing in seed-stage and start-up companies, the government aims to create an environment that fosters innovation and accelerates the commercialization of next-generation technologies.
Industry analysts consider this substantial capital injection critical in China’s long-term strategy to dominate global technology markets. The initiative is expected to stimulate significant growth in the tech sector, boost domestic innovation, and help counterbalance the impact of external pressures and tariffs.
