Published by ChinaMNC · Min

China’s New Push for ‘New Quality Productive Forces’: What Foreign Founders Need to Know

China has released a major policy document on developing ‘new quality productive forces.’ Here’s what the official guidance says and how foreign founders can align their China operations with the priorities outlined.

China’s New Quality Productive Forces: A Policy Primer for Foreign Founders

On October 9, the Central Committee of the Communist Party of China and the State Council publicly released the Opinions on Developing New Quality Productive Forces. The document sets out overall requirements and key tasks for developing what is termed “new quality productive forces” and makes arrangements for implementation. For foreign founders registering or operating a company in China, this policy direction signals where official attention and support are heading.

What Are ‘New Quality Productive Forces’?

The concept was first introduced by Xi Jinping in September 2023 during an inspection tour in Heilongjiang, where he called for integrating scientific and technological innovation resources, leading the development of strategic emerging industries and future industries, and accelerating the formation of new quality productive forces. In December 2023, the Central Economic Work Conference further proposed using scientific and technological innovation to drive industrial innovation, especially using disruptive and frontier technologies to create new industries, new models, and new momentum.

According to official explanations, new quality productive forces are an advanced form of productive forces in which innovation plays a leading role, that break away from traditional economic growth models and productivity development paths, and that feature high technology, high efficiency, and high quality, conforming to the new development philosophy. They are marked by a substantial increase in total factor productivity; their characteristic is innovation, their key is quality, and their essence is advanced productive forces.

Key Priorities Outlined in the Opinions

The Opinions place major emphasis on the following areas, which are also presented as key tasks:

• Vigorously advancing scientific and technological innovation — including strengthening original and disruptive innovation and accelerating breakthroughs in core technologies.
• Promoting deep integration of scientific and technological innovation with industrial innovation — encouraging new industries, new models, and new momentum.
• Advancing innovation in development models — shifting toward more sustainable and efficient growth paths.
• Solidly advancing institutional and mechanism innovation — improving the institutional environment to support new quality productive forces.
• Deepening innovation in talent work mechanisms — attracting and cultivating talent.

The document also highlights guiding principles: adhering to innovation leadership, making reform the key, adapting to local conditions, and establishing the new before abolishing the old.

What This Means for Foreign Founders

For foreign founders setting up or running a company in China, the policy direction suggests several practical considerations:

1. Align with encouraged sectors

The Opinions emphasize strategic emerging industries and future industries. Official examples mentioned in the source include commercial aerospace, quantum information, artificial intelligence, humanoid robotics, new energy vehicles, and the low-altitude economy. Founders in these or related technology-intensive fields may find their activities more closely aligned with official priorities.

2. Innovation is central

The document stresses that innovation plays a leading role in new quality productive forces. Foreign companies with R&D capabilities or proprietary technology may find it useful to highlight their innovation activities when engaging with local authorities or applying for available support measures.

3. Adapt to local conditions

The guidance calls for adapting to local conditions and avoiding blind clustering. Foreign founders should assess local resource endowments, industrial foundations, and research conditions when choosing a location, rather than following trends without regard to local fit.

4. Traditional industries are not excluded

Official remarks emphasize that developing new quality productive forces does not mean neglecting or abandoning traditional industries. Founders in traditional sectors can still upgrade through technology and innovation.

5. Talent mechanisms are a focus

Deepening talent work mechanism innovation is listed as a key task. Foreign companies may benefit from staying informed about local talent policies and mechanisms as they build teams in China.

Regional Examples

The source provides examples of regional progress: Beijing is accelerating its development as an international center for science and technology innovation, with original achievements in artificial intelligence and quantum information; Guangdong has seen the growth of trillion-yuan industrial clusters, with 20 clusters accounting for over 30% of the province’s GDP; Anhui has developed integrated capabilities enabling the production of a complete new energy vehicle within the province, and Hefei’s new energy vehicle output ranked first among Chinese cities last year, with over 3,750 new energy vehicles rolling off production lines daily on average.

These examples illustrate how local conditions shape development paths. Foreign founders can look to such regional strengths when deciding where to base specific operations.

Conclusion

The Opinions on Developing New Quality Productive Forces set out a policy framework that prioritizes technological innovation, industrial upgrading, and institutional reform. While the document is directed at domestic implementation, its priorities are relevant to foreign founders who are registering or operating a company in China. Keeping abreast of these priorities can help inform business planning and engagement with local authorities.

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