China's state enterprise to set up fund for emerging industries

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China's state enterprise to set up fund for emerging industries

The central state-owned enterprise China Reform Holdings Corp Ltd, specializing in the promotion of SOE reform, will establish a fund to support the development of emerging industries with a target size of more than 100 billion yuan.

The initiative has gathered support from more than 20 central SOEs, local governments and various social capital organizations who showed investment intent. It is set to be fully established and operational within this year, said Mo Dewang, China Reform's general manager.

The move follows China's focus on promoting cutting-edge industries for new growth engines and is part of its broader SOE reform efforts, experts said.

Strategic emerging industries, or emerging industries, are areas that are at their early stages of development and show significant potential for growth and innovation. In these industries, technology and business models are frequently utilized, such as artificial intelligence, biotechnology and new materials.

The SOE regulatory body, the State-owned assets Supervision and Administration Commission of the State Council, said last week that it has introduced action plans and implementation plans for nine strategic emerging industries and six future industries. The process of drafting tailored guidance policies for each strategic emerging sector and establishing specialized funds is ongoing, he said.

Central SOEs have achieved an average annual investment growth rate of over 20 percent in strategic emerging industries over the past three years, according to a recent report from SASAC's research center.

Central SOEs' investments in strategic emerging industries surged by 40 percent year-on-year, accounting for more than a quarter of their total investments.

SASAC is currently investing in initiatives to accelerate the development of emerging industries, with a focus on 15 key sectors, such as next-generation mobile communication, artificial intelligence, biotechnology and new materials. By 2023, the goal is to increase the percentage of strategic emerging industries among all business sectors of central SOEs by more than 2 percentage points.