China SOEs Invest $470B in 11 Months, Boosting Emerging Industries

From January to November, China’s state-owned enterprises under central management increased their fixed-asset investments, excluding real estate, by 0.7% to CNY3.3 trillion (about USD470 billion), with notable gains in emerging industry sectors.

The combined value-added output of these enterprises, managed directly by the State-owned Assets Supervision and Administration Commission, also grew by 1.4% to CNY9.5 trillion during this period, as reported at a recent meeting of senior leaders from central SOEs.

Research and development expenditures remained high at CNY890 billion (around USD127 billion), representing 2.6% of their total economic output.

Investment in emerging industries accelerated, especially in the “AI+” initiative, which seeks to incorporate artificial intelligence into traditional industries and public services to enhance productivity and promote industrial upgrading. This initiative has expanded into 16 key sectors, including energy, manufacturing, and communications, and now features nearly 1,000 application scenarios.

To bolster support for these emerging sectors, China Reform Holdings, a state asset manager affiliated with SASAC, collaborated with more than ten central SOEs in October to establish a dedicated fund for the strategic development of emerging industries, initially providing CNY51 billion (about USD7.3 billion).

Over the past five years, these enterprises have collectively invested over CNY5 trillion (around USD713 billion) in research and development. During this period, investment in emerging sectors has grown at an average annual rate of over 20%, and the number of scientific and technological personnel increased by nearly 50%.

Looking into next year, officials emphasized that central SOEs should balance efforts between transforming traditional industries and advancing emerging sectors. Major focus areas include new energy, advanced materials, aerospace, low-altitude economy, quantum technology, and sixth-generation communications technologies.

The expansion of the “AI+” initiative will continue alongside a new phase of digital transformation for these enterprises.

The authority also urged SOEs to accelerate technological upgrades, renew major equipment, and intensify efforts to save energy and reduce carbon emissions across key industries to hasten industrial transformation.