Key Points
- China’s new directive, issued by seven government departments including the People’s Bank of China (Renmin Yinhang 人民银行), outlines 8 key financial shifts to support “new industrialization.”
- The policy prioritizes “long-term cash” for core tech breakthroughs (e.g., Integrated Circuits, Industrial Mother Machines, Foundational Software) and “patient capital” for deep tech R&D, moving away from short-term gains.
- It aims to upgrade traditional industries through financing for high-end, intelligent, and green transformations, and fast-track capital for emerging and future industries like future manufacturing and energy.
- New credit models are introduced for SMEs, shifting from “guarantee dependence” to “data credit” and “asset credit,” and exploring “de-nucleation” models to unlock liquidity across supply chains.
- The directive emphasizes strategic green finance, supporting carbon-intensive sectors with upgrade plans, and boosting digital infrastructure like 5G and industrial internet buildouts, while implementing risk controls to prevent “involuted competition.”
A sweeping new directive on financial support for new industrialization is set to reshape China’s tech and manufacturing landscape, and you need to know what’s in it.
On August 5, 2025, a powerhouse coalition of seven Chinese government departments dropped a major policy document.
Led by the People’s Bank of China (Renmin Yinhang 人民银行), the Ministry of Industry and Information Technology (Gongye He Xinxi Hua Bu 工业和信息化部), and the National Development and Reform Commission (Guojia Fazhan Gaige Weiyuanhui 国家发展改革委), this isn’t just another government memo.
It’s a strategic roadmap for directing capital into the technologies and industries Beijing deems critical for the future.
So, where is the money actually going? Here are the 8 key takeaways, deconstructed.
1. Pouring “Long-Term Cash” into Core Tech Breakthroughs
The government is mandating that banks open up their wallets for long-term financing in critical tech sectors.
This isn’t about short-term gains; it’s a strategic push for self-sufficiency.
Key Areas Getting Funded:
- Integrated Circuits: The lifeblood of all modern electronics.
- Industrial Mother Machines: High-end machine tools that build other machines—foundational for advanced manufacturing.
- Foundational Software: The operating systems and core programs that underpin entire digital ecosystems.
Companies that hit milestones in these areas will get a fast pass.
Expect to see them get “green channels” for listings (IPOs), issuing bonds, and M&A activity.
Support is also being beefed up for “three initial” products—think first-of-its-kind equipment and first-batch advanced materials.
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2. Cultivating “Patient Capital” for Deep Tech & R&D
The directive aims to shift investment culture away from quick flips and towards long-haul R&D.
They’re pushing initiatives like “One Month, One Chain” investment roadshows to connect money with specific industrial chains.
Another program, “Thousands of Sails, Hundred Boats,” is designed to cultivate and prep a pipeline of hard-tech companies for public listings.
The goal is to guide social capital towards investments that are:
- Early-stage
- Small-scale
- Long-term
- Hard-tech focused
Venture capital is also getting new tools, with the ability to invest in incubated companies via direct investment or service-for-equity swaps.
3. Upgrading Old-School Industries with New-School Financing
This isn’t just about building the new; it’s also about upgrading the old.
Banks are being told to increase credit for the high-end, intelligent, and green transformation of China’s massive manufacturing sector.
Companies can use financial leasing to upgrade to smart, eco-friendly equipment, and those related debts can then be packaged and securitized.
This provides a clear financial pathway for traditional industries to modernize without massive upfront capital expenditure.
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4. Fast-Tracking “Timely Capital” for Emerging & Future Industries
For the next wave of disruptive tech, the government is ensuring capital is ready and waiting.
Emerging industries like next-gen IT, new energy, and biomedicine are being pushed to leverage multi-tiered capital markets for financing.
More importantly, government investment funds and insurance capital are being positioned as the primary long-term backers for “future industries.”
Think speculative but high-potential fields like:
- Future Manufacturing (e.g., advanced robotics, 3D printing at scale)
- Future Energy (e.g., next-gen batteries, fusion)
New mechanisms like the “innovation积分制” (innovation point system) and “intellectual property pledge loans” will also make it easier for tech companies to unlock capital based on their IP and R&D progress.
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5. Cutting the Cord: New Credit Models for Small & Medium Businesses
SMEs are getting a major lifeline by breaking the “guarantee dependence.”
Historically, small businesses needed a large “core enterprise” to vouch for them to get a loan.
Now, financial institutions are being encouraged to offer financing based on “data credit” and “asset credit.”
This means loans can be secured against tangible business activities, like:
- Accounts receivable
- Purchase orders
- Warehouse receipts
The government is also exploring “de-nucleation” models, where businesses in a supply chain can get loans without relying on the credit of the central, core company.
This is a game-changer for unlocking liquidity across entire supply chains.
6. Doubling Down on Green Finance That Actually Works
The policy takes a pragmatic approach to the green transition.
Instead of a “one-size-fits-all” shutdown of carbon-intensive sectors, banks are encouraged to support projects in these industries that have credible green and low-carbon tech upgrade plans.
The mantra is “prioritizing establishment over disruption.”
Green credit and green bonds will be channeled to environmental protection, energy conservation, and low-carbon sectors to help build more “green factories.”
7. “Intelligent” Services: Digitizing the Financial Backbone
Digital infrastructure is being treated as a core utility that needs funding.
Projects like 5G network buildouts and the industrial internet will get access to medium-to-long-term loans, financial leasing, and asset securitization.
Banks are also tasked with building digital industry platforms to offer one-stop shops for financing and settlement.
And yes, Big Data (Dachengshuju 大数据) and AI are being deployed to streamline the loan process and improve how financial services are delivered to SMEs.
8. Playing it Safe: Keeping a Lid on Financial Risks
With all this capital being unlocked, Beijing is building in guardrails.
Financial institutions must monitor how funds are used to prevent misappropriation.
At the same time, they are being warned to avoid “involuted” competition—a term for cut-throat, zero-sum races to the bottom.
Joint industrial and financial risk assessments will be set up to share high-risk information in a timely manner.
This directive is a clear roadmap showing where China is placing its bets for the next decade. For investors, founders, and tech watchers, understanding these shifts in financial support for new industrialization is no longer optional—it’s essential.
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