NDRC Calls for Tackling “Involution” Competition and Cultivating New Growth Drivers; to Deepen and Expand “AI+” Initiative

NDRC tackles “involution” competition and expands “AI+”

NDRC tackles “involution” competition and expands “AI+”

Quick snapshot

What happened:

The National Development and Reform Commission (Guojia Fazhan he Gaige Weiyuanhui 国家发展和改革委员会) set the 2026 reform agenda at the national development and reform work conference in Beijing on December 12–13, 2025.

Top priorities named:

1. Fixing excessive, “involution-style” (neijuan 内卷式) competition.

2. Strengthening capacity governance in key industries.

3. Accelerating cultivation of emerging and future industries and expanding the “AI+” (Rengong Zhineng+ 人工智能+) initiative.

Overview

The commission announced plans to deepen and expand the “AI+” initiative, address shortcomings in the technology services sector, and improve the low-altitude economy ecosystem (Dikong Jingji 低空经济).

It also emphasized promoting high-quality development of the digital economy (Shuzi Jingji 数字经济) rather than pursuing short-term scale for its own sake.

Key points from the meeting

• Comprehensively rectify “involution-style” competition (neijuan shi 内卷式) that drains resources and obstructs healthy industrial development.

• Improve capacity governance for key industries and enhance oversight of major infrastructure projects to better balance supply and demand.

• Vigorously cultivate and scale up emerging industries and future-focused sectors, and develop several new pillar industries to support long-term growth.

• Deepen and expand the “AI+” initiative (Rengong Zhineng+ 人工智能+), integrating artificial intelligence across industries to boost innovation and productivity.

• Address weaknesses in the technology services sector (e.g., data services, cloud and AI infrastructure) to close capability gaps.

• Improve the ecosystem for the low-altitude economy (Dikong Jingji 低空经济), supporting industries such as urban air mobility, logistics drones, and related services.

• Advance high-quality development of the digital economy (Shuzi Jingji 数字经济), with emphasis on sustainable, innovation-driven growth.

Why this matters — plain language

• Policy clarity: A central push to curb involution signals regulatory intent to discourage wasteful, zero-sum competition and to redirect resources toward productive innovation.

• Industrial shift: Prioritizing emerging industries and expanding AI+ gives clearer market signals for investment in AI infrastructure, software services, advanced manufacturing, and digital platforms.

• Support for ecosystems: Closing gaps in technology services and building the low-altitude economy ecosystem will enable faster commercialization of new technologies, such as drones and edge AI.

• Market implications: Firms focused on AI, cloud and infrastructure services, and low-altitude economy applications are likely to see improved policy support; outcomes will depend on follow-through and funding.

Practical takeaways for businesses and investors

• Expect tighter scrutiny of duplicative capacity.

• Look for policy measures favoring consolidation or reallocation of excess supply in overbuilt sectors.

• Companies with measurable AI and digital transformation wins should prepare documentation that shows productivity gains and compliance with evolving standards.

• Early-stage firms in drone logistics and urban air mobility should monitor pilot programs and local licensing frameworks closely.

• Investors should watch for targeted funding, procurement, and industrial policies that shift from announcements to concrete projects and budget commitments.

Action checklist — for founders, operators, and investors

• Map your regulatory exposure. Identify where your business could be affected by capacity governance or consolidation incentives.

• Prove value with metrics. Track and present productivity improvements from AI, cloud migration, and automation.

• Engage in pilot programs. Participate in local demos and licensing pilots for low-altitude economy use cases to accelerate commercialization.

• Prepare to bid for government procurement. Monitor procurement windows and align product roadmaps with public-sector priorities.

• Monitor capability gaps in tech services. Position offerings around data services, cloud, AI infrastructure, and edge compute to capture demand where the market lacks capacity.

What to watch next

• Concrete budgets and pilot locations. Announcements matter only if followed by funding and local pilots for AI, drones, and digital infrastructure.

• Regulatory detail on capacity governance. Watch for rules on consolidation, capacity caps, or restructuring incentives that affect supply-heavy sectors.

• Procurement signals from central and local governments. These often reveal the fastest path to market for startups aligned with national priorities.

How investors should think about risk and opportunity

• Risk: Policy statements can outpace implementation; capital deployed without regulatory clarity is higher risk.

• Opportunity: Clear industrial priorities — like AI+, low-altitude economy, and technology services — create a funnel for prioritized projects and procurement.

• Strategy: Favor companies that can demonstrate measurable outcomes, regulatory alignment, and an ability to participate in government-led pilots.

Bottom line

This agenda signals a shift from scale-for-scale’s-sake to focused, capability-driven growth across AI, cloud, and the low-altitude economy.

Companies and investors who align with measurable productivity gains, regulatory compliance, and pilot-ready products are best positioned to benefit.

References

• Cailian Press (homepage) – 财联社
• National Development and Reform Commission — Official Website – 国家发展和改革委员会
• Coverage: National Development and Reform Work Conference – Xinhua News

NDRC tackles “involution” competition and expands “AI+”