ditor’s note: As the annual Two Sessions commences, CGTN’s Visionary Voices has launched the “Global Think Tanks Unpack China Agenda 2025” series. Authored by experts from think tanks worldwide, these articles offer cutting-edge analysis of China’s advancements in fields spanning the economy, technology, rural revitalization and cultural innovation. Each piece demystifies China’s growth trajectory while illuminating its global significance. The eighth article explores the specific areas of “new quality productive forces” and China’s efforts to develop these industries. Stephen Ndegwa, the author of this article, is the Executive Director of South-South Dialogues, a Nairobi-based communications development think tank. The article reflects the author’s views and not necessarily those of CGTN.
In September 2023, during his visit to northeast China, Chinese President Xi Jinping introduced the concept of “new quality productive forces,” emphasizing innovation as a key driver of economic transformation. New quality productive forces represent a break from traditional economic growth patterns, advocating for high-tech, high-efficiency, and high-quality production driven by technological advancements.
As China enters its 2025 Two Sessions, this forward-looking economic model is set to take center stage in discussions about the nation’s industrial future. To elevate these productive forces, China is prioritizing three key strategies: disruptive technological innovation, enhancement of total factor productivity (TFP), and the cultivation of emerging industries. TFP measures efficiency in utilizing labor and capital. Enhanced digital transformation, including industrial automation and smart logistics, will be instrumental in improving TFP across sectors.
In the government work report released on March 5, several industries that meet the concept of “new quality productive forces” were clearly marked. The Chinese government will focus on promoting the safe and healthy development of commercial aerospace this year, cultivate future industries such as biomanufacturing, quantum technology, embodied intelligence, and 6G, accelerate the digital transformation of the manufacturing industry, and vigorously develop a new generation of smart terminals and smart manufacturing equipment such as smart networked new energy vehicles, artificial intelligence (AI) mobile phones and computers, and smart robots.
China’s spending on AI could reach $38 billion in 2027, accounting for about 9 percent of the global market. The application of AI in manufacturing, such as AI-powered predictive maintenance systems and automated quality control, will increase production efficiency by 30 to 50 percent in key industries like automotive and electronics. Companies like Huawei and SenseTime are leading the charge in AI research, pushing China towards a smarter, more automated industrial landscape.
An unmanned pharmacy robot debuts at the 2024 China International Fair for Trade in Services in Beijing, capital of China, September 15, 2024. /CFP
China has already laid the groundwork for smart factories and intelligent supply chains. For example, Haier, a global leader in home appliances, has implemented an Internet of Things-driven manufacturing process, which has significantly shortened production time while reducing waste. Additionally, China’s digital economy, which accounted for 41.5 percent of GDP in 2022, is expected to grow further with continued investment in industrial software, cloud computing, and cybersecurity infrastructure.
A key area for improvement is integrating digital tools across traditional industries. In agriculture, for instance, AI-powered precision farming and smart irrigation systems can optimize resource use and boost yields. Similarly, in transportation, China’s intelligent traffic management systems, such as those implemented in Shenzhen, have cut congestion time by up to 20 percent, leading to increased overall economic efficiency.
China’s commercial space industry is another frontier that aligns with “new quality productive forces.” Companies like Galactic Energy are pioneering reusable rocket technology, reducing launch costs and opening new opportunities for satellite-based services in communications, earth observation, and global positioning.
Green industries epitomize the principles of “new quality productive forces,” as they combine high-tech innovation with environmental sustainability. China’s dominance in the renewable energy sector has not only propelled domestic economic transformation but has also facilitated global sustainable development through green technology exports.
China’s leadership in renewable energy positions it as a global supplier of green technologies. By the end of December 2024, China’s cumulative installed power generation capacity was about 3.35 billion kilowatts, a year-on-year increase of 14.6 percent. Among them, the installed capacity of solar power generation is about 890 million kilowatts, a year-on-year increase of 45.2 percent; the installed capacity of wind power is about 520 million kilowatts, a year-on-year increase of 18.0 percent. The expansion of battery storage solutions and hydrogen fuel cell technology will further drive the green transition.
China is the world’s largest exporter of solar panels, accounting for 80 percent of global supply. In Africa, Chinese firms have played a pivotal role in electrification projects, with companies like PowerChina leading the development of solar farms in Kenya and Ethiopia. Additionally, China’s advances in electric vehicle (EV) production have positioned it as a key player in the global transition to clean transportation. In 2023, China exported 1.2 million EVs, a 77.6-percent increase from 2022, with key markets including Europe and Southeast Asia.
To further enhance its leadership, China is expected to continue investing in next-generation green technologies such as carbon capture and utilization, and hydrogen energy. The recent launch of the world’s first floating wind power-fishery integrated platform off the coast of east China’s Fujian Province demonstrates the country’s commitment to innovation in green energy.
Taking “new quality productive forces” to a higher level requires a multifaceted approach that prioritizes disruptive innovation, digital transformation, and the cultivation of emerging industries. Enhancing TFP through AI, automation, and smart supply chains will ensure sustainable economic efficiency.