A worker adjusts a product assembly robot at the workshop of a cleaning products manufacturing enterprise in Yichang, Hubei Province, on Feb. 19, 2025. Photo: IC PHOTO

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In the bustling commodity market of Yiwu, Zhejiang Province, an AI design platform empowers small and medium-sized merchants to generate thousands of product designs in just three minutes. Meanwhile, in Foshan, Guangdong Province, an industrial cloud platform has revolutionized the operations of 20,000 manufacturing enterprises, enabling them to seamlessly execute intelligent production scheduling.

These cities stand as powerful examples of how private enterprises are driving the seamless integration of AI with diverse economic sectors, unleashing extraordinary potential for industrial innovation. The fusion of cutting-edge technology with entrepreneurial agility is reshaping the future of China’s economy.

On Feb. 17, 2025, General Secretary of the CPC Central Committee Xi Jinping delivered an important speech at a symposium on private enterprises, marking his second attendance at such an event since November 2018. Xi’s remarks further reinforced the private sector’s confidence in advancing high-quality economic development.

Consistent policy support

Since reform and opening up, China’s private economy has flourished over the course of more than four decades, evolving from modest beginnings to a formidable force. It has grown steadily into a crucial component of the national economy, akin to its “capillaries.” By the end of September 2024, the total number of private businesses in China had exceeded 180 million, making up 96.37% of all business entities.

He Dexu, director of the National Academy of Economic Strategy at the Chinese Academy of Social Sciences (CASS), remarked that the recent symposium continued the longstanding policy of affirming, encouraging, and supporting private enterprises and entrepreneurs. It also reaffirmed the consistency of the Party and state’s fundamental guidelines regarding the development of the private economy.

In recent years, the central government has introduced numerous policies to support the private sector. Beyond continuing previous policies, the meeting marked a series of “breakthroughs,” particularly with regard to strengthening legal safeguards and policy enforcement. One of the key proposals was to “strengthen law enforcement supervision and take focused actions to fight arbitrary charges, fines, inspections and seizures,” underscoring the importance of rigorous policy execution.

From He’s perspective, these ongoing and evolving support policies indicate a shift in the central government’s strategic positioning of private enterprises—from a focus on “seeking development” to “spreading their wings.” This marks a transition from simply stabilizing growth to emphasizing both high-quality development and social responsibility.

The symposium not only addressed the direction of economic development but was also closely tied to the employment, livelihoods, and overall quality of life for hundreds of millions of citizens. As the most dynamic players in the market economy, private enterprises contribute over 80% of urban employment and support the livelihoods of more than 400 million families. In terms of public welfare, private micro, small, and medium-sized enterprises—comprising over 90% of the 125 million market entities—continue to improve public services and the overall standard of living through community commerce, convenient services, and new forms of individual economy.

Spurring sci-tech innovation

As the ongoing scientific and technological revolution drives dramatic industrial transformations, the global economy is increasingly shifting toward digitalization and green innovation, further fueling the development of fields such as artificial intelligence, semiconductors, and robotics.

At the symposium, Xi urged private enterprises to “boost independent innovation” and contribute more significantly to technological progress. The event brought together executives from tech-forward companies such as Huawei, Unitree, DeepSeek, and BYD, highlighting the importance of innovation in driving future economic development.

Concentrated in the fields of science and technology and people’s livelihood, the participating enterprises represent new quality productive forces and the future direction of China’s economy, constituting the locomotive of growth. Zhang Yongsheng, director of the Research Institute for Eco-civilization at CASS, stated that these enterprises reflect the best of China’s private sector, heralding the bright prospects of the nation’s economy. The entrepreneurial spirit embodied by these dynamic private enterprises has fueled remarkable successes in new energy, electric vehicles, AI, chips, robotics, 5G, and other groundbreaking fields.

As of now, China boasts over 420,000 private high-tech enterprises, which account for more than 92% of the nation’s total. These businesses have contributed over half of the country’s robust exports in sectors such as new energy vehicles, lithium batteries, and photovoltaic modules, as well as 65% of all patent inventions.

Over the past years, China’s high-quality economic development has been marked by disruptive innovations in advanced technologies, particularly in AI. From Huawei’s Ascend AI chips overcoming chip embargoes, to DJI’s drones taking the global lead, and the striking emergence of DeepSeek, Chinese private enterprises are transforming the foundational logic of industrial innovation. This underscores their ability to create agile innovation systems closely aligned with market demands.

According to data from the Ministry of Industry and Information Technology, 83% of core AI-related technological innovations in China are driven by private enterprises. These firms have become a new force in AI development, leveraging their flexible decision-making structures to rapidly capitalize on technological trends, gaining a unique competitive edge.

“In the current context, the role of the private sector is increasingly prominent in scientific and technological innovation and industrial upgrading of private enterprises, particularly in overcoming international technological blockades,” said Li Xuesong, director of the Institute of Economics at CASS. “For the time to come, the Chinese economy will experience three critical periods—reshaping new advantages in international competition, sidestepping the ‘middle-income trap’ to obtain the high-income status, and transforming old drivers into new ones.” Li concluded that the symposium was not only a response to the complex domestic and global landscape but also a blueprint for the future of China’s economy.

Edited by CHEN MIRONG