context: Xi Jinping 习近平 first introduced NPF (new productive forces) while touring Heilongjiang in September 2023. A Politburo study session on the topic in January 2024 indicated its increasing theoretical importance. With provincial work reports throughout the country calling for investments in NPF, the concept is likely to become increasingly important in policy planning and the Party’s theoretical development.
Understanding the theoretical content and practical implementation of the development of NPF is the responsibility and mission of intellectuals, contends Liu Dian 刘典 Fudan University.
NPF as a concept combines the classic Marxist theory of productive forces with the task of Chinese socialist modernisation, a concrete deepening of Deng Xiaoping’s 邓小平 maxim that technology is the first productive force, providing direction to the development model’s transition.
Social forms under specific technological conditions develop corresponding productive forces. NPF emphasises creating a new productive system through digital capital and technological innovation. Compared to traditional productive forces, it attaches greater importance to industrial coordination and innovation’s leading role in the productive structure.
NPF’s development embodies the Party’s theoretical view that it guides the development of society’s productive forces. They entail the flexible adaptation of relations of production in constructing a modern economy.
Developing NPF faces three main challenges, each manifested in a specific relationship that must be balanced
- coordinating the transition from traditional industries to new ones
- reasonably increasing scale while focusing on quality and efficient production
- internal autonomy and foreign cooperation
This process is already affecting the economy. It is resulting in increasing digitisation and high-end manufacturing. Demand for skilled labour is rising, resulting in higher wages and an increase in living standards, but also requiring support for workers in traditional industries. Coordination between the state and firms is increasing and becoming more diverse.
Capital is changing. Evolving economic conditions resulted in the evolution of capital from commercial to financial and industrial. Industrial capital has a ‘vital’ role to play in developing NPF through
- furthering accumulation
- capital allocation
- improving and upgrading industry’s structure