context: Digital products and services are key to China’s transition to a consumption-driven economy, with calls for accelerating them to ease US–China trade tensions. In August 2017 State Council set targets, including for 11 percent annual growth, and now MIIT and NDRC are following up with an action plan. National Bureau of Statistics figures for H1 2018 show that the digital economy grew 15 percent y-o-y to reach 2.3 tn, and that consumption has exceeded investment and trade to become the main economic driver, accounting for 78.5 percent of GDP growth.

Ministry of Industry and IT (MIIT) and National Development and Reform Commission (NDRC) issued ‘3-year action plan for boosting and upgrading digital economy (2018-20)’ on 10 August. The Plan sets the following goals for 2020

  • 6 tn digital economy
  • 98 percent of administrative counties connected to fibre-optic networks and 4G internet
  • launching digital economy pilot cities and projects
  • promote internet+ healthcare, aged-care, education and cultural industries
  • improve legal frameworks

Main tasks include

  • supply side: boost R&D and commercialisation of
    • mid to high-end mobile phones, computers, televisions, audio devices, wearable devices, AR/VR products and drones
    • health monitors, home service robots, smart aged-care products
    • ultra high-definition and flexible displays
    • connected and autonomous vehicles (CAV)
  • technological innovation
    • promote industrial cloud platforms and software
      • launch 100 pilots among SMEs
    • pilot ‘smart city’ programs and extend R&D in cloud computing, big data analytics, AI and blockchain for urban governance
    • update internet technology standardisation system (ITSS) to version 5, and ensure 2,000 enterprises are qualified
    • promote e-commerce, online payment, digitised logistics and supply chain management
    • offer online entrepreneurship and innovation services for SMEs
  • consumer empowerment
    • upgrade internet infrastructure, including 5G, IPv6 and fibre-optical networks
    • improve digital literacy among rural citizens and the elderly
  • market environment