Recently, the People's Bank of China (central bank) in collaboration with the Ministry of Industry and Information Technology, the National Development and Reform Commission, the Ministry of Finance, the Financial Regulatory Administration, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and other six core ministries jointly issued the (Guiding Opinions on Financial Support for New Industrialization) (hereinafter referred to as the (Opinions)). This document, endorsed by seven major departments, sets the tone for the integration of production and finance in China for the coming years with unprecedented strength and clarity. The most eye-catching aspect is the clear requirement to elevate blockchain and artificial intelligence (AI) and other cutting-edge technologies to the strategic height of 'financial infrastructure', aiming to create a new digital engine for the upgrading of China's manufacturing industry and the development of the real economy.
The release of this (Opinions) marks that China's application of blockchain and AI technologies has officially transitioned from previous scattered explorations to a national strategic level of top-level design and comprehensive promotion. Its core goal is to use these digital tools to fundamentally transform traditional financial service models, addressing long-standing issues such as financing difficulties and slow financing that trouble the manufacturing industry, especially small and medium-sized enterprises, thereby providing solid support for achieving the grand goals of 'financially strong nation' and 'manufacturing strong nation'.
Core Instructions
This lengthy (Opinions) proposes 18 specific measures, the core spirit of which can be summarized as: guiding financial resources to accurately drip into the key areas of 'new industrialization', promoting the transformation of China's manufacturing industry towards 'high-end, intelligent, and green'. Among the many tools to achieve this goal, 'digital finance' has been assigned a crucial role.
(Opinions) Article 7 'Strengthen digital financial empowerment and promote the deep integration of the digital economy with the real economy' clearly instructs financial institutions in an unprecedentedly explicit tone: 'Support financial institutions in using big data, blockchain, artificial intelligence, and other technological means to simplify business procedures and improve service efficiency for the manufacturing industry, especially small and medium-sized enterprises.'
This statement officially changes blockchain and AI from optional 'added value' to the 'infrastructure' that financial institutions must build to serve the real economy. The document further requires financial institutions to strengthen long-term loan support for the construction of digital infrastructure such as 5G, industrial internet, data, and computing power centers, and to promote banks to build digital industrial financial service platforms.
If the (Opinions) propose grand strategic goals, then blockchain and AI are the two core technological engines to achieve this goal. The document not only shouts slogans but also outlines a clear blueprint for the specific application scenarios of these two technologies.
1. Blockchain: Creating trustworthy 'data credit' and 'commodity credit'. For a long time, small and medium-sized enterprises have faced difficulties in financing, rooted in their opaque credit, making it hard for banks to assess risk. The decentralized, immutable, and traceable features of blockchain technology are powerful tools to solve this trust issue.
In the field of supply chain finance: the (Opinions) propose to 'deepen financial services for the industrial chain', encouraging financial institutions to provide accounts receivable, inventory, warehouse receipts, and order financing services for small and medium-sized enterprises on the chain based on 'data credit' and 'commodity credit'. Blockchain can transmit the credit of core enterprises in the supply chain to upstream and downstream small and medium-sized enterprises. Once an accounts receivable is confirmed on the chain, its authenticity becomes difficult to alter, effectively eliminating risks such as false trade and repeated pledges that may exist in traditional models, allowing banks to confidently provide financing for small and medium-sized enterprises.
In the field of green finance: for scenarios that require strict verification, such as carbon emission trading and green manufacturing, blockchain can make the recording and verification processes of carbon footprints, environmental data, and other information completely transparent and traceable throughout, greatly reducing trust costs and regulatory costs.
2. Artificial Intelligence: Achieving precise risk assessment and capital allocation. AI plays the role of a 'smart brain', capable of processing massive amounts of unstructured data to uncover credit information that traditional risk control models find difficult to capture.
Smart risk control: AI can combine big data and smart contracts to analyze multidimensional data such as cash flow, inventory, production capacity, and water and electricity consumption in real-time, establishing more precise and dynamic credit assessment models. This allows banks to reduce their over-reliance on collateral and dare to provide loans to light-asset technology-based small and medium enterprises.
Efficiency improvement: For banks, the application of AI can shorten the loan approval time from several weeks to just a few days or even hours while significantly reducing bad debt rates. For enterprises, the efficiency of capital turnover and order scheduling will be able to align more closely with actual market demands.
New Industrialization
The joint release of the (Opinions) by the seven major departments at this time is underpinned by profound domestic and international backgrounds and long-term national strategic considerations.
First, this is an urgent need to enhance the resilience and safety level of supply chains. In the context of increasing geopolitical uncertainties, ensuring that key core technologies and important industrial chains are 'independently controllable' has become a national strategy for China. The (Opinions) explicitly propose to strengthen comprehensive financial services for key enterprises in important industrial chains and their important supporting enterprises, precisely to respond to external challenges and strengthen the internal resilience of Chinese industry.
Secondly, this is an inherent requirement for developing 'new quality productivity' and promoting economic transformation and upgrading. The core of 'new industrialization' is to break away from the old model of relying on low-cost factor inputs and transition to a new model led by technological innovation. By precisely directing financial resources to the fields of technological innovation and industrial upgrading, and preventing funds from engaging in 'involutionary' competition in low-level fields, it is the only way to achieve high-quality economic development.
Finally, this also reflects China's attitude towards technologies such as blockchain - firmly 'shifting from the virtual to the real'. Unlike some countries that waver amidst the speculative wave of cryptocurrencies, China's policy path is very clear: it severely cracks down on virtual currency speculation while steadfastly promoting blockchain as a core technology to serve the real economy.
Production and finance transformation
The (Guiding Opinions) jointly issued by China's seven major departments is not just an ordinary policy document; it is more like a mobilization order, announcing the formal initiation of a profound industrial and financial transformation led by national will. Elevating blockchain and AI to the height of 'financial infrastructure' means that they will play a foundational role in the future financial system, akin to water, electricity, and the internet.
The impact of this transformation will be profound. After the Trump administration took office, geopolitical uncertainties increased, and China's significant moves to bet on blockchain and AI not only aim to strengthen industrial resilience but also represent a key move to reshape its core competitiveness amid the increasingly fierce global competition in technology and industry.