Other BriefingsChina’s 15th Five-Year Plan: Key Insights for Foreign Investors
China’s 15th Five-Year Plan sets out the country’s economic and industrial development priorities for the period from 2026 to 2030, with a heavy emphasis on technological self-sufficiency, industrial upgrading, and the cultivation of emerging industries. Alongside its technology agenda, China’s 15th Five-Year Plan also addresses longstanding structural challenges, including sluggish domestic consumption and declining foreign investment, outlining measures to boost household spending and expand market access for foreign companies.
On March 12, the National People’s Congress officially adopted the 15th Five-Year Plan for Economic and Social Development (15th FYP), marking a defining moment in China’s economic and industrial trajectory. This vast document will be the binding guide for the social and economic development of the country for the period from 2026 to 2030. While the final version of the document has not yet been released, the extensive draft outline provides a comprehensive overview of the country’s policy priorities and growth agenda up until the year 2030 and beyond, sending a strong signal to all stakeholders in the country of where to place the greatest resources and efforts.
One of the key takeaways from the 15th FYP draft is a heavy focus on technology and tech self-sufficiency, with a broad range of policy measures spanning the entire innovation chain. These range from modern upgrades to traditional industries to frontier fields on the bleeding edge of possibility, including AI and robotics, quantum computing, biomanufacturing, and more.
Beyond science and technology, the 15th FYP draft also doubles down on China’s long-standing efforts to boost domestic demand and to further open up the economy to foreign investment and trade. For foreign investors, understanding the priorities and direction set out in the plan is essential to identifying where opportunities lie and where the competitive landscape is set to intensify.
| Key Economic and Social Development Targets, 14th vs. 15th FYP | |||||
| Area | Indicator | 2025 | 14th FYP Target (2025) | 15th FYP Target (2030) | |
| Economy | GDP growth (%) | 5 | Keep within a reasonable range, annual targets set as appropriate | Keep within a reasonable range, annual targets set as appropriate | |
| Labor productivity growth (%) | 6.1 | Above GDP growth rate | Above GDP growth rate | ||
| Urbanization rate (%) | 67.9 | 65 | 71 | ||
| Innovation | Society-wide R&D expenditure growth (%) | 9.1 | >7, striving for higher than 13th FYP level | >7 | |
| High-value invention patents per 10,000 people (no.) | 16 | 12 | >22 | ||
| GDP share of core digital economy industries added value (%) | 10.5 (2024) | 10 | 12.5 | ||
| Welfare | Surveyed urban unemployment rate | 5.2 | <5.5 | <5.5 | |
| Per capita disposable income growth (%) | 5 | Basically in line with GDP growth | In line with GDP growth | ||
| Average years of education of working-age population (years) | 11.3 | 11.3 | 11.7 | ||
| Healthcare workers per thousand people | Licensed doctors (no.) | 3.1 | 3.2 | 3.7 | |
| Licensed nurses (no.) | 4.3 | NA | 5.1 | ||
| Nursing care beds in elderly care institutions (%) | 68 | NA | 73 | ||
| Increase in enrollment rate of children under 3 in daycare | NA | NA | + 6 percentage points (cumulative over 5 years) | ||
| Life expectancy (years) | 79.25 | 1 (increase, cumulative over 5 years) | 80 | ||
| Green & low-carbon | Reduction in CO2 emissions per unit of GDP (%) | 17.7 (cumulative over 5 years) | 18 (cumulative over 5 years) | 17 (cumulative over 5 years) | |
| Proportion of non-fossil energy in total energy consumption (%) | 21.7 | NA | 25 | ||
| PM2.5 concentration in cities at the prefecture-level and above (µg/m³) | 28 | NA | <27 | ||
| Proportion of excellent water bodies (%) | 80 | NA | 85 | ||
| Forest coverage rate (%) | 25.1 (2024) | 24.1 | 25.8 | ||
| Security | Comprehensive grain production capacity (trillion jin) | 1.39 | 1.3 | Around 1.45 | |
| Comprehensive energy production capacity (100 million tons standard coal equivalent) | 51.3 | >46 | 58 | ||
Technological development
One of China’s top policy priorities over the 15th FYP period is scientific and technological development – particularly, the development of strategic and emerging tech industries.
The plan’s headline technology target is to maintain annual growth in total society-wide R&D expenditure above 7 percent, the same target as over the 14th FYP period. In 2025, this figure stood at 9.1 percent, while total R&D expenditure – a slightly narrower measure than “society-wide” R&D expenditure – reached RMB 3.92 trillion (US$570.7 billion), according to the National Bureau of Statistics.
Another key metric is increasing the number of high-value invention patents to over 22 per 10,000 people by 2030, up from the target of 12 per 10,000 people in the 14th FYP. In 2024, China had 16 such patents per 10,000 people. The country will also seek to increase the GDP share of the added value of “core digital economy industries” to 12.5 percent, up from 10.5 percent in 2025.
The technology goals of the 15th FYP can broadly be categorized into two priorities:
- Tech-driven modernization and upgrading of traditional industries, and development of emerging and high-tech industries.
- Strengthening technological self-sufficiency and achieving breakthroughs in emerging and cutting-edge sci-tech fields.
The first of these two categories focuses on moving China’s traditional industries – everything from steel and petrochemicals to electronics and textiles – up the value chain, to ensure long-term competitiveness of these important sectors. This has become especially important as lower-value manufacturing moves out of China, and the country struggles with labor shortages as a result of its shrinking working-age population. In tandem with this goal, China is striving to develop emerging tech industries, such as robotics and embodied AI, biomedicine, and the low-altitude economy, to name a few, into new drivers of economic growth and domestic consumption.
The second category is motivated more by national security concerns and the necessity to buttress China’s economic development against external shocks, in particular in strategic fields such as AI and semiconductors. A crucial part of this drive is to reduce the reliance on foreign technology while ensuring that China remains at the forefront of frontier technologies and scientific breakthroughs.
These two drivers, which are largely a continuation of existing policy priorities, will inform much of China’s tech and innovation policy landscape over the next five years and beyond.
Modernizing and upgrading traditional industries
The 15th FYP aims to upgrade traditional industries through differentiated sector policies, targeting structural bottlenecks and pushing production toward the mid-to-high end, with a focus on high-end and supply-scarce products across heavy and light industry.
For instance, the plan calls for making structural adjustments to steel, petrochemical, shipbuilding, and other heavy industries, while strengthening and optimizing bases for high-quality steel, first-class petrochemicals, and high-end shipbuilding and marine engineering equipment. In electronics, IT, mechanical equipment, and other manufacturing industries, the country will strive to develop high-end and scarce products and accelerate breakthroughs in key components, parts, and specialized materials. For light industry and textiles, the focus is on expanding the supply of high-quality products.
The plan additionally outlines several areas for improvement to the basic capabilities and competitiveness of traditional industries. These include fields such as high-end materials, basic components and parts (such as high-speed precision bearings, high-parameter gears and transmission devices, high-reliability hydraulic and pneumatic seals, and so on), basic software and industrial software, high-end apparatus and instruments, and major technical equipment (such as large cruise ships and large LNG transport ships, large-scale special smelting equipment, major petrochemical and chemical equipment, and so on).
Scaling and commercializing emerging industries
In the realm of emerging industries, the plan outlines mechanisms for creating the conditions to realize the commercial potential of emerging industries. Key to this will be “focusing on building a market environment and policy system conducive to the incubation and growth of emerging industries”, which will include implementing industrial innovation projects, optimizing the organizational models and evaluation system for strategic product technology innovation, and promoting the integrated development of innovation facilities, technology R&D, and product iteration and upgrading.
The plan also calls for establishing “efficient and convenient” access mechanisms adapted to the development of new business models and exploring new regulatory methods such as “sandbox regulation” and trigger-based regulation.
The plan outlines several key focus industries for development: integrated circuits (ICs), embodied AI, bio-manufacturing, new-type batteries, commercial aviation, large national aircraft (such as the Comac C919 and C909), low-altitude equipment, green hydrogen, brain-computer interfaces, and high-end medical equipment.
Strengthening technological self-sufficiency and innovation
The 15th FYP calls for a combination of technology- and demand-driven approaches to bolstering China’s technological self-sufficiency, focusing on key strategic areas while addressing supply chain weaknesses.
Among the more notable objectives, China will “adopt extraordinary measures” to achieve breakthroughs in a few core technologies, including ICs, industrial machine tools, high-end instruments, basic software, advanced materials, and biomanufacturing.
According to the plan, China will explore funding options such as awards and subsidies to make advancements in these key areas.
Additionally, China will implement “strategic deployments in AI, quantum technology, biotechnology, and new energy” and accelerate breakthroughs in basic theories and underlying technologies, while promoting their transformation and application. Mechanisms for cultivating emerging and disruptive technologies are also outlined, calling for “optimizing the environment [to make it] conducive to original and disruptive innovation”, while also innovating on selection and funding mechanisms for non-consensus projects.
Priority disruptive and emerging technologies include AI and quantum technology – specifically constructing an integrated space-ground quantum communication network, developing fault-tolerant general-purpose quantum computers and scalable special-purpose quantum computers, and making breakthroughs in key technologies for quantum precision measurement.
Strengthening the role of companies in tech innovation
The wording of the 15th FYP suggests a greater emphasis on the role of companies and individual talent in the development of cutting-edge science and technology.
The plan specifically calls for “establishing and improving a policy system to attract innovative resources such as projects, platforms, data, and talent” to companies, and “increasing the participation of companies in major national science and technology innovation decisions”. On the talent side, it states that China will seek to “improve policies regarding researchers leaving their posts to start businesses and holding concurrent positions with additional compensation, incentivizing the flow of outstanding talent to companies”.
On the policy front, the plan emphasizes the need for “strengthening the supply of inclusive policies and creating a favorable environment for enterprise innovation”.
The plan outlines several concrete support policies to achieve this:
- Increasing the deduction ratio for enterprise R&D expenses – currently, eligible companies can deduct a total of 200 percent of their R&D expenses before tax.
- Establishing an enterprise R&D reserve fund system.
- Improving policies for supporting long-term capital investment in early-stage, small-scale, long-term, and core technologies.
- Developing venture capital, broadening the sources of medium- and long-term venture capital funds through multiple channels, and leveraging the role of the National Venture Capital Guidance Fund and national-level M&A funds.
- Facilitating foreign investment in equity and venture capital.
Other measures include increasing government procurement of independently innovated products, establishing a science and technology insurance policy system, as well as strengthening IP protection rights, optimizing patent and trademark examination policies, and fully implementing the patent open licensing system.
Boosting consumption
Boosting domestic demand and consumption will be one of the country’s top priorities for the 15th FYP period. Seen as a crucial means of driving future economic growth and reducing the country’s traditional reliance on supply-side growth, the government has been striving to boost consumption, which has been sluggish in the years since the COVID-19 pandemic.
In the 2026 Government Work Report, the government announced a special fund of RMB 100 billion (US$14.5 billion) to promote domestic demand through fiscal and financial coordination, and the issuance of ultra-long special treasury bonds worth RMB 250 billion (US$36.4 billion) for consumer goods trade-in programs. It additionally stated that China will use a combination of loan interest subsidies, financing guarantees, and risk compensation to support the expansion of domestic demand.
The 15th FYP states that China will enhance people’s consumption capacity, improve their “willingness to consume”, expand the supply of high-quality goods and services, suggesting a continuation of the strategy the government has employed i recent years to boost consumption: focusing on increasing demand-side capacity while improving supply-side offerings.
Improving employment and raising incomes to strengthen demand-side capacity
On the demand side, to improve citizens’ capacity for consumption, the government will “promote employment, increase income, and stabilize expectations”. Promoting employment will involve, in part, supporting companies in stabilizing and expanding employment, encouraging individual entrepreneurship and employment, and expanding new employment spaces in the digital economy, green economy, and silver economy.
The government will also “vigorously promote income growth for urban and rural residents” by raising minimum wages, improving the operating environment for micro and small enterprises and individual businesses, and, notably, efforts to shore up the value of household assets by “promoting the healthy development of the real estate and stock markets”.
Developing service offerings and increasing purchases of high-value goods
On the supply side, the plan calls for “unleashing the potential of service consumption” by relaxing access and integrating business formats, and cultivating new growth areas for service consumption.
The plan highlights key service industries for development, including culture, sports, and tourism, as well as leisure services such as cruise ships, yachts, and RV camping, as well as services in the low-altitude economy.
For goods consumption, the plan focuses largely on boosting purchases of big-ticket items. The plan calls for optimizing real estate policies and “stabilizing expectations”, as well as shoring up housing demand.
China did not experience the same post-COVID consumption boom as other countries, in part due to the downturn of the property market following the collapse of the property developer Evergrande in 2021, which significantly impacted household spending, as much of the wealth of Chinese households is tied up in real estate.
Beyond real estate, the plan calls for boosting purchases of cars – in particular EVs – through strategies such as improving charging, battery swaps, and other infrastructure, and expanding aftermarket consumption of auto services.
Expanding market access and attracting foreign capital
According to the 15th FYP draft, China will continue efforts to expand market access to foreign companies, in particular in the services sector.
The plan calls for further expanding access in telecommunications, internet, education, culture, and healthcare, as well as implementing pilot programs for value-added telecommunications, biotechnology, and wholly foreign-owned hospitals. These are industry sectors that are currently restricted from private and foreign investment – valued-added telecom services are restricted from private investment without a permit, as are several fields of biotechnology. In recent years, China has also been expanding the areas in which wholly-foreign owned hospitals can operate.
The measures are all continuations of existing strategies, underscoring policy continuity.
The plan explicitly states that China will further reduce the negative list for foreign investment access and strengthen the connection between the revision of the negative list and expanded market access pilot programs. The 2025 version of the foreign investment access negative list reduced the number of restricted fields from 117 to 106.
The plan also calls for “promoting the efficient, convenient, and secure cross-border flow of data”, optimizing visa and residency policies, and improving digital services for foreign nationals entering the country.
China has been testing means of facilitating data export through the implementation of data negative lists in the country’s free trade zones (FTZs), offering a clearer and streamlined regulatory environment for companies based in these areas to export data under the country’s stringent data and personal information protection laws.
The plan also lays out mechanisms for attracting foreign capital. In 2025, actual use of foreign capital fell by 9.5 percent year-on-year, marking the third year of decline, although the number of registered foreign-invested enterprises has continued to climb.
This will be a figure the government is hoping to reverse over the next five years. To that end, the plan seeks to address longstanding complaints from foreign companies, including regulatory hurdles and market access barriers, pledging to “clean up documents and regulations inconsistent with the Foreign Investment Law, and ensure both market access and operational rights.” In other words, China is committing to removing rules that contradict its own foreign investment legislation and to guarantee that foreign firms can not only enter markets but actually operate in them on equal terms.
The plan additionally outlines priority industries for foreign investment, calling for “guiding more foreign investment towards advanced manufacturing, modern services, high technology, and energy conservation and environmental protection”. Foreign companies will also be encouraged to establish regional headquarters and R&D centers in China.
Key takeaways for foreign investors
The 15th FYP provides one of the clearest roadmaps for the country’s policy and development trajectory over the next five years, and thus offers insight into where efforts and support policies will be concentrated. As has been discussed, on the industrial side in particular, China is now heavily focused on science and technology, both technical upgrades of traditional industries and the cultivation of entirely new ones in frontier fields such as AI, quantum computing, and biomanufacturing.
While China strives to shore up self-sufficiency, this does not mean shutting the door on foreign participation. The plan makes it clear that foreign capital will have a role to play in advanced manufacturing, high technology, and modern services, with pledges to reduce the foreign investment negative list, clean up regulations inconsistent with the Foreign Investment Law, and expand access in long-restricted sectors such as telecoms, healthcare, and biotechnology.
At the same time, the plan reflects a clear recognition that China’s economic model needs to rebalance. Boosting domestic consumption, through higher incomes, improved employment outcomes, and a stabilized property market, is as much a priority as industrial upgrading and will have a profound impact on the opportunities and growth potential of foreign companies in China.
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