Aug 21, 2026 (InvestinChina.asia) – China’s top internet and cyberspace authority has issued a comprehensive action plan aimed at bolstering domestic cybersecurity and information technology (IT) firms, explicitly directing resources toward the development of high-end artificial intelligence chips and foundational software as part of a broader push for technological self-sufficiency by 2030.

The blueprint, released on Thursday by the Office of the Central Cyberspace Affairs Commission, outlines a multi-pronged strategy to cultivate globally competitive “cyber and information” enterprises. It serves as a cornerstone for the nation’s 15th Five-Year Plan period, framing the digital sector as a critical driver for “new quality productive forces” and national security.

Core Technology and AI Ambitions

At the heart of the plan is a directive for companies to intensify basic research across high-end chips, operating systems, industrial software, and network security. Beyond current bottlenecks, the policy urges breakthroughs in frontier fields such as quantum technology, blockchain, brain-computer interfaces, and digital twins.

Specifically targeting the artificial intelligence boom, the commission is calling for the development of high-performance AI chips and clusters, alongside performance enhancements for large language models, multimodal models, and world models. The plan also encourages corporate participation in open-source communities and prioritizes intellectual property protections through expedited review mechanisms.

A Three-Tiered Corporate Ecosystem

To structure the industry’s growth, regulators will implement a classification system to nurture three distinct categories of enterprises:

• Ecosystem-dominant leaders capable of setting global technical standards and integrating market resources.
• Industry-leading firms in specialized niches, tasked with spearheading technical standards and fostering industrial clusters.
• High-growth innovative start-ups, with the government pledging to accelerate the incubation of more “gazelle” and “unicorn” companies through focused support for rapid iteration and market expansion.

Digital Transformation Across Sectors

The action plan extends far beyond the tech sector, mandating that cyber firms empower traditional industries. This includes driving manufacturing digitalization through industrial internet platforms and “AI-powered” smart factories. In agriculture, the policy promotes “AI + agriculture” and rural e-commerce, while in consumer markets, it encourages the development of AI-powered terminals, wearables, and immersive digital consumption scenarios. Notably, the plan calls for inclusive design, ensuring digital services are accessible to the elderly and people with disabilities.

Global Expansion and Regulatory Guardrails

While encouraging domestic champions to “go global”—particularly via BRICS, the Shanghai Cooperation Organisation, and Belt and Road frameworks—the authorities are establishing dedicated service systems to mitigate overseas compliance risks. This includes creating legal guidance centers and monitoring mechanisms for unjustified trade restrictions.

Simultaneously, regulators are doubling down on domestic oversight. The plan explicitly vows to combat “involution-style” (vicious internal) competition, enforce anti-monopoly laws, and ban practices that force merchants to choose between platforms. Content management will be tightened, with stricter algorithm governance and protections against AI abuse, alongside ongoing crackdowns on online defamation targeting businesses.

Financing and Data Flow Reforms

To finance this ambition, the state will leverage government investment funds to support early-stage, long-term, and “hard-tech” ventures. Financial institutions are encouraged to design products using patents, trademarks, and data as collateral. The plan supports listing these firms on the STAR Market and ChiNext, while promoting secondary private equity funds and M&A funds to create a robust “investment-exit-reinvestment” cycle.

On data governance, the plan seeks to streamline cross-border data transfers. While national security classifications remain paramount, it encourages Free Trade Zones to issue “negative lists” for data exports and establish cross-border data service centers, ensuring foreign and small-to-medium enterprises can navigate compliance efficiently.

Talent and Implementation

Recognizing a skills gap, the policy vows to deepen digital talent cultivation through university-industry collaborations and fast-track visa or residency pathways for highly sought-after tech experts.

The Central Cyberspace Affairs Commission will oversee implementation, establishing dynamic monitoring mechanisms and conducting regular policy evaluations to ensure local governments effectively execute the measures.