Marching forward with China's state digital economy

CHINA'S National Development and Reform Commission unveiled plans in January to expand the country's digital economy. It added a target to China's 14th Five Year Plan (FYP) 2021-25, adopted last year, to increase the sector's gross domestic product (GDP) contribution to 10 per cent by 2025, up from 7.8 per cent in 2020.

This might be surprising in view of last year's regulatory crackdown on private providers of digital finance, ride-hailing services, education, entertainment and gambling. This comes on top of cybercurrencies being outlawed and peer-to-peer platforms regulated out of existence.

The regulatory tightening of the private sector sent a clear message that state-led digital development will be the priority. This follows the general trend that the state marches forward as the private sector retreats.