Wang said the government would “study the possibility of establishing a national-level M&A fund” as part of a broader strategy to strengthen the planning and execution of public investment. The initiative is intended to boost innovation and entrepreneurship and to support what Beijing calls “new productive forces” in advanced-technology sectors regarded as strategically important. While no timelines or funding levels were specified, the statement underscores the priority China is placing on long-term investment in future-oriented technologies.
The proposed M&A fund would complement China’s existing investment ecosystem, which already includes a state-backed venture capital fund worth 100 billion yuan (about $14.3 billion). Yin Ming, vice president of Shanghai-based Baptized Capital, said such a fund could stimulate more consolidation among technology companies that have reached a certain scale. This, in turn, could provide clearer exit opportunities for investors — including early-stage backers linked to state funds — and lower entry barriers for private capital.
China has been steadily channeling investment into strategic technology sectors, including semiconductors and data-center infrastructure, in an effort to strengthen domestic capabilities. A national M&A fund would fit into this broader policy direction and is widely seen as part of Beijing’s response to mounting technological pressure from the United States, which has used export controls and sanctions as tools in areas such as advanced chip manufacturing.
Experts note that China’s model of state-backed investment has advantages, including longer investment horizons than those typical of purely private capital. At the same time, critics argue that lower risk tolerance on the part of the state could constrain the growth of the most dynamic technology firms, and that a larger role for private investors might foster greater innovation.
Referring to what he called external “strangulation” of China’s technology sector — including US export restrictions — Wang said that “practice has shown that no blockade can stop progress,” adding that China possesses a “strong spirit of innovation and enormous potential.”
The discussion of a national M&A fund comes as global competition in high-end technologies — including AI, semiconductors, and robotics — continues to intensify, with governments around the world seeking to build strategic advantages through industrial policy and direct capital support.
