Insider Brief
- China is launching a 1 trillion yuan ($138 billion) government-backed fund to support emerging technologies, including quantum computing, in a bid to strengthen its global competitiveness, Reuters reported.
- The fund, structured as a public-private partnership, will invest in high-risk, long-term projects across sectors such as quantum computing, artificial intelligence, semiconductors, and renewable energy, according to Chinese officials.
- China has steadily expanded its quantum capabilities, with state-backed institutions and companies developing advanced quantum computers and secure communication networks, positioning itself as a major player against Western efforts in the field.
China is preparing a government-backed fund to direct 1 trillion yuan ($138 billion) into emerging technologies, including quantum computing, Reuters is reporting. It’s a move that could reshape the global competitive landscape for advanced research and commercialization.
The “national venture capital guidance fund” will invest in hard technology sectors such as quantum computing, artificial intelligence (AI), semiconductors, and renewable energy, according to Zheng Shanjie, head of China’s National Development and Reform Commission. The fund, structured as a public-private partnership, will take a long-term investment approach and tolerate higher risk, Zheng said at a press conference on Thursday, as reported by Reuters.
China has steadily expanded its financial and policy support for quantum technology, a field that promises advances in computing, communication, and sensing. The country’s focus on quantum computing has intensified in recent years, with leading Chinese institutions and companies investing heavily in developing practical applications, particularly dual-use applications. The new fund signals an even stronger push to turn research progress into viable commercial technology, potentially challenging Western efforts in the sector.
Quantum computing has the potential to solve problems that are out of reach for today’s most powerful supercomputers, particularly in materials science, cryptography and logistics. While still in its early stages, advances in quantum technology could bring competitive advantages in fields ranging from drug discovery to national security. China’s increased investment comes as the U.S. and Europe also ramp up funding for quantum research, all aiming to maintain leadership in the field.
The fund’s formation also aligns with China’s broader strategy to become self-reliant in key technologies. On Wednesday, Beijing announced plans to accelerate AI adoption and expand venture capital support to drive more technological innovations.
The government has emphasized quantum research as a priority in past five-year plans, and institutions such as the University of Science and Technology of China (USTC) and technology firms like Baidu and Alibaba have developed quantum computing prototypes.
Beyond quantum computing, the fund will also target AI, semiconductors and hydrogen energy storage, according to state media CCTV. The inclusion of these fields suggests that China aims to lead in multiple frontier technologies amid trade restrictions and intensifying global competition.
China’s commitment to quantum technology has already achieved leadership in several areas of quantum. USTC researchers have demonstrated advances in quantum communication, for example, including a satellite-based quantum network that could enable secure transmissions resistant to hacking. The country has also built some of the most powerful quantum computers, such as Jiuzhang, a photonic quantum processor that has demonstrated significant computational speed-ups in experimental tasks.
A Chinese research team recently published a paper on it Zuchongzhi 3.0, a 105-qubit superconducting quantum processor. The device completed a computational task in seconds that would take the world’s most powerful supercomputer an estimated 6.4 billion years to replicate.
Though it would be impossible to predict how this money will be allocated across those technologies, the scale of China’s planned investment could dwarf many national quantum initiatives.
The U.S. National Quantum Initiative, for example, allocated $1.2 billion over five years in 2018. Europe’s Quantum Flagship program, launched in 2018, committed to a 10-year investment of €1 billion ($1.1 billion). China’s latest move suggests it is prepared to invest at levels that could shift the balance of global quantum innovation.
U.S. Senators recently introduced the National Quantum Initiative Reauthorization Act, which would authorize $2.7 billion over five years to advance practical applications in quantum technology and bolster national security and economic competitiveness.
Reuters reported that Chinese officials introduced the fund a day after Premier Li Qiang reaffirmed Beijing’s target of maintaining roughly 5% economic growth in 2024. The fund’s size and focus indicate that China is betting on high-tech industries to drive that long-term economic expansion.
