The People’s Bank of China (PBOC) has just released a working paper calling for the Chinese government to exercise greater policy guidance with regard to the tech sector.
The No. 8 working paper entitled “Cost Structure and Enterprise Upgrade and Transition – Service-based Guidance Logic Research” (成本结构与企业升级转型——基于服务主导逻辑的研究) said that “government must strengthen policy guidance” when it came to the financing of tech companies.
“Financial institutions must change their financial development concepts, and better service tech innovation and brand creation,” said the paper.
“With regard to enterprises with high R&D costs, expansions to tax benefits may be implemented to stimulate the R&D initiative of enterprises.”
The working paper also called for the “establishment of innovation funds, the provision of financial subsidies and talent subsidies to enterprises with high R&D costs, and the resolution of the funding bottleneck issues of enterprises during transition and development.”