China’s 2023 Two Sessions Calls for Greater Use of Data Assets by Financial Sector, Establishment of National Digital Authority

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Multiple delegates to China’s annual Two Sessions congressional event for 2023 have raised matters in relation to the development country’s digital economy, including laws for digital assets and the need for a new state-level data authority.

Cao Peng (曹鹏), member of the National Committee of the Chinese People’s Political Consultative Conference (CPPCC), chairman of the JD Group Technical Committee, and president of JD Cloud Division, highlighted the ability of digital transformation to supercharge China’s economic growth.

“New types of enterprises have played an important role in empowering the digital transformation of the upstream and downstream of the supply chain, boosting cost reductions and efficiency gains for the industrial chain, and assisting digital and real integration and high-quality development,” Can said.

“The rearing and development of these new types of enterprises is of great significance. I propose encouraging these new types of enterprises to assist small and medium-sized enterprises in using the cloud to use digital [technology] to enhance their smarts.”

Yu Miaojie (余淼杰) deputy to the National People’s Congress (NPC) and president and deputy secretary of the Party Committee of Liaoning University, and president, called for further development of digital infrastructure in China by making use of the market.

“It is necessary to increase support for the development of supply chain infrastructure and digital and intelligent transformation; give full play to the role of the market in resource allocation, use industrial development as a carrier, encourage the participation of various market players, form an efficient and advanced digital and smart social supply chain, build an efficient and smooth circulation system, and aid in the high-quality development of the real economy.”

Digital asset security and legislation

Congressional delegates called for greater legislative and security measures in relation to digital and virtual assets, including NFTs, digital currency and online gaming accounts, in order to buttress the development of the digital economy.

Zhou Hongyi (周鸿祎), member of the National Committee of CPPCC and founder of 360 Group, called for local governments in China to play a greater role in this regard.

“The development of municipal digital security service centers as a key means for expanding domestic demand and stabilizing growth,” he said. “[We should] include them in the development plans of provinces, cities, counties, and industrial parks, organize the selection of outstanding cases for urban digital security service centers, and promote the continuation of urban digital security development models Optimize and perfect.”

Gong Fuwen (巩富文), member of the National Committee of the CPPCC and vice president of the Shaanxi Supreme People’s Court, called for the judiciary to play a greater role in underpinning the development of the digital economy.

“As a way to settle and stop disputes, the judiciary is best at finding a balance between conflicts of interests that have not yet been finalized, determining the judgment rules suitable for a specific time and place, and promoting the healthy and balanced development of the digital economy industry under the guidance of legal principles through the innovation of judicial rules,” Gong said.

“This will provide the power of the rule of law to the development of the digital economy.”

Clarification of digital property rights and use of data assets for finance

Zhang Qi (张琦), member of the National Committee of the CPPCC and chairman of Shanghai Data Exchange, highlighted the key role played by data exchanges and the establishment of clear property rights in driving the growth of the digital economy and the market for data assets in particular.

“To build a unified national data asset market, we should make clear that the registration and confirmation of data assets and the management of data asset certificates are the statutory functions of a national data exchange,” Zhang said.

“[We should] explore a new model for the inclusion of data assets in balance sheets, and expand the use of data assets into areas including equity contributions, mortgage financing, and asset securitization.”

Development of a national digital assets authority

As part of far-reaching adjustments to China’s administrative and regulatory structure, the Two Sessions in 2023 has also seen a proposal for the establishment of a state-level authority for digital assets.

The State Council’s proposal for institutional reform issued on 7 March calls for the establishment of a National Data Bureau (国家数据局) under the management of the National Development and Reform Commission (NDRC) – China’s planning authority.

The new bureau will be responsible for “coordinating and promoting the development of basic data systems, coordinating the integration, sharing, development and utilization of data resources, and coordinating the promotion of a Digital China, digital economy, and digital society planning and construction.”

“The establishment of the National Data Bureau represents the nation’s determination to vigorously promote the development of data as factor of production, and also reflects the broad prospects for the development of related industries,” said Zheng Ding (郑定), president of the Shenznehn Information Services Sector Blockchain Association.

“I expect it to further increase support for the Digital China strategy and promote the standardized and healthy development of the data industry.”