The Chinese president presented a Five-Year Plan, which was worked on behind closed doors by his close circle for months and serves as a guide for the country’s development over the next half decade.
In an era marked by US military actions in foreign countries and commercial turmoil, Chinese President Xi Jinping is betting on a plan to protect his country from the international storm: boosting innovation to transform China into the world’s leading technological superpower.
Over the next five years, China seeks to modernize its already powerful industrial sector, reinforce technological “self-sufficiency” and incubate sectors that will help accelerate the country’s technological supremacy, from artificial intelligence and robotics to aerospace and quantum computing.
“For the first time, China wants to lead in several technologies. Previously, the focus was always on reaching the West”, highlights Dan Wang, China director at political risk consultancy Eurasia Group.
The details of Xi’s strategy for the future were approved by the Chinese parliament in Beijing. The political document, known as the Five-Year Plan, was drawn up behind closed doors by Xi Jinping’s close circle for months and serves as a guide for the country’s development over the next half decade.
“Strive to achieve new breakthroughs in promoting original innovation, combating key core technologies and achieving strategic position in science and technology,” said Xi, addressing local authorities at a meeting on the new plan.
As the Chinese economy faces deep structural challenges, including a persistent housing crisis and low consumer confidence, Xi is focusing on strengthening the technology sector, proactively betting on emerging technologies to drive the country’s growth in the coming decades. Last week, China set its lowest economic growth target since it began adopting such figures.
Chinese President Xi Jinping at the closing session of the National People’s Congress (NPC), the country’s merely formal legislative body, in Beijing, on March 12, 2026. Andres Martinez Casares/AFP/Getty Images
“Faced with turbulent international dynamics and a series of risks and challenges, we must focus on doing our job well, (…) consolidating and expanding our strengths, removing bottlenecks and restrictions and strengthening our weaknesses”, the document reads.
Although Xi Jinping is expected to host US President Donald Trump in Beijing later this month to discuss, among other issues, the extension of the trade truce, experts say that relations between the world’s two largest economies will continue to compete against each other over the next five years.
“Collaboration will decrease in all aspects, from academia to industries. Both sides want to reduce dependence on each other and, therefore, the decoupling is mutual”, theorizes Wang, from Eurasia Group, warning that bilateral tensions could reignite after a period of calm brought about by the trade truce.
In an uncertain world, China is positioning itself as a “stabilizing anchor for the global economy,” describes Henry Huiyao Wang, president of the Center for China and Globalization, a Beijing-based think tank.
“The China that the US deals with today is a highly organized country, still driven by a strong vitality and pace of growth, and moving forward with a clear strategic determination through successive five-year plans”, explains the analyst, who previously served as an advisor to the Chinese cabinet, the State Council.
The long-term strategy
The state-led Chinese model is helping the country quickly close the gap in research and development spending relative to the United States.
Beijing has committed to a 10% increase in the annual budget for science and technology – in line with the pace of growth over the past two years. The plan also establishes the objective of increasing annual investment in research and development by at least 7%.
Young people line up to install OpenClaw, an open-source AI assistant, on their laptops at Baidu headquarters in Beijing on March 11, 2026. Adek Berry/AFP/Getty Images
“China now leads the world in research, development and application in areas such as artificial intelligence, biomedicine, robotics and quantum technology, and new advances have been made in independent chip research and development”, reads a government report released last week.
The term “artificial intelligence” was mentioned in the plan more than 50 times – and it’s an area where China has already proven itself to be one of the top players, dominating major open source language models and raking in huge sums in market launches.
In addition to chatbots, Beijing’s ambitions range from AI robots to “agent AI,” or systems that can handle tasks beyond conversation. The plan also promises to build hyperscale computing clusters to address the shortage of advanced computing capacity for AI.
Together, the initiatives aim to expand China’s AI-related industry to a value of more than 10 trillion yuan (about 1.3 billion euros) by the end of 2030.
Unresolved obstacles
Beijing’s decision to redouble efforts towards self-sufficiency shows China’s urgency in wanting to free itself from dependence on Western technology. Despite highlighting progress in national technologies, the plan provided for “extraordinary measures” to achieve “decisive advances” in essential sectors, particularly advanced chips.
Export controls imposed by Trump during his first term, and later tightened by the Biden administration, have stifled the country’s semiconductor sectors and the industries that depend on them, including the development of cutting-edge AI models.
Kendra Schaefer, partner at Trivium China consultancy, based in Beijing and specializing in technology policies, stated that the country considers “freeing itself from alleged US influence as an immediate strategic need” in the AI chip sector, although it does not appear to have “any illusion” that it will be capable of producing a chip equivalent to those from North American giant Nvidia in the next five years.
Instead, Schaefer adds, Beijing has turned its attention to “parts of the semiconductor supply chain or future semiconductor technologies that have not yet fully matured,” seeking to gain an advantage in these areas.
A robotic hand prepares the packaging of semiconductor chips at Shandong NEM Semiconductor Co., Ltd. in Binzhou, China, January 28, 2026. Guo Zhihua/VVCG/Getty Images
“China’s quest for technological sovereignty goes beyond current control, as it is not a mere catch-up game,” said an article published in
But the domestic focus also reflects China’s economic reality. The country has for decades leaned on its role as the world’s factory and its exports to drive growth, even as its growing trade surpluses have increasingly drawn fury from its trading partners. Meanwhile, the Chinese economy has faced a prolonged housing crisis, weak domestic demand and excess industrial capacity in recent years, resulting in deflationary pressures.
Lynn Song, chief economist for Greater China at Dutch bank ING, says the plan’s strong domestic focus signals both a growing backlash against China’s trade imbalances and Beijing’s recognition of elevated external risks.
This “can be seen as a way for China to ensure that the foundations for its growth are controlled internally, rather than relying on maintaining a constructive external environment”, suggests Song.
*Rae Wang contributed to this article
