Chen Jiangsheng: A Study on Xi Jinping's Important Expositions on the Development of the Digital Economy
Currently, a new round of technological revolution and industrial transformation is sweeping the globe. Digital technologies such as the Internet, big data, and cloud computing are accelerating, and developing the digital economy has become a critical strategic choice for seizing the opportunities of the current transformation. The massive integration of data factors [1] has brought about innovations in modes of production and daily life, penetrating every aspect of the people’s existence. Particularly under the severe conditions of COVID-19 prevention and control, the digital economy provided digital solutions for epidemic prevention and the normal functioning of people's lives; meanwhile, by leveraging its unique advantages to assist in the resumption of work and production, it has gradually become a key pillar of the modern economic system. Xi Jinping has long demonstrated foresight regarding the development of the digital economy. Since the 18th National Congress of the CPC, the development of the digital economy has been elevated to a national strategy. The report to the 20th National Congress of the CPC also emphasized the need to “accelerate the development of the digital economy, promote the deep integration of the digital economy and the real economy, and create digital industrial clusters with international competitiveness.” Conceptually organizing and analyzing the formation logic, value significance, ideological core, and practical path of Xi Jinping's important expositions on the development of the digital economy is of great practical guiding significance for clarifying the trajectory of digital economic development in the New Era.
I. The Formation Logic of Xi Jinping’s Important Expositions on the Development of the Digital Economy
Developing the digital economy is not only an inevitable requirement of the developmental stage of socialism with Chinese characteristics, but also an inevitable choice to conform to global development trends. Xi Jinping’s important expositions on the development of the digital economy were nurtured in the pioneering explorations of “Digital Fujian” and “Digital Zhejiang”; they have been threaded through the great practice of the New Normal [2] of economic development and the New Era of socialism with Chinese characteristics, serving as an important ideological guide for China’s entry into the stage of high-quality development.
1. The vision for digital economic development was nurtured in the pioneering explorations of “Digital Fujian” and “Digital Zhejiang”
As early as 2000, when informatization [3] was not yet widely popularized and digitalization had not yet fully sprouted, Xi Jinping perceived the leading role of informatization in development, utilizing the “Digital Fujian” strategy to create new advantages for Fujian’s development. He pointed out: “Informatization is the major trend of today’s world economic and social development. It is the key link for the optimization and upgrading of industries and the realization of modernization in our country and our province. None of the 'Four Modernizations' can be separated from informatization.” This fully demonstrates Xi Jinping’s foresight and vision regarding digital economic development. At that time, Xi Jinping issued an important instruction on the “Digital Fujian Project Proposal,” suggesting that the construction of “Digital Fujian” be linked with the strategy of “invigorating the province through science and education,” focusing on the talent and economic foundation of development to seize the high ground of digital economic technology. After establishing the development goals for informatization, Xi Jinping made overall arrangements and integrated planning, compiling the “Tenth Five-Year Special Plan for Digital Fujian.” Combined with the existing reality of informatization work in various regions, and upholding a long-term development mindset, he advanced the construction of informatization in a standardized manner. Xi Jinping’s planning philosophy for the construction of “Digital Fujian” reflects an emphasis on informatization infrastructure, the application of information products, and core information technologies. His thinking on digital economic development continuously moved from sprout to maturity during the advancement of “Digital Fujian.”
When working in Zhejiang, Xi Jinping applied his thinking on digital economic development to Zhejiang’s development planning in a consistent manner. During the development process, Xi Jinping particularly emphasized the need to accurately grasp the connotation of “Digital Zhejiang” and to drive industrialization through informatization. As one of the “Three Zhejiangs” within the provincial strategy of “Four Provinces and Three Zhejiangs,” [4] “Digital Zhejiang” was an important strategic goal for Zhejiang’s development. Subsequently, “Digital Zhejiang” was included in the “Double-Eight Strategy” [5] of Zhejiang Province, further elevating its strategic status as the blueprint for the digital economy gradually unfolded across the province. During his tenure as Secretary of the Zhejiang Provincial CPC Committee, Xi Jinping advocated for advancing the construction of Digital Zhejiang in light of Zhejiang’s developmental reality. In specific practice, Xi Jinping emphasized the importance of relying on scientific and technological innovation for Digital Zhejiang’s development. He proposed that digital technology should be continuously utilized to transform traditional industries, actively guiding enterprises to adopt digital technology to improve the level of informatization in production processes and management links, and encouraging enterprises to develop and produce information technology products to enhance competitiveness. The “Digital Zhejiang” strategy was of great significance for the transformation and upgrading of traditional manufacturing enterprises in Zhejiang, serving as the key driving force for their shift from low-end processing chains to high-end value chains. At the same time, Xi Jinping emphasized that in the process of industrial transformation, a sustainable development concept should be upheld to achieve the coordinated development of industrialization with resources, the environment, and ecology. Xi Jinping paid particular attention to the important role of talent in the development of Digital Zhejiang, proposing to leverage Zhejiang’s human resource advantages and improve the quality of personnel. The ideas within “Digital Zhejiang”—combining the digital economy with traditional industries, pursuing a sustainable development path, and focusing on talent—remain guiding principles for the current national development of the digital economy, fully manifesting the foresight and scientific nature of Xi Jinping’s developmental vision.
2. The vision for digital economic development is threaded through the great practice of the economic New Normal and the New Era of socialism with Chinese characteristics
Xi Jinping formally proposed that China’s economic development had entered a “New Normal” at the Central Economic Work Conference in December 2013. After entering the New Normal, the demand for growth speed was de-emphasized in favor of a greater focus on the sustainability of economic development, the pursuit of intensive growth, and the search for new drivers of economic development.
With its innovative and intensive nature, the digital economy has become a new pillar leading the economic New Normal. In light of China’s developmental reality, Xi Jinping emphasized the need to “accelerate independent innovation in network information technology and accelerate the impetus of the digital economy on economic development.” The G20 Digital Economy Development and Cooperation Initiative adopted at the 2016 G20 Hangzhou Summit clarified the concept, significance, development principles, key areas, and future direction of the “digital economy,” becoming an action guide for developing the digital economy in the New Era. On one hand, the digital economy continuously nurtures new models and business forms, promoting the emergence of personalized and intelligent manufacturing trends and developing new drivers for economic growth. On the other hand, the deepening integration of the digital economy with the real economy allows information flows to drive the movement of factors such as technology and capital, optimizing resource allocation and economic structure. Supported by the “Internet+” action, the strategy of becoming a manufacturing powerhouse, and the national big data strategy, the digital economy has continuously grown and, with its innovativeness and inclusiveness, has gradually become the key driver of development under the economic New Normal.
At the 19th National Congress of the CPC, Xi Jinping declared that “socialism with Chinese characteristics has entered a New Era, which is a new historical coordinate for our country’s development.” He proposed for the first time the new expression of “high-quality development,” pointing out that “China's economy has transitioned from a stage of high-speed growth to a stage of high-quality development, and is now in a critical period of transforming the development model, optimizing the economic structure, and shifting the growth drivers.” High-quality development implies not only valuing the quantitative accumulation of economic growth but also focusing more on qualitative improvement.
In the new stage of development, although China possesses advantages and conditions in terms of systems, governance, human resources, and market space, it still faces problems such as unbalanced and inadequate development and insufficient innovation capacity. To achieve transformative development in the New Era of socialism with Chinese characteristics, exploring new drivers of development beyond traditional factors is the only path for economic advancement.
With its technology-intensive characteristics, the digital economy has become an important foundation for innovating economic growth models and achieving leapfrog development. Accelerating the development of China’s digital economy is an effective way to address the issues of high dependency and poor autonomy in the industrial and supply chains during the high-quality development stage; it is also a key focal point for China to enhance its independent innovation capacity and strengthen its competitive advantages. The Fifth Plenary Session of the 19th CPC Central Committee proposed to “insist on placing the focus of economic development on the real economy, and unswervingly build a manufacturing powerhouse, a quality powerhouse, a network powerhouse, and a Digital China; promote the advancement of the industrial foundation and the modernization of the industrial chain; and improve economic quality, efficiency, and core competitiveness.” Under the impact of the global pandemic, developing the digital economy has become the key kinetic energy for promoting economic recovery and stabilizing economic growth. Xi Jinping’s vision for the development of the digital economy has run through the developmental process of the economy of socialism with Chinese characteristics, and has been continuously enriched and perfected alongside the evolution of the times.
3. Developing the digital economy is an inevitable choice to conform to global development trends
Since the outbreak of the international financial crisis in 2008, the world economy has been in a period of deep adjustment. Alongside slow economic growth, the frequent occurrence of geopolitical conflicts has brought more uncertainty to the world economy, and voices of anti-globalization have continuously emerged. Facing the current global situation, Xi Jinping has delivered many speeches at major international meetings, analyzing the reasons behind world economic development. Xi Jinping pointed out: “Fundamentally speaking, as the world economy has developed to this day, the kinetic energy provided by the previous round of scientific, technological, and industrial revolutions has neared its end, and the potential of traditional economic systems and development models tends to dissipate.” “The main engines that drove world economic growth over the past few decades—such as technological progress, population growth, and economic globalization—have successively entered a 'gear-shifting' period, and their driving effect on the world economy has significantly weakened. The growth momentum brought by the previous round of technological progress has gradually faded, and the new round of technological and industrial revolutions has not yet formed a full momentum.” Seeing through the phenomena to the essence, Xi Jinping pointed out that the lack of economic growth drivers is the pain point hindering the sustainable and stable development of the world economy; the world economy is currently in a gear-shifting period where old drivers are being replaced by new ones.
With the rapid development of global information and communication technologies, the digital economy has gradually become an important driver for global economic recovery and growth. In the era of big data, information technology has profoundly changed human life and social governance. Whether in terms of individual lifestyles or corporate production models, the penetration of digital technology has produced subversive changes on a global scale. Digital technology innovation plays a critical role in the long-term stable growth of a country’s economy and the reshaping of its international competitiveness. “Countries around the world regard the promotion of economic digitalization as an important kinetic energy for achieving innovative development.” “The speed, breadth, and depth of the digital economy's development are unprecedented; it is becoming a key force in reorganizing global factor resources, reshaping the global economic structure, and changing the global competitive landscape.”
Since 2020, affected by the global pandemic, the global economy has suffered a deep recession, with major economies experiencing negative growth. However, in 2020, the global digital economy grew by 3% in nominal year-on-year terms, which was significantly higher than the GDP growth rate by 5.8 percentage points, becoming a key force in boosting the global economy. The digital economy is the important direction for future world economic development, and China’s strategic layout for digital economic development is an inevitable choice to conform to global development trends.
II. The Value Significance of Xi Jinping’s Important Expositions on the Development of the Digital Economy
The development of the digital economy not only greatly facilitates the people’s lives through technological upgrades but also serves as an important engine for building a modern economic system. Xi Jinping’s important expositions on the development of the digital economy have been continuously enriched and perfected in the process of socialist modernization, possessing profound theoretical and practical value significance.
1. Digital economic development takes the people’s needs as its starting point and goal
Looking across Xi Jinping’s vision for the development of the digital economy, being people-centered is always the starting point and the final goal. As early as the “Digital Fujian” construction period, Xi Jinping had a deep perception of the idea that people’s needs are the purpose of development, emphasizing that “we must make 'Digital Fujian' close to society, close to the masses, and close to life; provide high-level, high-quality information services for the masses; and let the masses share the fruits of 'Digital Fujian' construction.” Xi Jinping paid particular attention to the construction of government informatization, emphasizing the need to actively promote the development of e-government using government public network information platforms as carriers, and to comprehensively advance the informatization process from the corporate and household sectors. Guided by the people-centered vision for digital economic development, the construction of Digital Fujian and Digital Zhejiang continuously explored new ways for informatization to serve people’s livelihoods, breaking down information barriers between the government and the masses; the e-government construction in both provinces led the country. Fujian was not only the first to complete a comprehensive government information service system but also promoted informatization operation models at the grassroots level, with successful examples such as “Digital Wuyi” and “Digital Gulou” emerging. Zhejiang, with the help of Internet platforms, gradually built government portal websites and constructed a service-oriented government. As a national pilot province for comprehensive e-government, Zhejiang's “At Most One Trip” [6] reform truly reflects the people-oriented sentiment in Xi Jinping’s important expositions on the development of the digital economy, ensuring that policies truly benefit and serve the people.
Xi Jinping’s thinking on informatization construction has always upheld the principle of "people first": “We must adapt to the expectations and needs of the people, speed up the popularization of informatization services, reduce application costs, and provide information services that the common people can use, can afford, and can use well, so that hundreds of millions of people have a greater sense of gain in sharing the fruits of Internet development.” Persisting in the people-centered development philosophy highlights the inclusive nature of the informatization development layout, pushing for the construction of informatization infrastructure in rural and other technologically backward areas, effectively bridging the digital divide between regions and between urban and rural areas, and gradually achieving full network coverage within the national borders.
In the era of big data, Xi Jinping has gained profound insight into the important role of data elements in improving people's livelihoods. He proposed that we "must adhere to the people-centered development philosophy, promoting 'Internet + Education,' 'Internet + Healthcare,' 'Internet + Culture,' and so on, so that the masses run fewer errands while data travels more, thereby continuously raising the level of equalization, accessibility, and convenience of public services." In the digital age, the convenience of information interconnectivity continues to improve. By leveraging the unique advantages of data elements in breaking down barriers of time and space, digital services enable the personalized needs of individuals or enterprises to be met and satisfied. Especially during the critical period of fighting the epidemic, the application of digital technologies such as the "Telecommunications Big Data Itinerary Card" and "Health Codes" realized more precise epidemic prevention and control without interfering with the normal life of the masses. These practical applications truly embody Xi Jinping's insistence on the developmental goal of digital economy serving and benefiting the people, and are a deep manifestation of Xi Jinping's concern for the people.
2. The Digital Economy is an Important Support for Constructing the New Development Pattern
The Fifth Plenary Session of the 19th CPC Central Committee proposed to "form a strong domestic market and construct a New Development Pattern." The New Development Pattern takes domestic circulation as the mainstay, with domestic and international dual circulation reinforcing each other. The key to constructing the New Development Pattern lies in clearing the obstacles hindering the various stages of production, circulation, distribution, and consumption; promoting the fair and free flow of productive factors; enhancing the momentum of economic development; and smoothing the economic cycle.
According to the theory of the circulation of total social capital, dual circulation emphasizes the circulation phase—namely distribution, exchange, and consumption—whereas the development of the digital economy exerts its influence primarily at the production phase, whether through the digital industry itself or the application of digital technology to the real economy. The production phase is closely linked to and interacts with the distribution, exchange, and consumption phases. The goal of the New Development Pattern is to achieve the smooth flow of productive factors across all stages of total social capital. The digital economy and dual circulation are themselves an inseparable organic whole; developing the digital economy is an important support for constructing the New Development Pattern.
The digital economy uses data elements to drive the transformation and upgrading of traditional industries, and its unique digital and informational characteristics encourage a trend of decentralization in industrial chains. For the domestic market, on the one hand, the digital economy empowers traditional industries by making interconnectivity between upstream and downstream enterprises more convenient. The factors and information possessed by various market participants can be shared, improving the supply capacity of enterprises. Especially during the exceptional period of the COVID-19 epidemic, some leading enterprises in various industries built information-based sharing platforms, opening up industrial and technical resources for collaborative matching, helping small and medium-sized enterprises break through their own developmental constraints. On the other hand, China itself possesses a massive domestic demand market. With the continuous increase in internet penetration, the scale of China’s netizen population continues to expand, providing a huge demand market for digital products and services. The informational advantages of the digital economy can also maximize the potential of internal demand, break through obstacles in the circulation of industry and capital, reduce the cost of matching supply and demand, and promote an equilibrium between the two.
For domestic and international connectivity, the digital economy, with its inherent advantages, not only helps bridge the ruptures in global industrial and supply chains caused by the epidemic but also extends the boundaries of economic operation. On the one hand, digital technology encourages global supply chains to upgrade toward intelligence, promoting a smoother flow of factors and resources on a global scale and fostering win-win collaboration between countries. Simultaneously, the upgrading of digital technology promotes the flow and sharing of innovation achievements among all countries, driving the elevation of China's industrial innovation capacity and accelerating the transformation of traditional industrial models to follow the path of high-quality development. On the other hand, digital trade has gradually developed as a new form of trade. Services such as online offices and distance education, which rose during the epidemic, have crossed national borders to become new business formats for commercial communication between nations. As a common trend in global economic development, the digital economy facilitates the coordination of supply and demand among various market entities in global value chains, serving as the kinetic support for domestic and international dual circulation to reinforce each other.
3. Digital Economy Development Takes the Five New Development Concepts as Its Ideological Guide
The digital economy is an economic form that holds a key position in the process of high-quality development. Xi Jinping’s vision for the development of the digital economy is guided by the Five New Development Concepts [7], adhering to scientific development and long-term planning. Xi Jinping emphasized: “China attaches great importance to the development of the digital economy. Under the guidance of the New Development Concepts of innovation, coordination, green development, openness, and sharing, China is actively promoting digital industrialization and industrial digitalization, guiding the deep integration of the digital economy and the real economy, and promoting high-quality economic development.”
The digital economy is itself an economic form where innovation factors cluster, and innovation is the primary motive force driving digital economy development. The digital economy is a new economic form driven by digital technology, centered on data elements, and carried by modern information platforms; it possesses a powerful "innovation gene" by its very nature. “The high innovativeness, strong permeability, and wide coverage of the digital economy are not only new points of economic growth but also represent the opportunity to transform and elevate industrial change.” At the same time, technological innovation and factor innovation are the main engines driving digital economy development. Only by seizing the "ox's nose" [8] of core digital technology innovation can the digital economy enter the "fast lane" of development.
The internal logic of digital economy development also echoes the four concepts of coordination, green development, openness, and sharing. A key issue in digital economy development is the combination of the digital economy with the real economy—that is, the coordinated development of digital industrialization and industrial digitalization. Digital industrialization creates new business formats and promotes the development of emerging industries such as big data and cloud computing; industrial digitalization applies digital technology to traditional industries to increase industrial value-added. Their coordinated advancement will jointly promote the steady development of the digital economy. Furthermore, the transmission of data elements can effectively break down barriers to information communication, providing the kinetic energy to promote coordinated development across regions and industries.
The low-carbon attributes inherent in the digital economy echo the concept of green development; meanwhile, digital technology empowering high-energy-consuming industries is also one of the paths to green development. The recycling and turnover characteristics of data elements avoid the depletion associated with traditional factors during use, embodying a green and low-carbon production method. At the same time, the combination of the digital economy with traditional energy industries is an effective path to encourage them to follow a sustainable development trajectory. Digital technology can facilitate intelligent upgrading and transformation in all links of the energy industry, such as production and transportation, aiding the construction of smart energy and achieving low-carbon development in the energy sector.
The digital economy grew and developed by relying on internet information technology; openness and sharing are its inherent attributes. During the 14th Five-Year Plan period, greater emphasis is placed on the inclusive and shared characteristics of the digital economy, using digital technology to increase the level of universal access to limited resources and relying on information-sharing platforms to solve the practical needs of enterprises and individuals and break down digital barriers. The current flourishing development of mobile payments and the sharing economy in China is a vivid manifestation of the concept of sharing in the field of the digital economy. Furthermore, openness is the common trend facing world development today. Xi Jinping made it clear: “China hopes, through its own efforts, to encourage all countries to jointly board the 'express train' of internet and digital economy development. China's door to the outside world will not close; it will only open wider and wider.” We must “promote the integration and open sharing of data resources, ensure data security, accelerate the construction of a Digital China, and better serve the development of China’s economy and society and the improvement of the people’s lives.”
III. The Core Essence of Xi Jinping’s Important Expositions on Digital Economy Development
The "14th Five-Year Plan for Digital Economy Development" issued by the State Council in December 2021 provided a definition of the digital economy: “The digital economy is the major economic form following the agricultural and industrial economies. It takes data resources as its key factor, modern information networks as its primary carrier, and the integrated application of information and communication technology and the total-factor digital transformation as its important driving forces, serving as a new economic form that promotes a more unified balance between equity and efficiency.” Driven by the continuous upgrading of information technology, not only is the industrialization of the digital economy itself advancing, but digital technology is also accelerating its integration with the real economy. Xi Jinping's developmental thinking on the digital economy consists of three parts: digital industrialization, industrial digitalization, and the digitalization of the governance system. Xi Jinping's vision for digital economy development is a guide to action distilled from concrete practice and continuously refined as practice evolves.
1. Digital Industrialization
Digital industrialization is one of the important aspects of the deep integration of digital technology with economic and social development, mainly comprising electronic information manufacturing, software and information technology services, and the internet industry. Xi Jinping pointed out: “If technology is to develop, it must be used,” and “scientific research and the economy cannot be treated as 'two separate skins' [9]; we must focus on promoting the transformation and industrialization of core technological achievements.” With its innovative and intelligent characteristics, the digital economy breaks through many limitations of traditional industries and can better meet people’s production and living needs; it is an emerging industry that conforms to future developmental trends. Continuing to arrange layouts around cutting-edge industries such as new-generation high-end equipment, new energy vehicles, and new materials, increasing the intensity of smart technology applications and data development, and expanding the digital economy are developmental priorities of the 14th Five-Year Plan period.
In recent years, innovative practices in China’s digital economy—such as online shopping, mobile payments, and the sharing economy—are gradually changing people's lifestyles and driving the digital transformation of the entire society. Especially under the severe circumstances of the global epidemic, the digital economy used the internet and other media to break through traditional economic models, providing online solutions for people’s work, study, consumption, and entertainment needs. Online office software and live-streamed classrooms reduced the risk of contact during the epidemic and provided key technical support for overcoming the difficulties of resuming work and production. The 2020 Government Work Report specifically mentioned: “New business formats such as e-commerce, online shopping, and online services played an important role in the fight against the epidemic. We must continue to issue supportive policies, comprehensively promote 'Internet +,' and create new advantages for the digital economy.”
The scale of China’s digital industrialization shows a trend of continuous expansion. In 2020, the value-added of core digital economy industries accounted for 7.8% of GDP. However, it should also be noted that current digital industrialization in China still faces problems such as the difficulty of transforming core scientific and technological achievements and the mismatch between market supply and demand. On one hand, China’s enterprises, research institutes, and higher education institutions operate under their respective duties and separate management, lacking unified planning. Naturally, this leads to a mismatch between scientific research results and corporate needs, resulting in a low maturity of research achievements and high difficulty in transformation. On the other hand, the development of existing digital industries is still in an immature stage; there is still a gap between industrial development and market demand. The development of the digital industry lacks forward-looking unified planning, and some industrial entities one-sidedly pursue innovation while ignoring industry norms, giving rise to industrial chaos. To achieve sustainable development, digital industries still require the government to increase regulatory efforts and strengthen policy guidance.
The "14th Five-Year Plan for Digital Economy Development" set the industrial development goal of the value-added of core digital economy industries reaching 10% of GDP. Currently, there is still a certain gap in the development of China’s digital industrialization. In the future, we should strengthen overall coordination and guide the standardized and sustainable development of digital industries.
2. Industrial Digitalization
Industrial digitalization refers to digital technology empowering traditional industries, including new integrated industrial models such as the Industrial Internet, smart manufacturing, and the Internet of Vehicles (IoV). Xi Jinping pointed out that we must “promote the deep integration of the internet and the real economy, accelerate the digitalization and intelligentization of traditional industries, make the digital economy bigger and stronger, and expand new space for economic development.”
The scale of industrial digitalization as a proportion of the digital economy in China continues to increase, gradually becoming the main engine of digital economy development. In 2020, the scale of China’s industrial digitalization reached 31.7 trillion yuan, accounting for 80.9% of the digital economy and 31.2% of GDP. The proportion of the digital economy in the value-added of the agriculture, industry, and service sectors reached 8.9%, 21%, and 40.7%, respectively. During the 13th Five-Year Plan period, the results of China’s industrial digital transformation were evident, with all three major sectors making significant progress. The "14th Five-Year Plan for Digital Economy Development" proposed to comprehensively deepen the digital transformation of key industries and made deployments for the digital development of all three sectors.
As the foundation for economic and social development, the stability of the agricultural base is linked to major national strategic needs. The modern development of agriculture must rely on progress in agricultural science and technology to keep pace with the times. At present, the proportion of China’s agricultural digitalization within the industry's added value is significantly lower than that of the secondary and tertiary industries, indicating that there is still substantial room for the development of agricultural digitalization in our country. We should fully utilize digital technologies to improve the level of digitalization in various links such as the production, processing, and sales of agricultural products. Simultaneously, we must organically integrate agricultural digitalization with the construction of the "digital countryside," ensuring that agriculture, rural areas, and farmers all enjoy the developmental dividends of the digital economy era. As pointed out in the 2022 Central No. 1 Document [10], we must "vigorously promote the construction of the digital countryside. Promote the development of smart agriculture, and facilitate the integrated application of information technology with agricultural machinery and agronomy. Strengthen training in digital literacy and skills for farmers. Focus on solving practical problems and expand application scenarios for big data in agriculture and rural areas."
Industrialization is the core of modernization, and its digital transformation is a "key move" [11] for grasping the pulse of innovation and achieving breakthroughs. Xi Jinping has pointed out, "We must continue to write the great chapter of the deep integration of informatization and industrialization, and promote the accelerated development of manufacturing toward becoming digital, networked, and intelligent." We should seize the advantage of China possessing the world's most complete industrial system to create digital empowerment platforms that connect upstream and downstream enterprises. This will facilitate the sharing of technology and resources across industrial chains, solve the difficulties SMEs face in digital transformation, and promote collaborative innovation. At the same time, we should create digital demonstration enterprises, promote the use of artificial intelligence in the production sphere, and leverage the advantages of intelligent technology to transform and upgrade original production processes, piloting the construction of intelligent production lines and smart workshops. The state should accelerate the establishment of standards for intelligent manufacturing, grasp the latest trends, create a comprehensive standard system, and encourage industrial enterprises to follow a standardized path of digital transformation and development.
Contrasting the proportion of the digital economy in the added value of the three major industries, the service sector leads in industrial digital integration. Compared to the primary and secondary industries, the service sector has the best degree of integration with the digital economy and the fastest development speed. Since 2020, the spread of the COVID-19 pandemic has forced the pace of digital transformation in the service industry. In the field of consumer shopping, e-commerce platforms such as Taobao have adopted the form of livestreaming sales to promote goods, setting off a "livestreaming sales craze" that meets people's needs to purchase goods without leaving their homes. In the field of logistics and distribution, platforms like Meituan and JD.com have developed contactless delivery services; express parcels, vegetables, and fresh produce can all achieve contactless delivery through intelligent storage lockers and other means. In the field of offline showroom sales, industries such as automobiles and home furnishings have utilized electronic information platforms to develop new forms such as "online cloud showrooms," breaking through the limitations of previous offline experiences. The integration of digital technology and the real economy played an important role in fighting the pandemic and restoring production and life; it is also a consistent development trend for the digital economy for some time to come. During the 14th Five-Year Plan period, the digital transformation of the service industry should focus on areas such as commerce, finance, and logistics. It should start from the demand side, attend to the diversified needs of service recipients, optimize service models, and improve service quality. The two major fields of market-based services and public services should emphasize coordinated development, focusing on people's needs to create a multi-dimensional supporting digital service ecosystem, fully reflecting the "people-centeredness" of digital economy development.
It must be recognized that China's industrial digital transformation currently still faces some practical obstacles. First, the cost of digital transformation for enterprises is high, which is more prominent for SMEs. It is not that some enterprises lack the will to transform, but rather that digital tools and technologies are currently at a stage of high entry barriers and large investment requirements. Due to the market's lack of mature and highly convenient digital tools, if the vast number of SMEs are to achieve transformation, they need to invest capital in underlying technology development in the early stages, which is a major obstacle to transformation. Second, there is a misunderstanding among enterprises during transformation of focusing excessively on technical upgrades. The combination of digitalization with traditional industries is intended to save costs and improve efficiency, which also echoes the requirements of China's current stage of high-quality development. However, technology is always a means, not an end. Some traditional enterprises have not focused on the connection between technology and their own business when transforming, ignoring the synergy of the entire value chain. This leads to a situation where a singular technological layout not only fails to create greater value but instead increases enterprise costs.
Industrial digitalization is a key link in the integrated development of the digital economy and the real economy during the 14th Five-Year Plan period. We should proceed from the concrete realities of enterprise development, focus on the actual empowerment of industrial chains by technology, and simultaneously improve the level and maturity of digital technology to better serve the optimization and upgrading of the industrial structure.
3. Digital Governance
Xi Jinping has long had insight into the role of informatization and digital technology in empowering government governance. In 2016, Xi Jinping pointed out, "Information is an important basis for national governance; we must leverage its important role in this process. We must use informatization to promote the modernization of the national governance system and governance capacity." Regarding the changes in social governance models in the information age, Xi Jinping has deep insights, noting that "the social governance model is shifting from one-way management to two-way interaction, from offline to the integration of online and offline, and from pure government regulation to focusing more on social collaborative governance." Digital governance refers to applying digital technology to the field of social governance and providing digital public services to the public. Currently, China's digital governance is facing new situations and tasks. On the one hand is the digital transformation of the objects of governance. With the continuous upgrading of information technology, individuals and enterprises are gradually forming electronic footprints in social life. Under the special circumstances of the COVID-19 pandemic, the penetration of information technology into individual lives became even deeper. The emergence of "Health Kit" [12] and electronic certificates has effectively facilitated individual life, forming a virtuous cycle of development. The digital transformation of the objects of governance thus forces the digital transformation of government and social governance, seeking benign interaction between various social subjects. On the other hand is the digital character of governance scenarios. With the popularization of the Internet, governance scenarios have undergone tremendous changes compared to the previous single offline model. In the era of Big Data and the Internet of Everything (IoE), online and offline spheres show a trend of deep integration, and the complexity of governance scenarios places higher demands on the modernization of governance capacity. The development of the age of self-media [13] means that connections between individuals are no longer point-to-point but have formed a connected network, which brings convenience in communication while also presenting new tests for regulation.
At present, compared with the integration of the digital economy and physical industry, China's digital governance is still in a relatively lagging stage. Specifically, first, there is an imbalance in the advancement of digital governance. There are gaps in the promotion and application of digital technology in the field of social governance across different provinces and departments. Because a unified national integrated e-government system has not yet been formed, China's digital governance is currently in a phase where various departments and regions are exploring and improving individually, and some grassroots management departments still have blind spots in digital governance. Second, the various subjects of social governance have not yet established effective communication mechanisms. In the process of digital application, enterprises often move faster than the government, which creates digital barriers for government management of enterprises. Meanwhile, there are also gaps in the promotion of digital governance between different levels within the government, lacking effective coordination mechanisms for the digital era. The shortcomings in the government's emergency management coordination were exposed in the early stages of pandemic prevention and control. Third, a data synergy and sharing mechanism has not yet been formed. The innovation of the governance system requires breaking "data islands" and reducing the cost of digital flow. Currently, institutional and mechanistic obstacles to data sharing across all industries and fields in China still exist, and a national integrated data center has not yet been formed.
The digital transformation of the national governance system is an important "handhold" [14] for bridging the "digital divide" in the New Era and is the most direct window for technology to achieve the goal of serving the people. During the 14th Five-Year Plan period, we should uphold Xi Jinping's thought on digital governance, strengthen the application of technological innovation in the field of governance, adapt to new trends in digital social development, and improve the government's governance capacity and level.
IV. The Practical Path for Digital Economy Development
In the new stage of development, Xi Jinping has proposed that "we must continuously strengthen, optimize, and expand our country's digital economy." We should coordinate the two overall situations—domestic and international—and improve the strength of China's digital economy development from the two aspects of tackling key core technologies and optimizing and upgrading digital infrastructure, while also paying attention to security issues in the digital economy field to ensure its continuous, stable, and healthy development.
1. Strengthening the Tackling of Key Core Technologies
Xi Jinping considers core technology to be a "heavy weapon of the state" [15] and attaches great importance to breakthroughs in core technology. International competition in the field of digital economy is, in essence, a competition of core technologies. To truly grasp the initiative in development, it is necessary to gain the upper hand in the field of core technologies. Network information technology, which is profoundly changing the global landscape, is also the focus of economic development and technological innovation for all countries. The horizontal innovation of digital technology itself and its integrated innovation with numerous application scenarios is an inevitable trend in digital economy development.
However, the current lack of innovative capacity in the field of core technologies and the strong dependence of industrial and supply chains remain key "strangleholds" [16] constraining the development of China's digital economy. Of particular concern is the chip security issue China has faced in recent years. As the cornerstone of the digital economy era, chip technology undoubtedly profoundly affects the development of the electronic information industry. With the intensification of China-US competition, the United States has violated the principles of fair competition, increased restrictions on Chinese chip imports, and attempted to control the global chip supply chain, seriously jeopardizing the normal development of Chinese enterprises. The U.S. containment of China's chip industry fully exposes the "bottleneck" [17] problems China faces. Therefore, Xi Jinping emphasized that "we must lead by the 'ox's nose' [18] of independent innovation in digital key core technologies" and "firmly grasp the right to develop the digital economy in our own hands."
To strengthen innovation in digital key core technologies, first, we must strengthen basic research in digital technology. As a technology-intensive industry, the development of the digital economy will place higher demands on the upgrading of communication technology. We should maintain stable support from central fiscal funds for basic research in the field of digital technology, carry out targeted basic research in key areas such as high-frequency devices and photoelectric sensors, and strengthen the sharing of results in basic research. We must emphasize education and plan for long-term development, fully leveraging the role of universities as the main battlefield for original innovation, increasing the proportion of basic theoretical teaching and research, and cultivating a reserve of talent with innovative capabilities. We should promote the integration of basic research and applied research, adapt to the situation where new forms of the digital economy are constantly emerging in the Internet era, promote the connecting of basic research, applied research, and industrialization, and facilitate the transformation of basic research results and incentivize the employment of research talent from the demand side.
Second, we must enhance the technological innovation capabilities of enterprises. Enterprises are the final end of the entire scientific research chain; we should emphasize their leading position in the innovation process and highlight the market-oriented nature of digital economy development. In this regard, we can start with substantive inclusive policies such as increasing the additional tax deduction for enterprise R&D expenses and implementing tax preference policies for enterprises in high-tech fields to stimulate enterprise innovation vitality. We should promote synergy among various subjects in the digital economy field, establish collaborative innovation centers involving institutions of higher learning, scientific research institutes, and upstream and downstream enterprises in the industry, and promote the stabilization and maturation of market transformation mechanisms for scientific research achievements. We should gradually create shared technology platforms, led by large enterprises, to provide common basic technological achievements for SMEs and promote integrated innovation across the entire industrial chain.
2. Optimizing and Upgrading Digital Infrastructure
When planning the strategy for building a Digital China, Xi Jinping has mentioned multiple times the need to "accelerate the improvement of digital infrastructure and promote the integration and open sharing of data resources." The 2022 Government Work Report also mentioned "building digital information infrastructure, gradually constructing a national integrated big data center system, and promoting the large-scale application of 5G." In the period of digital transformation, optimizing and upgrading digital infrastructure is the primary and critical link.
To this end, first, we must construct information network infrastructure with forward-looking thinking. Comprehensive digital information infrastructure is an extremely important developmental prerequisite for the digital economy. We should coordinately promote the construction of gigabit fiber networks and 5G network infrastructure. We should further expand the commercial scope of 5G, plan the construction of emerging satellite communication networks, and plan ahead for the research and development of components required for the development of 6G technology, providing hardware infrastructure support for the continuous development of the digital economy industry. At the same time, we should promote the intelligent transformation of infrastructure and production equipment in various traditional industries to facilitate the elastic supply of manufacturing resources. We should accelerate the construction of industrial Internet infrastructure configurations and, surrounding the needs of industry, academia, and research, build digital transformation alliances and innovation networks.
Second, promote the interconnectivity of various infrastructures. At the Central Economic Work Conference [19] in late 2018, it was proposed to "strengthen the construction of new types of infrastructure such as artificial intelligence, the Industrial Internet, and the Internet of Things." Various types of information infrastructure, such as regional communications and satellite navigation, should further achieve interconnectivity to gradually expand high-speed internet access at low cost and promote information sharing and cooperation in key fields. Simultaneously, international interconnectivity in the field of the digital economy should be expanded; the pioneering practice of "Belt and Road" countries jointly building a space information corridor serves as a successful example. We should rely on regional cooperation agreements, focus on the digital economy development needs of various countries, and achieve a multi-win scenario in the infrastructure field through interconnectivity.
Third, synergistically promote the sustainable development of digital infrastructure construction. In the era of the digital economy, infrastructure construction is an engineering project involving multiple subjects such as government departments, enterprises, and social individuals. We should grasp the innovative and frontier nature of digital infrastructure construction and ensure good top-level design [20] and national layout for such construction. The government should strengthen inter-departmental coordination to avoid repetitive, low-level construction, while simultaneously formulating policies and regulations to maintain the achievements of digital infrastructure construction, strengthen facility protection, and ensure the smooth advancement of the digital economy. The purpose of infrastructure construction is to provide support for the development of digital enterprises; therefore, government departments should take enterprise needs as the guiding principle for digital infrastructure construction, strengthen linkages with enterprises, understand their genuine needs, and effectively provide the developmental value of infrastructure. Additionally, market entities should be introduced into the construction of digital infrastructure by lowering entry barriers, attracting social capital and enterprises into "digital new infrastructure" [21], encouraging credit support plans for new infrastructure and the development of REITs pilot programs, and promoting the participation of diverse subjects.
3. Regulating the Development of the Digital Economy
With the continuous development of information and network technologies, the application scenarios of the digital economy are constantly expanding. The security issues facing digital economic development are no longer limited to network security; as technology expands, they will face more complex challenges such as big data security and cloud computing security. Simultaneously, the close integration of the digital economy with the real economy also means the transmission of risks. Strengthening the construction of a digital economy security system is a vital link in preventing risks from spreading through the macroeconomic system and enhancing the stability of the economic system. Xi Jinping emphasized, "We must regulate the development of the digital economy, persisting in the 'grasping with both hands' approach—both promoting development and regulating supervision—ensuring both hands are equally firm; regulating within development and developing within regulation." To this end, the "14th Five-Year Plan for Digital Economy Development" has also proposed specific practical paths.
First, enhance protection capabilities for network and data security. We must improve the technical level of network risk prevention and continuously increase safety coefficients for networks and data. We must improve and perfect emergency warning and notification mechanisms for network security, regulate data security life-cycle management, and establish data security firewalls. From the perspective of hardware facilities, we must block risks that threaten national network and data security. We must strengthen the construction of a data security standard system, raise entry thresholds, and prevent the intrusion of risk factors.
Second, strengthen supervision efforts in the field of the digital economy. As an emerging field of development, the digital economy industry’s high degree of innovation also brings the risk of regulatory lag. To this end, we must first strengthen the tracking and updating of laws and regulations, clarify the responsibilities and obligations of various subjects in the industry, and prevent "disorderly expansion" [22]. Second, we must reinforce the establishment of a comprehensive and multi-layered supervisory system, construct a regulatory governance framework of dynamic balance, and strengthen top-level design for regulatory systems encompassing industries and platforms. Finally, we must improve the fairness of industrial competition, strictly crack down on monopolies and other unfair competition behaviors, protect the privacy of citizens, and severely punish acts that break regulatory "red lines," guiding economic subjects toward legal and compliant operations.
Third, raise the security awareness of the masses. The volume of data and the breadth of coverage faced in the era of informatization and digitalization are unimaginable compared to previous eras. While the era of "we-media" [23] brings an infinite incremental increase in data, it also greatly enhances the freedom of individuals to disseminate information. At the same time, the digital economy is a field where new technologies and new business forms constantly emerge; the profit-seeking nature of social capital can lead to investment phenomena such as blindly following trends and homogenous competition. To this end, the government should play its role in strengthening regulation and guidance at the social level, regulating network behavior under the premise of guaranteeing the people's freedom of speech, and purifying the cyberspace.
4. Fully Leveraging the Role of Data as a Factor of Production
Data is a key productive factor in the era of the digital economy. The Fourth Plenary Session of the 19th CPC Central Committee listed data alongside traditional factors such as labor, capital, technology, and land, highlighting the important role of data in the New Era. The sustained development of the digital economy is inseparable from the high-quality supply and market-based circulation of data.
To this end, first, we must improve the supply quality of data factors. Currently, China has not yet formed unified standards and norms for data collection and processing, and professional capacity for data processing is still lacking. We should face the specific requirements of data demanders such as enterprises and governments, improve data cleaning and analysis capabilities, and enhance data management capabilities to avoid chaos in production and social governance caused by uneven quality of data factors.
Second, we must cultivate and form a market for data factors. For data factors to play their role, they must rely on a mature data circulation environment. Currently, China has not yet formed a unified data factor market, and due to the special attributes of data, it is difficult to price data according to a single standard, making large-scale trading behavior difficult to carry out. In the future, various market participants should be encouraged to explore data asset pricing models, gradually regulate data transactions, and cultivate a supporting market operation system for data factor circulation. Simultaneously, we should improve the income distribution mechanism where the value of data factors is matched with their contribution, thereby mobilizing the initiative of market entities.
Third, we must strengthen the development level of data factors. We should give full play to the role of various market entities in mining and developing data resources, tapping into "dormant data." We should promote the integration of data with various application scenarios, develop the commercial value of data, and promote the transformation of its value into products and services to meet the personalized needs of market participants. During the development process, attention should be paid to the protection of user data privacy to ensure the sustainable development of data factor utilization.
5. Strengthening International Cooperation in the Field of the Digital Economy
Currently, facing the opportunities of digital development, countries around the world are planning their layouts for digital economic development. The mobility and shareability inherent in data factors mean that cooperation is the correct path for future development. All countries need to uphold an open attitude, strengthen cooperation and sharing in technical resources, and jointly respond to the new opportunities and challenges of the digital era. China should combine the strategic requirements of the "new development pattern" [24] to promote the linkage between domestic and international dimensions and actively participate in international cooperation in the digital economy.
To this end, first, we must perfect the interconnected network. Relying on the Belt and Road Initiative and the RCEP, China drives the interconnectivity of surrounding countries and regions. In May 2017, Xi Jinping first proposed the concept of the "Digital Silk Road," calling on countries worldwide to "persist in innovation-driven development, strengthen cooperation in frontier fields such as the digital economy, artificial intelligence, nanotechnology, and quantum computing, and connect them into the Digital Silk Road of the 21st century." Under the guidance of this initiative, cooperation among countries along the "Digital Silk Road" has yielded fruitful results, building an interconnected information network and promoting inclusive and linked development. In the future, we should further rely on regional cooperation agreements to actively carry out international cooperation in infrastructure and core technologies of the digital economy to improve the degree of sharing.
Second, drive international cooperation in the digital economy through the development of digital trade. Digital trade is the product of digital information technology empowering the field of international trade, and it is also the current digital solution to break through trade difficulties under the pandemic. We should further refine relevant supporting policies in the field of digital trade, improve institutional and legal guarantees, and create a favorable environment for trade digitalization. Relying on experimental bases such as Free Trade Zones and Free Trade Ports, we should create a trade environment that facilitates cross-border payments and logistics, introduce international digital innovation resources, and cultivate cross-border industrial chains in the digital economy. We should encourage export enterprises to enter the field of digital trade, make full use of the convenience created by data flow and sharing, and promote the digital transformation of R&D, production, management, and sales to explore new forms of digital trade.
Third, maintain and improve multilateral digital economy governance mechanisms. Forming digital economy governance standards and rules generally recognized by all countries is significant for building a harmonious and orderly cyberspace and promoting the sustainable development of the digital economy. China should take the initiative, actively participate in international negotiations in the digital economy, jointly formulate a scientific and reasonable digital economy governance system, and contribute "China's voice" to the perfection of multilateral digital economy governance mechanisms. We should strengthen inter-governmental policy dialogue on digital economy development and technical communication and coordination between enterprises, maintain the order of the information cyberspace, and create a favorable international environment for the development of the digital economy.
(Author Biography: Chen Jiangsheng is the Vice President and Professor of the Graduate School of the Central Party School of the CPC [National Academy of Governance])