The central government recently issued a document aimed at promoting the updating of equipment in the industrial field, saying that by 2027, the equipment investment scale in the field will have increased by more than 25 percent compared with 2023.

It says that by 2027, the digital transformation of industrial enterprises will have been fully covered in major industrial provinces, cities and key industrial parks; production capacity below the benchmark level of energy efficiency in key industries will have been phased out; the energy efficiency of major energy-consuming equipment will have basically reached the level of energy conservation, and the application of innovative products will have accelerated.

The document sets out a series of measures to promote updating of industrial equipment as well as the digital transformation, green equipment popularization, and safety level improvement, with a total of 12 key tasks laid out. For example, it maps out the accelerated replacement of backward and inefficient equipment or old equipment, and calls for greater efforts to promote the in-depth application of new technologies such as artificial intelligence, 5G, and edge computing in manufacturing, unleashing production data connectivity, manufacturing flexibility and intelligent management, and creating a digital workshop.

At the same time, the document rolls out a number of safeguard measures to promote the upgrading of equipment in the industrial field, through increasing fiscal support for equipment renewal and technological transformation, and including eligible key projects in the scope of investment funds supported by the central budget. It will also increase preferential tax support for special equipment for energy conservation, water conservation, environmental protection, and production safety.

As an industrial power, China's total industrial added value in 2023 amounted to 39.9 trillion yuan ($5.51 trillion), accounting for 31.7 percent of GDP, and its manufacturing added value accounted for more than 30 percent of the global total, ranking first in the world for 14 consecutive years.

However, it should be noted that it is the enterprises themselves that must shoulder the responsibility for equipment updating. To promote large-scale equipment renewal, the market should play a decisive role in allocating resources, and the government only needs to play a guiding role. What the government should do is to make policy arrangements for solving the difficult points of enterprises' equipment renewal, and provide a strong guarantee for accelerating the formation of scale effects.