The technological transformation driven by China's large-scale equipment renewals will enable businesses to make significant strides in areas such as smart manufacturing, new energy and green technologies, further bolstering the country's economic momentum, said government officials on Tuesday.

China aims to increase its investment in equipment for manufacturing, agriculture, construction, transportation, education, culture, tourism and medical care by at least 25 percent by 2027, compared with 2023, according to an action plan released by the State Council, China's Cabinet, in March.

Complementing these efforts, the government allocated approximately 150 billion yuan ($21.31 billion) in ultra-long special treasury bonds in July to support large-scale equipment renewals, including updating old elevators.

Speaking at a news conference in Beijing, Liu Dechun, director of the department of resource conservation and environmental protection at the National Development and Reform Commission, China's top economic regulator, said as new industrialization and urbanization continue to advance, the demand for upgrading various types of equipment is surging.

Liu said that accelerating the implementation of equipment renewal initiatives will effectively promote China's industrial upgrading and foster the growth of new quality productive forces.

To drive the upgrading and renewal of energy-consuming equipment, the government will prioritize key sectors such as manufacturing, construction, transportation and energy. It will provide strong support for the modernization of high energy-consuming equipment, including boilers, motors, turbines, transformers, heat exchangers, pumps, compressors and lighting systems.

Projects that result in annual electricity savings of over 500,000 kilowatt-hours or energy savings of more than 150 metric tons of coal will qualify for support, extending benefits to more small and medium-sized enterprises, he added.

Large-scale equipment upgrade policies have notably supported investment growth. Investment in the purchase of industrial equipment and tools soared by 16.8 percent year-on-year in the first eight months of 2024, data from the NDRC showed.

This is 13.4 percentage points higher than the growth of total investment in China, accounting for 64.2 percent of the contribution to the nation's overall investment growth, according to the commission.

Zhang Jianhua, deputy director of the department of planning at the Ministry of Industry and Information Technology, said that equipment renewal and technological transformation in the industrial sector are beneficial for expanding effective investment and increasing the proportion of advanced production capacity, offering both short- and long-term advantages.

The MIIT will encourage industrial companies to seize the opportunity provided by national policies supporting large-scale equipment renewals to carry out initiatives including upgrading advanced equipment, promoting digital transformation and advancing green equipment.

This will accelerate the renewal and transformation of production equipment and speed up industrial upgrading, said Zhang.

China's centrally administered State-owned enterprises will also invest over 3 trillion yuan for large-scale equipment upgrades over the next five years, aiming to stay at the forefront of the latest technological and industrial advancements, the State-owned Assets Supervision and Administration Commission of the State Council announced in late July.

Chen Jianwei, a researcher at the Beijing-based University of International Business and Economics' Academy of China Open Economy Studies, said these moves will help attract both multinational corporations and domestic companies from the private sector to increase their investments in these fields in China.

"They are likely to increase spending on promoting technological innovation, green and sustainable development, digital transformation and the circular economy within the country," said Chen.

"We are confident of our development in China, which is the world's largest elevator equipment market. We remain committed to supporting urbanization, smart cities, large-scale equipment renewals and sustainable development in the country," said Sally Loh, president for China at Otis Worldwide Corp, a United States-based elevator manufacturer.