“Advanced integration can stimulate innovation and foster novel growth catalysts”

China is making strides to bolster innovation by focusing on the development of cutting-edge industries that utilize military technologies. This move is part of the country’s strategy to encourage military-civil integration, with the objective of nurturing new economic growth stimulants and enhancing the national economy. This was recently emphasized in a guideline issued by the State Council.

The guideline, which was released last week, identifies seven key tasks to further the military-civil integration in the defense technology industry. One of the primary objectives is to encourage the sharing of technological innovation resources and facilities between the military and civilian sectors. Furthermore, there will be increased efforts to apply military technologies to non-military sectors.

The focus of this integration will also be on crucial areas such as space, cyberspace, and maritime sciences. Private investment is also being encouraged in the military industry. This guideline represents the latest effort by the central government to promote military-civil integration, which involves expanding military contract orders to civilian sectors and using high-end military technologies for civilian purposes as a part of the supply-side structural reform.

In June, the State Council’s General Office issued a guideline on civil aviation development. This involved the opening up of airspace less than 3,000 meters in altitude and other sectors, such as cybersecurity and satellite navigation.

According to Shi Haiming, an associate professor at the National University of Defense Technology, the guideline brings benefits for both private and military enterprises. It aims to adjust pre-entry approvals to post-entry reviews to simplify administration, apart from strategic weapons. Shi also mentioned that the guideline reduces the entry barrier for enterprises into the weaponry equipment field, making the process more transparent.

The guideline will also help lower institutional costs for private enterprise by building better platforms to promote military-civil integration. As Shi noted, military-civil integration is a common practice in many developed economies.

For instance, Boeing, a U.S. airplane manufacturer, sells billions of dollars’ worth of civil aviation aircraft to China annually and is also known for its high-end military aircraft. Similarly, Japanese multinational companies like Toshiba and Mitsubishi have departments dedicated to military orders.

Jiang Luming, a professor at the National Defense University of the People’s Liberation Army, pointed out that military-civil integration is a global trend aimed at enhancing national defense capability. In countries such as the U.S., the U.K., and Germany, less than 15 percent of military technologies are strictly for military use, and over 80 percent are used for civilian purposes.

Jiang also revealed that China has approximately 290,000 national defense intellectual property rights that remain unused due to the previously separated military and civil industries. These unused technologies have the potential to stimulate economic growth and national defense.

Military companies are also being encouraged to collaborate with local governments to showcase their expertise and develop a significant number of new high-tech industries. These new industries are expected to play a crucial role in driving local economic growth and generating new employment opportunities.

Currently, 30 percent of products manufactured by China’s military companies are for military use, while the remaining 70 percent are for civilian use. In the future, high-tech industries are expected to constitute half of the military-related economy.