An illustration of using AI applications on a mobile phone. Photo: VCG

Themk integration of scientific and technological innovation with finance has become a hot topic during this year's two sessions, with the concept of patient capital thrust under the spotlight. The enthusiastic discussions among lawmakers and political advisors, coupled with the message in the Government Work Report, underscore a clear shift in China toward leveraging more patient capital to bolster the development of high-tech sectors. 

In light of the profound changes in both the domestic and international economic landscapes, China recognizes that improving competitiveness in the technological marathon requires the sustained support of patient capital.

According to this year's Government Work Report, the government will refine the differentiated oversight system for venture capital funds and provide greater policy backed financial support to accelerate the development of venture capital investment and the growth of patient capital.

This sends a strong policy signal, highlighting the country's strong commitment to the development of patient capital, and indicating that, with the support of patient capital, China will advance further in the realm of high-tech development.

Patient capital, which refers to non-speculative capital that is willing to make long-term investments and assume relatively high risks, has become a buzzword in China's financial and technological circles. This form of capital, distinct from speculative investments, aligns perfectly with the developmental trajectory of scientific and technological innovation. As China transitions from an investment-driven to an innovation-driven economy, patient capital is increasingly recognized as a crucial element of sustainable growth.

The concept of patient capital has gained much attention since 2024, featuring in several key policy documents. For instance, last week, the General Office of the State Council issued guidelines on advancing key areas in the financial sector, underscoring expanding patient capital, to support the development of leading high-tech enterprises, unicorn companies and specialized small and medium-sized enterprises. 

These policies are expected to attract more social capital into venture investment and foster a robust ecosystem for cultivating innovative enterprises. For investors, this presents new market opportunities; for tech companies, it promises a more favorable development environment.

The growth of patient capital is a pivotal driving force in promoting scientific and technological innovation. The development of science and technology innovation-driven enterprises requires stable financial support and room for trial-and-error. Patient capital can provide these enterprises with capital guarantees throughout their life cycles. 

As Zhao Xiaoguang, a national political advisor and a researcher at the Institute of Automation of the Chinese Academy of Sciences, stated in a recent interview, the preparatory stage of a scientific research achievement transitioning from the laboratory to the market is the most challenging. There are numerous hurdles to overcome, and the associated risks are extremely high. Therefore, greater patient capital and a strong social consensus are needed to safeguard the interests of innovators.

The attention to patient capital also reflects China's growing ability to attract medium- and long-term investment. The success of medium- and long-term investment projects in key areas has been further enhanced, pointing to the need for support for such investment.

The push for patient capital comes at a critical juncture as protectionism rises and technological competition intensifies. Some Western countries have resorted to unilateral measures, erecting trade barriers and imposing technological blockades. These measures disrupt the global technological cooperation order and plunge their own economic development into chaos and uncertainty. However, China has not been intimidated by these external pressures. Instead, it has firmly embarked on the path of relying on its own strength, developing patient capital, and promoting scientific and technological innovation.

Rather than engaging in short-sighted trade wars or technological containment, China is focusing on long-term strategies through the development of patient capital and comprehensive technological innovation. This approach is not a temporary fix but a well-considered strategic move.

Regardless of how the external environment fluctuates, China always adheres to doing its own things well. As China steadfastly marches forward on the path of scientific and technological innovation with the support of patient capital, it strengthens its own economic resilience.