China’s industrial economy maintains steady growth amid advances in innovation and digital infrastructure

A press briefing hosted by the State Council Information Office on 20 July outlined China’s industrial and information technology performance for the first six months of 2026. Officials from the Ministry of Industry and Information Technology (MIIT) confirmed overall stable industrial momentum, strengthened innovation capacity and continuous industrial restructuring, with robust progress seen in equipment manufacturing, pharmaceuticals, electronic information manufacturing and next-generation communication and computing infrastructure.

Industrial output registered steady expansion across the first half of the year. Value-added industrial output of enterprises above designated size rose by 5.4 per cent year on year, and industry contributed more than 35 per cent to national economic growth. Corporate profitability improved markedly; total profits of large industrial enterprises increased by 18.8 per cent in the first five months. Goods exports, denominated in renminbi, climbed 13.4 per cent over the first six months. The digital sector maintained rapid expansion, posting operating revenue of 16.7 trillion yuan in the first five months, a 13 per cent year-on-year rise, alongside an 19.3 per cent increase in aggregate profits. The production sub-index within the manufacturing Purchasing Managers’ Index has remained in expansion territory for four consecutive months.

Equipment manufacturing acts as a core stabiliser for industrial activity. Its value-added output grew 6.4 per cent year on year in the first half of 2026, accounting for 20 per cent of total large-scale industrial output and contributing 23.5 per cent to overall industrial growth. Production volumes of industrial robots and service robots increased by 28 per cent and 11.9 per cent respectively. The sector has become the primary driver of export expansion; export delivery values for equipment manufacturers advanced 18.2 per cent, responsible for nearly half of all industrial export growth. Wind turbine and lithium battery shipments rose 35.6 per cent and 37.6 per cent year on year. Finished vehicle exports hit 5.096 million units, up 65.3 per cent. Exported vessels make up more than 90 per cent of the country’s shipbuilding completions, new orders and order backlogs, reflecting rising global competitiveness.

The pharmaceutical industry delivered notable results. Value-added output from large-scale pharmaceutical manufacturers rose by 6.4 per cent in the first six months, with biological products recording double-digit growth and acting as a key growth engine. Thirty-eight innovative medicines received market approval, of which 31 were domestically developed, representing over 80 per cent of approvals. Outbound technology licensing deals for innovative drugs generated transaction volumes exceeding 100 billion US dollars in the first half of the year, demonstrating systematic improvements in innovation quality across the domestic pharmaceutical sector.

Electronic information manufacturing achieved double-digit growth in both value-added output and operating revenue. A host of artificial intelligence terminal manufacturers have rolled out consumer hardware including AI musical instruments, smart cameras and AI headsets, supported by flexible market mechanisms and comprehensive industrial supply chains. Intelligent AI devices are gradually entering commercial workspaces and smart households; AI personal computers, televisions and smart speakers are evolving from standalone gadgets into proactive service providers.

Progress in artificial intelligence relies on robust digital infrastructure. By the end of June, China operated 5.102 million 5G base stations, with active commercial rollout of 5G-Advanced networks under way. National intelligent computing capacity reached 2,185 EFLOPS, an increase of 177 per cent year on year.

MIIT is conducting research into the development of next-generation communication networks, following national plans to build six key digital networks. The new network framework extends connectivity beyond individual users to humans, machines, physical equipment and embodied intelligence, delivers seamless air-space-ground-sea coverage, offers greatly enhanced reliability and deterministic performance, and integrates communication, sensing, computing, artificial intelligence and security capabilities, instead of merely transmitting data. Work will continue to develop foundational, space-based, international and converged communications networks, supporting large-scale commercial deployment of 5G-Advanced and 10-gigabit fibre broadband. Research efforts will target breakthroughs in 6G communications, ultra-high-speed optical transmission, submarine cables and satellite communications. Authorities will deepen industrial applications for 5G and gigabit fibre, and advance integrated development linking brain-computer interfaces, embodied intelligence and intelligent connected vehicles with 5G-Advanced, 6G and satellite internet systems.

National computing infrastructure recorded an overall server utilisation rate of 71.4 per cent. More than 70 dedicated computing transmission corridors have been constructed around national computing hubs over the past two years, lifting inter-node network performance by 10 per cent. In response to mounting demand for intelligent computing resources, MIIT will optimise the layout of computing facilities following a structured framework covering nodes, transmission links, networks and regional coverage. Plans include developing intelligent computing clusters, advancing coordinated power and computing resource management, issuing guidance standards for computing architecture, rolling out city-level low-latency computing initiatives and launching targeted schemes to make affordable computing accessible to small and medium-sized enterprises.

Emerging and future-focused industries are gaining global traction. Domestic quadruped robots account for nearly 70 per cent of worldwide sales, while more than 400 humanoid robot models developed in China represent over half of global available products. Shipbuilding secured 81.2 per cent of new global orders between January and May, retaining the leading market position.

MIIT has introduced targeted policies for multiple future-industry tracks, with further regulatory documents currently being drafted. More than 85 provincial-level pilot zones for future industries have been established across different regions. The bio-manufacturing sector boasts an annual output value of approximately 1.1 trillion yuan, with domestic fermentation product output exceeding 70 per cent of global volumes. The world’s first invasive brain-computer interface product has obtained market clearance. Embodied intelligence hardware is undergoing rapid iteration; over 230 enterprises have launched more than 400 complete robot models, with annual shipments projected to surpass 100,000 units.

Officials outlined three priority areas to streamline industrialisation of scientific and technological achievements, in response to questions from China Securities Journal reporters.

Authorities aim to strengthen incubation ecosystems, creating end-to-end services covering research, pilot testing and enterprise nurturing. More than 425,000 enterprises and teams are currently hosted within domestic incubators, and one-third of STAR Market listed companies emerged from incubation programmes. Several well-known technology firms based in Hangzhou have grown from these incubator environments.

Work proceeds on developing a unified national technology trading marketplace. MIIT is finalising policy documents to foster integrated technology transactions and building a national centralised technology trading platform. The hub will deliver full-spectrum services including equity registration, valuation, demand matching, settlement and contract filing, enabling mutually recognised registration and nationwide trading.

Stakeholders will smooth links connecting technology supply and industrial demand. The framework encourages industrial sectors to identify practical challenges for researchers to address, supported by professional technology managers. MIIT is drafting reforms and formal standards governing technology managers, which are due for release in the near future. Coordination between incubation networks, national trading platforms and supply-demand matching mechanisms will be reinforced. Regulators will promote standards for technology service maturity, expand pilot schemes for “use first, pay later” licensing, and leverage the unified national trading platform to build a fully integrated technology market that delivers innovation dividends to businesses of all sizes.