Li Yang Advocates for a Continuous Financing Chain in Sci-Tech Innovation

Building a Robust Innovation Ecosystem

At the recent 9th Hongqiao International Economic Forum, a session titled "Pudong and the World: Technological Innovation Driving Industrial Upgrading, Smart Integration Shaping a Shared Future" brought together influential global business leaders. The focus was on fostering international collaboration in technological innovations and promoting sustainable growth.

Li Yang, a prominent member of the Chinese Academy of Social Sciences and Chairman of the National Institute of Financial and Development, stressed the importance of establishing a continuous financing chain to bolster China’s sci-tech innovation system. He articulated the necessity for coordinated efforts to bolster innovation across various developmental stages.

The Four Stages of Sci-Tech Innovation

Li described the sci-tech innovation process as comprising four key stages: theoretical research, technology development, commercialization, and industrial application. He noted that Shanghai possesses the ideal conditions to support all these stages. “Our goal should be to systematically advance these areas,” he remarked, emphasizing three essential tasks: enhancing existing assets, promoting new growth sectors, and developing future industries.

“Revitalizing existing assets involves improving the productivity and efficiency of traditional sectors,” Li explained. He believes that advancing manufacturing processes and adopting green technologies could substantially strengthen modern manufacturing foundations.

The second priority, strengthening new growth areas, targets industries such as new energy, integrated circuits, biomedicine, artificial intelligence, and advanced materials. According to Li, these burgeoning sectors are integral to enhancing China’s position in the global economy.

Lastly, the development of future industries requires strategic investments in revolutionary fields like quantum information technology, humanoid robotics, and low-altitude economic activities. “Establishing new technologies and application scenarios will provide us with competitive advantages in the long run,” he stated.

Shanghai's Competitive Advantages

Li highlighted five distinct advantages that could elevate Shanghai into a global sci-tech innovation hub:

• Economic Strength: Shanghai has long been recognized as a vital financial center in the Far East. With a GDP reaching 5.67 trillion yuan in 2025, the city boasts a prominent population, contributing to a per capita GDP of approximately 228,000 yuan, equivalent to around $32,000.
• Urbanization Rates: With an urbanization rate of 90.2%, Shanghai continues to attract residents, which Li argues reflects the region's economic potential and growth prospects.
• Highly Educated Talent Pool: The city hosts numerous universities, with a high concentration of educated individuals—33.87 per 100 residents, according to recent census data. This environment fosters a robust base for innovation.
• Strategic National Support: Shanghai is at the heart of one of China's leading international innovation hubs—the Yangtze River Delta, benefiting from extensive governmental support.
• Comprehensive Industrial Chains: Shanghai enjoys a complete industrial ecosystem, enabling rapid translation of innovations into industrial applications for market readiness.

Enhancing Innovation Through Financial Support

Li's vision for strengthening Shanghai as a sci-tech innovation center includes empowering enterprises to take the lead in driving innovations, pursuing breakthroughs in critical technologies, and enhancing collaboration among industries, universities, and research institutions.

Li underscored the significance of finance in the innovation landscape, advocating for a continuous financing chain ranging from seed investments to venture capital, followed by bank loans and bond financing. He believes that such a structured approach is crucial for ensuring ongoing financial backing for innovative endeavors.

He also pointed out the critical need for effective risk management strategies. “Understanding risk is vital. It must be viewed as a valuable resource rather than purely a liability,” Li explained. He urged financial institutions to recognize and efficiently manage risks while developing mechanisms that create value for innovative projects.

Li concluded by reiterating that every aspect of the innovation chain, from initial research to the final production stages, requires sufficient resources and support. He emphasized that connecting these links effectively will be crucial for the advancement of China's sci-tech innovation ecosystem.