On September 24, during a press briefing at the State Council Information Office, Wu Qing, Chairman of the China Securities Regulatory Commission (CSRC), outlined significant measures to further strengthen China's capital markets. One of the key initiatives involves actively attracting medium and long-term capital to drive market stability and sustainable economic growth. These efforts align with China's ongoing focus on enhancing financial market functionality and supporting its economic modernization agenda.

This approach was first emphasized at the Lujiazui Forum, where Wu highlighted the importance of embracing the development of "new intelligent production" as a crucial part of China's economic transformation. Technological innovation, a key driver of new productivity, often requires high initial investments, long development cycles, and involves considerable operational uncertainty—factors that make long-term capital essential. According to Wu, such “patient capital” is well-suited for supporting innovation-driven enterprises, particularly those in the high-tech sector.

To cultivate this type of capital, the CSRC will collaborate with various stakeholders to create a more conducive environment for long-term investments. Wu noted that the Commission plans to optimize policies across the full lifecycle of venture capital and private equity, from fundraising and investment to management and exit strategies. This initiative will also focus on guiding capital toward early-stage, small-scale, and hard-tech investments, further enhancing the synergy between technology, industry, and finance. By doing so, China aims to establish a virtuous cycle where innovation fuels industrial growth, which in turn strengthens the financial system.

Experts have echoed the importance of long-term capital in fostering innovation. Wang Peng, a research fellow at the Beijing Academy of Social Sciences, emphasized that medium and long-term investments are critical to supporting technological advancements, helping China transition from traditional manufacturing to high-tech industries. Zhang Xinyuan, a lead researcher at Kefangde Think Tank, added that patient capital plays a vital role in reducing the financing costs of innovative companies, thereby promoting sustainable growth. More importantly, it enables investors to share in the high returns generated by the rapidly growing technology sector.

In addition to fostering innovation, the CSRC also plans to introduce six measures aimed at revitalizing the mergers and acquisitions market. These measures will complement broader efforts to channel capital into sectors that support China’s strategic development priorities. By focusing on M&A and long-term investments, China is positioning its capital markets to better serve the real economy while ensuring robust investor protection, particularly for smaller investors.