China Signals Expanded Backing for ‘Little Giant’ Firms to Strengthen Tech Independence
China has signalled a new push to strengthen its technological self sufficiency by expanding financial and policy support for small but highly innovative companies operating in specialised sectors. The move is part of a broader strategy to upgrade key industries and reduce reliance on foreign technology amid a more uncertain global economic environment.
Speaking to Xinhua, Li Lecheng, head of the Ministry of Industry and Information Technology, said central authorities are preparing a new round of fiscal support measures aimed at small and medium sized enterprises that lead in niche and strategically important fields. These companies are often referred to as China’s “little giants”, a label used for firms with strong innovation capacity, core technologies and clear competitive advantages in specialised markets.
Li said the upcoming measures are designed to reinforce enterprises as the primary drivers of technological innovation. By directing more targeted financial resources toward these firms, policymakers hope to accelerate breakthroughs in critical technologies while strengthening industrial supply chains at home. The initiative reflects Beijing’s long standing view that smaller, focused companies play a vital role in transforming laboratory research into commercially viable products.
The “little giant” programme has been a central pillar of China’s industrial policy in recent years. Companies selected under the scheme typically operate in areas such as advanced manufacturing, new materials, industrial software, high end equipment and specialised components. Many of them supply larger manufacturers and are considered essential links in sectors ranging from semiconductors to renewable energy and aerospace.
Industry observers note that while large state owned enterprises and major private technology groups often attract the most attention, smaller firms are frequently responsible for key innovations. These companies tend to be more agile, willing to invest heavily in research and development, and capable of dominating narrow but crucial segments of the market. However, they also face greater financing challenges, especially during periods of economic slowdown or tighter credit conditions.
By promising stronger fiscal backing, regulators aim to ease these pressures and encourage long term investment. Support is expected to come through a mix of direct subsidies, tax incentives, specialised funds and improved access to financing channels. Local governments are also likely to be encouraged to align their own policies with national priorities, creating a more supportive environment for innovation driven firms.
The renewed focus on technological self reliance comes as China seeks to safeguard its industrial base against external shocks. Trade frictions, export controls and supply chain disruptions in recent years have highlighted vulnerabilities in areas such as chips, precision manufacturing tools and industrial software. Strengthening domestic capabilities has therefore become a strategic priority.
Analysts say the success of the initiative will depend not only on funding levels but also on how efficiently resources are allocated. Clear standards, transparent evaluation and sustained policy support will be essential to ensure that the most capable firms benefit and that innovation leads to real industrial upgrading.
As China continues to recalibrate its growth model, the expansion of support for “little giant” companies underscores a shift toward quality driven development. Rather than relying solely on scale, policymakers are placing greater emphasis on depth, resilience and technological strength as the foundations of future economic growth.
