FINANCE

China Accelerates Sci-Tech Bond Plan to Fuel Innovation, Aiming for $40 Billion in Issuance

Published: May. 8, 2025 4:48 a.m. GMT+8

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Pan Gongsheng Photo: SCIO

China is pressing ahead with a financial reform initiative first unveiled during the March “Two Sessions” — the launch of a dedicated bond platform to support tech innovation.

Pan Gongsheng, the governor of the People’s Bank of China (PBOC), said in a policy update on Wednesday, that groundwork for the Sci-Tech Bond Board is now largely complete, with near-term issuances expected to exceed 300 billion yuan ($41.7 billion).

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China is launching the Sci-Tech Bond Board to support tech innovation, with initial bond issuances expected to exceed 300 billion yuan ($41.7 billion).
The platform offers flexible bond structures and simplified regulations, targeting sectors like AI, semiconductors, and biotech, and aims to attract institutional investors.
A new risk-sharing facility, using PBOC refinancing funds, will lower barriers for long-term tech bonds, especially for private equity issuers.

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Who’s Who

Private Equity Firms: Private equity firms have supported nearly 90% of STAR Market and 60% of ChiNext listings in China but have rarely used the bond market due to cost and maturity constraints. The new Sci-Tech Bond Board and accompanying risk-sharing facility aim to lower these barriers, making it easier and more attractive for private equity firms to issue long-term tech bonds, thus expanding their role in financing tech innovation.

Asset Managers: According to the article, China’s central bank is encouraging participation from asset managers in the new Sci-Tech Bond Board. Asset managers are among the targeted long-term institutional investors, and the policy promotes development of tech bond indexes and index-linked products to expand their access to these innovation-focused bond issuances.

Insurers: According to the article, China’s central bank is encouraging participation from long-term institutional investors, explicitly mentioning insurers. The policy aims to attract insurers to invest in technology innovation bonds through the Sci-Tech Bond Board, broadening access and channeling more capital into the tech sector.

Commercial Banks: According to the article, financial regulator Li Yunze expressed support for commercial banks to establish dedicated asset investment subsidiaries. These subsidiaries would be designed to channel more capital into the tech economy, aligning with broader efforts to increase financing options for technology-focused companies through initiatives like the Sci-Tech Bond Board.

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