In the development of the digital economy, Xiao Gang, a member of the Chinese People's Political Consultative Conference (CPPCC) National Committee, has called for efforts to ensure security, address difficulties faced by small- and medium-sized enterprises (SMEs) in digital transformation, and pursue innovative integration among sci-tech, industries and finance.

The former chairman of the China Securities Regulatory Commission said in an interview that the digital economy mainly includes two parts, commercialization of digital technologies and digital transformation of industries. The latter is the mainstay to inject strong development momentum into traditional sectors.

According to Xiao, the industrial internet of things (IoT) has in recent years seen rapid growth in China and already expanded from leading enterprises to upstream and downstream firms of the entire industrial chain, from just offering services at separate steps to a full-fledged synergy across all stages.

As the industrial internet enters a critical development stage, he outlined efforts on three fronts its development: a proactive approach to new types of infrastructure in order to release the potential of 5G network, an accelerated building of public service platforms and data centers, and breakthroughs in core industrial software and technologies.

Xiao hailed the inter-ministerial joint conference system on the development of the digital economy, recently established with the approval of the State Council, as a timely response to the concerns of market players and a milestone in enhancing top-level design and coordination mechanism. He also expected this joint conference system to coordinate the relationship between development and security concerns and introduce comprehensive measures to overcome obstacles in digital transformation of SMEs.

For the campaign to promote cooperation between industry and the financial sector, an ongoing initiative since 2016 to address financing difficulties, Xiao said financial institutions should actively support the development of advanced manufacturing industries with "one-stop" services, such as investment, financing, payment and settlement, cash management and cross-border business.

Xiao said that financial institutions also need to step up efforts to provide online financial services to corporate clients, improve the service of Supply Chain Finance, promote concerted growth among sci-tech, industry and financial sectors, and pool all resources to support technology startups.

He added that it's also important to strictly regulate related-party transaction, enhance the governance of financial holding companies, and prevent the spread of risks between industry and the financial sector.