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China’s Internet Plus strategy set to fuel growth in new 5-year plan

China this year unveiled the Internet Plus strategy to kick off a Big Data revolution and boost economic output through new investments in the e-commerce sector. The initiative will also shape the 13th five-year plan hammered out at the CPC plenum in Beijing.

One of the buzz words that has made headlines in China in 2015 is Internet Plus.

Earlier this year, China laid out the Internet Plus strategy, which includes promoting cloud computing, online banking, and mobile internet to help e-commerce expansion and upgrade the financial industry.

“I think that Internet Plus will become more and more important in China, especially in the transformation and upgrade of the banking industry. During this process, Internet Plus will also greatly transform the credit system,” said Zong Liang, vice general manager of Bank of China.

China has already set aside 40 billion yuan - or more than 6 billion US dollars - in government funds for China’s emerging industries.

Premier Li Keqiang said that China will back e-commerce development and guide the international expansion by Chinese internet companies.

This will give firms such as e-commerce giant Alibaba Group or its rival JD.com a major boost. At the Financial Street Forum in Beijing this week, the latter said:

“Because of the Internet Plus strategy, our financial products in data mining, risk management and configuration have become much more efficient. For financial enterprises, it helps a lot to boost our diversification,” said Liu Changjong, VP of Jingdong Financial Group.

The Internet Plus strategy will also figure high in the 13th five-year plan unveiled by the Communist Party of China on Thursday, which sets the direction of the economic and social development for the years from 2016 to 2020.

China could soon surpass the United States to become the largest Internet market in the world.

China had 649 million internet users by the end of 2014, rising by 31 million from the previous year, official figures show.

The country’s household internet penetration rate stands at 47.9 percent, compared to 74.4 percent in the United States in 2013.

Bankers and analysts I’ve been talking to here are bullish that during the next 5-year plan, the Internet Plus strategy will become a new economic model and driver for China’s economy.