(Yicai) March 14 -- China plans to hike spending on equipment upgrades in the industrial, agricultural, and other key sectors by 25 percent in 2027 compared with last year, according to a government action plan.

The country aims to launch this big new round of equipment upgrading to promote energy saving, emissions reductions, digital transformation, and smart upgrades in key industries, under the cabinet’s plan released yesterday.

China invested about CNY4.9 trillion (USD682 billion) on new equipment in the key industrial and agricultural sectors last year.

Equipment upgrades will contribute between 1.2 point and 1.5 point to the increase in China’s fixed asset investment, boosting economic growth by about 0.4 point, the Bank of China Research Institute said in a report.

With the deepening of high-quality development, the demand for new equipment will continue to expand, driving spending to at least CNY5 trillion (USD695.3 billion) a year, Zheng Shanjie, chairman of the National Development and Reform Commission, said at a press conference held during China’s annual policy setting meetings, which ended on March 11.

The government also aims to boost the use of digital research, development, and design tools at large industrial firms to over 90 percent by the same year, along with an increase in the computer numerical control rate of key processes to 75 percent, according to the plan.

Under the plan, consumers will be encouraged to trade in their old goods, with the recycling of scrapped vehicles, used car transactions, and recycled home appliances expected to soar two-fold, 45 percent, and 30 percent, respectively, by 2027.

The number of civilian-use cars in China reached 336 million at the end of last year, and that of home appliances exceeded 3 billion, Zheng added, noting that the replacement of old goods could hit CNY1 trillion.

Home appliance trade-ins may drive China’s gross domestic product to grow between 0.16 point and 0.5 point, according to the Bank of China Research Institute’s report.

Editor: Futura Costaglione