Which tech firms qualify as ‘little giants’? Beijing releases criteria for the ideal industrial enterprise

China has unveiled detailed criteria for determining which industrial enterprises qualify as “little giants”, as Beijing doubles down on its strategy to create an army of “small but powerful” firms to plug technology gaps.

Beijing already announced a target of cultivating 10,000 little giants by 2025, with officially recognised companies gaining access to preferential treatment such as subsidies, tax cuts and other grants. That move triggered a rush to identify small and medium-sized enterprises (SMEs) that could be contenders in products or processes that could help the country achieve its goal of tech self sufficiency.

According to the latest guidelines published by the Ministry of Industry and Information Technology (MIIT), the body in charge of the project, little giants need to have over three years of experience in a “crucial part of the supply chain” and hold at least 10 per cent market share in their niche.

Little giants must operate in strategically important industries such as semiconductors, software and artificial intelligence, and need to be able to “fix weaknesses” in the domestic supply chain, according to the MIIT application form.

Companies with more than 50 million yuan in annual revenue must also invest at least 3 million yuan (US$450,000) into research and development to qualify.

The regulator plans to develop a database of all high-quality SMEs to track their performance and provide targeted services to each company, according to the regulator.

The newly published notice did not elaborate on the type of supportive measures that would be offered to successful firms. However, last year the central government provided more than 10 billion yuan in subsidies to more than 1,000 national little giant enterprises, Xu Xiaolan, MIIT vice-minister, said earlier this year.