The Chinese technology sector has shown strong growth in early 2025, as reflected in the Hang Seng Tech Index’s nearly 30% increase year-to-date. This rally, supported by technological advancements and favorable government policies, marks a notable development in China’s tech landscape. The sector’s recovery has led to gains among major companies such as Baidu, Xiaomi, and Alibaba. Even some traditionally non-tech industries, such as telecommunications, have benefited from the increasing adoption of new technologies. This article will explore the factors contributing to this shift in China’s technology sector and its broader implications for the country’s digital economy. Policy reset signals new era President Xi Jinping’s February 2025 meeting with tech entrepreneurs marked a pivotal moment in China’s economic strategy. This first-of-its-kind gathering since 2018 signalled a dramatic shift from regulatory crackdowns to active support for innovation, directly addressing prior concerns over heavy-handed oversight. This shift was exemplified by Xi’s public endorsement of Alibaba’s Jack Ma, whose visibility had diminished following high-profile antitrust investigations....