BEIJING, Nov. 29 (Xinhua) -- A pivotal document of the Communist Party of China (CPC) adopted in October highlighted the need to "combine investment in physical assets with investment in human capital."

At a key Party plenum last month, the CPC leadership adopted its recommendations for formulating the 15th Five-Year Plan (2026-2030), outlining China's economic and social development priorities for the next five years.

Emphasizing the importance of investment in human capital, rather than solely in physical assets, marks an upgrade in China's investment philosophy and focus areas, with significant implications for promoting people's well-rounded development.

What is investment in human capital? Why is it important?

It refers to inputs that develop people's capabilities and unlock their potential at all stages of life, including childcare, elderly care, health, education and skills training.

For many years, investment in physical assets, such as infrastructure, housing, and machinery, has played a crucial role in sustaining China's rapid economic growth.

However, during the 15th Five-Year Plan period and beyond, the importance and urgency of investing in people have become increasingly evident.

As global industrial competition shifts from "capital-intensive" to "talent-intensive," it has become essential for China to strengthen investment in human capital to advance innovation-driven, demand-led growth.

Creating a "human capital dividend" can help China build long-term economic competitiveness and secure a strategic advantage amid a new round of scientific and technological revolution and industrial transformation.

Furthermore, increasing investment in education, healthcare, and elderly care is crucial to ensuring and improving people's livelihoods, achieving a high-quality life, and fostering well-rounded individual development.

On the one hand, investment itself can drive economic growth; on the other hand, it helps enhance people's productive capacities, thereby boosting employment and personal income and unlocking consumption potential, said Zhang Linshan, a researcher at the Academy of Macroeconomic Research of the National Development and Reform Commission.

China intends to accelerate the narrowing of gaps in basic public services across regions, between urban and rural areas, and among different groups, and to expand public investment to cover the entire population at all stages of life.

More investment is expected in developing all types of talent, particularly leading scientists, top-notch innovators, and highly-skilled workers, to provide the foundational and strategic support needed for high-quality development. Enditem