By the end of this year, the revenues of China's cybersecurity industry are set to reach 63.1 billion yuan (8.9 billion U.S. dollars), reflecting a 23-percent increase year-on-year, said a report released by the China Academy of Information and Communications Technology (CAICT), quoted by Caixin Global.

These numbers indicate an upward trend. In 2017, the sector grew by 27.6 percent year-on-year to 43.92 billion yuan, said CAICT in its previous reports, predicting the revenues to hit 54.6 billion yuan in 2018.

According to the latest report, there are increasingly high requirements for network security due to the development of artificial intelligence, industrial internet, and 5G technology.

Wang Zhiqin, deputy director of CAICT, said: "The continuous optimization of China's cybersecurity policy has provided a good institutional environment for the industry."

The report released by the CAICT, a research institute under the Chinese Ministry of Industry and Information Technology, revealed that today China has almost 3,000 cybersecurity companies, eight percent more than 2017.

Geographically, one-third of the companies are headquartered in Beijing, 13 percent in south China's Guangdong Province, and 10 percent in Shanghai.

Chinese firms grow faster than global counterparts

As for profit growth, the report noted that even though profits slowed down in 2018, they were still higher than the global pace.

The 10 major cybersecurity companies registered an average profit of 38 million U.S. dollars in 2018, seven-percent higher than profits in 2017. Sluggish growth reflects pressures from increased research and development costs, employee salaries, and stiff competition.

Another report released this month by the global markets research firm International Data Corporation (IDC) said, in the next five years, China will lead the growth of the global cybersecurity market. By 2023, the market size is expected to grow to 17.9 billion U.S. dollars.  

Read more: President Xi underlines security, openness in cyberspace

The compound annual growth rate for China's cybersecurity spending from 2019 to 2023 will be 25.1 percent compared with the global average of 9.44 percent, Xinhua News Agency cited an IDC report.

The biggest spenders in cybersecurity will be the government, and communications and financial sectors, accounting for around 60 percent of the total spending.

The IDC estimates that global cybersecurity spending will surpass 150 billion U.S. dollars in 2023.