This year has been a turning point for the Chinese equity investment market, amid significant changes in the capital environment and related policies, said industry insiders.

Ni Zhengdong, chairman of venture capital and private equity firm Zero2IPO, said investment has remained active despite a “capital winter”, with total investment exceeding 1 trillion yuan ($145 billion) in the first 11 months of the year, a 6.6 percent decline year-on-year.

According to the company’s latest report, fundraising totaled 1.15 trillion yuan in the period, down 28.7 percent year-on-year. Ni forecast that number will decrease by 35 to 40 percent in total this year.

He made the remarks during the 18th China Venture Capital and Private Equity Annual Forum, where leading investors said the investment and entrepreneurship sectors would see both opportunities and challenges.

“Though it has been a confusing year (for investors), it is also a year that has brought the whole market to a more rational and reasonable level,” said Xiao Bing, president of Fortune VC, at the conference.

Zheng Weihe, board chairman of Cowin Capital Group, pointed out private equity firms’ previous arbitrage model, of investing before the IPO and immediately cashing out after, has come to an end.

Policies are expected to “open a new chapter”, Zheng said. “China has made a big transition to launch the Science and Technology Innovation Board, meaning that the country’s investment and entrepreneurship is in step with the world.”

On Dec 11, China announced it will further incentivize venture capital investment, to drive the country’s entrepreneurship and investment.

For venture capital firms that choose to have their taxes calculated as single investment funds, their individual partners will pay personal income tax on their earnings from transferring shares and stock dividends at 20 percent from next year.

“The latest policy will boost confidence among individual partners as it will be a great tax relief,” said a researcher at Zero2IPO Research, who did not disclose his name.

“It also has significance for the equity investment market. More individual partners will be attracted to invest, which broadens the fundraising channels in the market,” he said, adding that this in turn will relieve startups’ fundraising pressure.

“It is especially beneficial for limited partners to take part in the early-stage investment,” said Guo Libo, president of the ChinaVenture Institute.