How will China shape its development strategy for new stage?

China’s development is entering a new stage. This is the latest assessment made by Xi Jinping, general secretary of the Communist Party of China Central Committee, on the future prospects of the world’s second-largest economy as it prepares economic and social development plans for the next five years.

The next five-year plan, the 14th in a row, is now very much in the spotlight. The plan period (2021-2025) will mark the first five years of China’s new journey toward fully building a modern socialist country and marching toward the second centenary goal, according to Xi, who delivered his comments this week at a symposium with experts on economic and social work.

How will China navigate this new stage of development? What will China’s economic and social roadmap be in post-epidemic era? Here are some takeaways from the symposium.

FORWARD-LOOKING PLANNING
Drawn up every five years since 1953, the five-year plan is a major feature of China’s governance system, setting growth targets and defining economic and social development policies to ensure national strategies keep pace with the times.

At the symposium this week, Xi, reiterating that the world is undergoing profound changes unseen in a century, stressed the adoption of a long-term perspective, grasping the trend of the times and extensively pooling wisdom to study new circumstances and make new plans.

To reflect the forward-looking vision, when the Communist Party of China Central Committee meets in October to outline the 14th Five-Year Plan, a longer-term vision for 2035 will also be put up for discussion, envisioning a period during which the country’s socialist modernization is expected to be basically achieved.

Experience has shown that conducting mid- to long-term planning would allow the market to play a decisive role in the allocation of resources, while allowing the government to play a better role, Xi said at the symposium.

“The 14th Five-Year Plan will be a critical plan, drawn up at a critical time,” said Wang Changlin, president of the Academy of Macroeconomic Research of the National Development and Reform Commission, who attended the symposium.

China should be fully aware of both the increasingly complicated external environment and its distinctive advantages, staying strategically focused and preparing for a “protracted war,” said Wang.

AN OPEN DUAL CIRCULATION
First introduced in May this year, the new development pattern known as “dual circulation”, which takes the domestic market as the mainstay while letting domestic and foreign markets boost each other, has been placed high on the authorities’ agenda.

Describing the new pattern as a “strategic choice,” Xi said it is by no means a closed domestic loop, but an open dual circulation that involves both the domestic and foreign markets.

He also reaffirmed that opening-up is a fundamental national policy, noting that China will see its status continue to rise in the world economy, with closer ties, and the country will provide more extensive market opportunities for other countries.
Lu Ming, a professor with Shanghai Jiaotong University who was another speaker at the symposium, said Xi’s remarks have sent a clear signal dispelling concerns that China will shift its focus from opening-up to the domestic market.

Rather, Chinese policymakers are fully aware of the importance of further opening-up and are determined to follow the path of reform, he said. The new development pattern, with the domestic market being the mainstay, is in line with China’s efforts to expand domestic demand in the past decade, according to Jia Kang, chief of the China Academy of New Supply-side Economics.

Taking the domestic market as the mainstay does not mean zero exports, but greater volatilities and uncertainties in foreign trade within an unstable international environment, said Jia, emphasizing that China’s status as the “world’s factory” will not be changed.

INNOVATION AS KEY
In pursuing the new development pattern, scientific and technological innovation, especially making breakthroughs in core technologies, is widely regarded as the key to shaping domestic circulation.

At the symposium, Xi underscored creating new growth momentum through scientific and technological innovation, vigorously enhancing the capability to conduct innovation independently, and achieving breakthroughs in key and core technologies as soon as possible.

To this end, he urged giving full scope to enterprises as the main actors in technological innovation, and vigorously cultivating and introducing world-class talent and scientific research teams.

Innovation-driven development on technological fronts perfectly fits the needs of creating the dual-circulation pattern with the domestic market as the mainstay, said Lu, who noted that development propelled by domestic demand will particularly boost the well-being of the Chinese people.

Echoing Xi’s call, Robin Li, chairman and CEO of China’s internet giant Baidu, pledged to share the company’s data and computing power with millions of developers and partners to push for an industrial upgrade.

“By being creative and helping them solve problems and encourage innovation, we can stimulate the vitality of the (company’s) ecological chain,” said Li.

Xinhua News Agency