There has been lots of media coverage of the recent “Two Sessions” event in Beijing, the annual gatherings of the Chinese People’s Political Consultative Conference (CPPCC) and the National People’s Congress (NPC), which was kicked off by the reading of the Government’s Work Report last Friday.Some of the key takeaways from this report, offering some guidance on the Government’s priorities and plans for the coming year, were as follows:
- GDP growth target of ‘above 6%’ for the coming year (most market predictions are higher than this, around 8% or more)
- Target to create 11 million new jobs (up from a target of 9 million last year)
- A 30% increase in lending to small businesses by the large Banks
- Prevent monopolistic behaviour in the tech industry and restrict the unregulated expansion of capital
- Continued vigilance of Covid-19 with border controls expected to be maintained until 2022
- Increase in military spending of 6.8% to RMB1.355 trillion
- Extension in retirement ages and a focus on increasing fertility levels
- Release of housing stock and incentives to ensure stability and affordability for first time home buyers
- Close loopholes in Hong Kong’s electoral system to avoid foreign interference, including a firm commitment to strengthening the “one country, two systems” doctrine.
- Upgrade advanced manufacturing capabilities, particularly in rare earth and special materials, robotics, aircraft engines, new energy vehicles and smart cars, high-end medical equipment and innovative medicine, agricultural machinery, shipbuilding, aviation, high-speed rail equipment and satellites.
The final point above, and the significant emphasis on “advanced manufacturing” over the Two Sessions, is the central focus of China’s 14th Five Year plan (2021 to 2025) which spells out the country’s economic and development goals for the immediate future and is designed to “offset rising production costs, strengthen the country’s position in global supply chains, reduce reliance on foreign technologies and enhance its competitiveness against the US”, according to the SCMP.
As usual, there are no surprises in predicting China’s priorities and plans for the next five years. As has been the case with previous 5 Year Plans, it’s now up to the rest of us to work out what to do about it.