China's 14th Five-Year Plan: what to expect?
The 5th plenary session of the 19th Central Committee of the Communist Party of China was held in Beijing from 26 to 29 October. Led by Xi Jinping, the central committee of China’s ruling Communist Party met in Beijing this week to discuss a proposal for national development from 2021 to 2025, China’s 14th Five-year Plan for Social and Economic Development.
The Five-Year Plans are a series of social and economic development initiatives issued since 1953 in thePeople's Republic of China. The 14th Five-Year Plan will set the framework for government policies from 2021 to 2025, as well as the vision and targets for the next 15 years. The plan will focus on boosting economic development after a period of economic challenges, in the midst of the global coronavirus pandemic and US-China tensions. Economists expect the target growth rate for the next 5 years to be 5-6% a year.
The finalized plan will not be made public before being formally approved by the National People’s Congress in March 2021. However, it can be expected that China will continue to focus on technology innovation, such as artificial intelligence, energy saving and new energy vehicles, new materials, biomedicine, etc. China is seeking to create a more self-reliant domestic economy, including domestic consumption, supplemented by external trade. At the same time China is expected to continue opening up its markets, including easing restrictions for foreign investors and lowering tariffs and non-tariff barriers on imports.
The Five-Year Plan may also see China accelerate its adoption of clean energy. The current goal is to derive as much as 20% of primary energy use from non-fossil fuels by 2030. In September 2020 president Xi even announced that China plans to be carbon neutral by 2060.
It is clear that China, the world’s second largest economy, is ready to play a bigger role in the world’s future agenda and to share its achievements with other countries. All developments in China will not only impact China’s economic and social development in the next decades, but will have a big impact on a global scale, also for European and Belgian companies. Foreign companies are expected to enjoy better market access and reasonable treatment as China promises to provide an encouraging business environment for various companies in different industries. This approach will make China’s growth more sustainable and also gives business opportunities to foreign and domestic companies to work together.
This is an abstract from an article written by Bart Horsten and published on the WeChat account of the Belgian-Chinese Chamber of Commerce on 29 October 2020.