Open new strategic directions

The 3rd Plenary Session of the 20th Central Committee of the Communist Party of China, themed “Study on the Issue of Further Comprehensively Deepening Reform and Promoting Modernization Along the Chinese Model,” held in Beijing from July 15 to 18, is attracting great attention.

General Secretary and President of China Xi Jinping. (Source: THX/TTXVN)

Important events

The 3rd Central Conference is held every 5 years and is usually held one year after the National Party Congress. However, this Conference is held nearly 2 years after the 20th National Party Congress closed in October 2022.

The Third Plenum of the Central Committee is an event of special significance in the history of the Communist Party of China and in the memories of the Chinese people. At the Third Plenum of the 11th Central Committee held in 1978, Chinese leaders “initiated reform and opening up”, a policy that played an important role in China’s explosive and rapid development over the past four decades.

Song Lin, chief economist for China at Netherlands-based ING Bank, said that the 3rd Plenum of the Central Committee was convened at a very important time. Chinese leaders will introduce new policies to stabilize growth and continue to bring the world's second largest economy to a more sustainable recovery. According to ING data, despite facing many challenges, especially after the Covid-19 pandemic, China's GDP in the first quarter of 2024 still increased by 5.3% year-on-year, higher than expected.

However, Huang Yiping, director of the National Institute for Development Studies at Peking University and a member of the Monetary Policy Committee of the People's Bank of China, said at a recent conference that expectations cannot be too high at this point because the current overall environment is a "policy pendulum" with key challenges changing. Huang Yiping emphasized that in the current environment, one should not expect too bold market-oriented liberalization reforms.

Meanwhile, Mr. Xu Tianchen - senior analyst on the Chinese economy at the Economist Intelligence Unit (EIU) of The Economist Group also said that at this conference, Chinese leaders will hardly be able to introduce breakthrough reforms like the 1978 Conference but will likely apply a step-by-step reform approach.

Agenda issues

In that context, according to observers, the key issues discussed at this conference include ways to promote innovation and improve labor productivity, research and development, protect intellectual property rights, design and implement industrial policies, reform state-owned enterprises and empower the private sector, etc.

According to Alexander Davey, an analyst at the Mercator Institute for China Studies in Europe, the vision of China-style modernization driven by “new quality productive forces” will occupy a prominent place on the agenda of the conference. This is similar to the Third Plenum of the 11th Central Committee, when leader Deng Xiaoping proposed “liberating productive forces” to boost economic growth and create a framework for the operation of a Chinese-style market economy.

In addition, issues to be discussed at this conference may include extending the retirement age, financial reform, loosening the land regime, new tax regime, further opening up the economy and policies to encourage childbirth...

Change in the new context

According to the EIU, the challenges China faces today are different from those at the 3rd Central Conference in 1978. In the external environment, there are still differences in the Sino-US relationship, competition in trade (export restrictions, high tariffs on car batteries, electric vehicles, etc.), and competition in the field of science and technology (chip manufacturing, semiconductors, 5G technology, space science, etc.).

Domestically, after more than 40 years of rapid economic development, the complexity of problems and expectations of the Chinese people today have also changed a lot. Meanwhile, the aging population, falling birth rate... have made India surpass to become the most populous country in the world. In addition, according to eurasiareview.com, a characteristic of the Chinese economy that has persisted for most of the reform period is relatively weak consumption. The proportion of consumption in GDP will only reach about 56% in 2023, about 20% lower than the world average...

China is entering an important stage of development, many of its previous growth drivers such as its role as the "world's factory" and becoming a middle-income country have been or are being changed with higher development goals. Promoting breakthrough innovation, unleashing consumption potential, sharing the fruits of development more with the people, and developing new quality production forces will be some of the important directions that the Communist Party of China will thoroughly discuss at this Central Conference.

Source: https://baoquocte.vn/hoi-nghi-trung-uong-3-khoa-xx-cua-trung-quoc-mo-huong-di-chien-luoc-moi-278921.html