In addition to several key reports, such as the government work report, and several key pieces of legislation, this year’s agenda also centers on the widely anticipated draft outline of the 15th Five-Year Plan for national economic and social development.

Compared with the Communist Party of China (CPC) leadership’s recommendations for formulating the 15th Five-Year Plan, released last October, the draft outline provides far more detail.

Spanning more than 70,000 Chinese characters and organized into 18 sections and 62 chapters, the outline is too extensive to cover fully in a single article.

So in this piece, I focus on a concept that has been widely discussed in Chinese policy circles over the past year: “invest in people,” or “investment in human capital” (投资于人).

The Emergence of the “Invest in People” Concept

The idea did not appear overnight. As early as 2023, the Chinese leadership mentioned in a high-level meeting that China should not only continue “investing in physical assets,” but should closely combine this with “investing in human capital.”

A year ago, during the 2025 “two sessions,” the government work report used the phrase “investment in people” for the first time, saying that “more funds and resources will be used to serve the people and meet their needs.”

The recommendations for the 15th Five-Year Plan released last year emphasized:

坚持扩大内需这个战略基点，坚持惠民生和促消费、投资于物和投资于人紧密结合

Guided by the strategy of expanding domestic demand, we should work toward improving living standards while increasing consumer spending and combine investment in physical assets with investment in human capital.

The draft outline released on March 5 continues this formulation.

Why Emphasize “Investing in People”?

An article published in December 2025 in Qiushi, a flagship magazine of the CPC Central Committee, helps clarify the policy logic.

According to the article, as China’s development stage and conditions change, the returns on “investing in physical assets,” such as infrastructure, housing, and machinery, have declined significantly. Between 2008 and 2023, China’s incremental capital-output ratio rose from 2.84 to 9.44, meaning that generating each additional yuan of GDP now requires several times more capital investment than before.

At the same time, capital-driven investment can expand production capacity in ways that do not necessarily match evolving consumer demand, leading to localized overcapacity and structural imbalances.

Meanwhile, rising incomes and the expansion of China’s middle-income population are increasing demands for better public services and higher quality of life. Yet mismatches in the domestic supply-demand structure continue to constrain people’s pursuit of a better life.

What Does “Investing in People” Mean?

In an interview with Qiushi, economist Yu Chunhai, a professor at Renmin University of China, explained the concept:

“投资于人”，是指将更多财政资金和公共资源投向教育、就业、医疗、社会保障等民生领域，投入到人的能力提升、健康维护、职业发展和潜力开发中，以消费潜力释放和人力资本提升驱动经济高质量发展。

“Investing in people” refers to directing greater fiscal funding and public resources toward livelihood-related sectors such as education, employment, healthcare, and social security, and toward enhancing human capabilities, safeguarding health, advancing career development, and unlocking individual potential, so as to drive high-quality economic development through the release of consumption potential and the strengthening of human capital.

Yu emphasized that “investing in people” is not merely a type of investment or a particular investment direction. Rather, it represents a new development orientation — one that serves as a correction to past models of investment, capacity expansion, and even the broader development paradigm.

Furthermore, “investing in people” aims to raise individuals’ levels of knowledge, skills, health, and social adaptability, thereby improving the overall human capital and professional skills of society. The goal is to transform “human resources” into “human capital” capable of sustainable value creation, and to move from a “demographic dividend” to a “talent dividend.”

Where Will China “Invest in People”?

Following this logic, “investing in people” covers a wide range of areas. From the draft outline of the 15th Five-Year Plan, I’ve picked out a few examples that, in my view, highlight how this people-centered investment approach will shape China’s policy priorities over the next five years.

1. New Livelihood-Focused Targets & Major Livelihood Projects

Among the plan’s 12 key expected indicators, many relate directly to people’s well-being. Compared with the 14th Five-Year Plan, some targets have been adjusted. Here are examples:

• Life expectancy is expected to rise from 79.25 years to 80 years.

• The previous indicator of basic pension insurance participation rate has been replaced with the share of nursing-care beds in eldercare institutions, expected to increase from 68% to 73%.

• The metric of childcare slots per 1,000 people has been replaced with childcare enrollment for children under age three, expected to increase by 6 percentage points.

• The indicator of physicians per 1,000 people has been refined into two metrics: licensed physicians (3.7 per 1,000) and registered nurses (5.1 per 1,000).

To me, these adjustments suggest a more refined approach to people-centered services and a stronger emphasis on their tangible outcomes.

In addition, it is noteworthy that Chinese policymakers have emphasized that “the most important indicator of modernization is still the health of the people” and that “health is 1, and everything else is the zeros that follow,” characterizing the steady increase in average life expectancy as a reflection of the advantages of China’s socialist system.

加强人力资源开发和人的全面发展投资，在“一老一小”服务、基层医疗卫生、普通高中和优质高等教育扩容、职业技能培训等领域实施一批民生工程，提高民生类政府投资比重。

Strengthen investment in human resource development and in the comprehensive development of people. Implement a number of public welfare projects in areas such as services for the elderly and children, primary-level healthcare, the expansion of general high schools and high-quality higher education, and vocational skills training, while increasing the share of government investment devoted to livelihood-related areas.

Among the 109 major projects listed in the draft outline, 25 are related to improving people’s livelihoods, including 4 projects on building a high-quality education system, 7 projects related to healthcare, 5 projects focused on services for “the elderly and the children” populations.

This morning, the heads of five ministries related to people’s livelihood held a joint press conference, answering journalists’ questions on issues in the livelihood sector during the 15th Five-Year Plan period. The full transcript is available for those interested.

2. Paid Leave and New School Vacation Policies

落实职工带薪休假制度，鼓励弹性错峰休假，探索推行中小学生春秋假。

Implement the paid annual leave system for employees, encourage flexible and staggered vacation arrangements, and explore the introduction of spring and autumn breaks for primary and secondary school students.

The earlier policy recommendations already mentioned paid leave. The new outline adds concrete language about staggered vacations and school holiday experiments. The government work report, which includes plans for the coming year, also reiterated this point, suggesting implementation may accelerate.

According to People’s Daily, several provinces in China have already begun experimenting with spring and autumn breaks.

Lu Ming, a professor at Shanghai Jiao Tong University, has long advocated optimizing holiday arrangements across the year. According to him, short breaks in spring and autumn could stimulate consumption while also giving children and families much-needed breathing room.

He argues that China hopes to make consumption a new driver of economic growth — and much of the potential lies in sectors such as education, healthcare, culture, and tourism. But these forms of consumption depend on people having both the time and the well-being to enjoy them.

Lu, who is also a national political advisor, points out that many workers today feel they cannot take leave even when legally entitled to it, due to widespread overtime culture. Policies such as school breaks may therefore need to be paired with flexible leave arrangements for parents.

3. Talent Development in Strategic Technologies

围绕科技创新、产业发展和国家战略需求协同育人，提高人才自主培养质量。聚焦优势学科适度扩大“双一流”建设范围，新建若干所新型研究型大学。

Coordinate talent development with technological innovation, industrial development, and national strategic needs, and improve the quality of independently trained talent. Focus on key disciplines and appropriately expand the scope of the “Double First-Class Initiative,” while establishing several new research-oriented universities.

健全高等教育学科专业设置调整机制，超常规布局人工智能、集成电路等新兴领域急需学科专业，深入实施基础学科和交叉学科突破计划。

Improve the mechanism for adjusting disciplines and programs in higher education, make extraordinary arrangements for urgently needed disciplines in emerging fields such as artificial intelligence (AI) and integrated circuits, and advance in-depth implementation of breakthrough plans for basic and interdisciplinary disciplines.

China’s AI-related industries will be valued at more than 10 trillion yuan (1.45 trillion U.S. dollars) by the end of the 15th Five-Year Plan period, Zheng Shanjie, head of the National Development and Reform Commission, said at a press conference on Friday.

Such projections underscore the importance of investing in people in frontier technological fields. Planning talent development early in sectors such as AI can ensure that more people have opportunities to apply their skills and build careers in emerging industries.

As AI becomes a defining technology of the next technological revolution, strengthening the talent pipeline is critical. According to Li Jinghong, a national political advisor and a professor at Tsinghua University, AI is not only a key technology for the next technological revolution but also a crucial indicator of national innovation capacity. This, he said, requires systemic reforms that allow education, science, and industry to reinforce one another.

4. Building a Birth-Friendly Society

坚持生育友好的政策取向，推动生育支持融入经济社会发展各项政策。

Adhere to a birth-friendly policy orientation and enhance childbirth support through various economic and social policies.

While last year’s recommendations called for improving childbirth support policies (”优化生育支持政策”), the new outline goes further, emphasizing that birth support should be integrated into various economic and social policies.

Specific measures include:

• effectively eliminating out-of-pocket costs for hospital childbirth within policy coverage

• fully implementing maternity leave systems

• encouraging flexible work arrangements for parents with children under three

• allowing children from multi-child families to attend the same school

• direct housing policies in favor of families with two or more children

These policies signal a stronger commitment over the next five years to building a birth-friendly social environment.

5. Reforming Population Management and Urbanization

探索建立全国统一的人口管理制度，逐步实现由常住地登记户口。稳步提高农民工参加城镇职工社会保险比例，推动更多城市将符合条件的未落户常住人口纳入公租房保障范围。

Explore the establishment of a nationally unified population management system, and gradually realize household registration based on place of habitual residence. Steadily increase the proportion of migrant workers participating in the urban employee social insurance system, and encourage more cities to include eligible long-term residents without local household registration in the public rental housing support system.

因地制宜放宽在流入地参加中考报名条件，推进符合条件的随迁子女连续接受基础教育。

According to local conditions, relax the requirements for registering for the senior high school entrance examination in the place of residence, and promote the continuous access to compulsory education for eligible children who move with their parents.

An analysis published in February in the journal Governance （《国家治理》), affiliated with the People’s Daily, notes that many regions still require household registration (hukou) to access subsidized medical and pension insurance. This creates barriers to equal social protection between registered and non-registered residents.

The analysis noted that the issue is significant because, as labor markets become more integrated and population mobility increases, the separation between a person’s place of residence and their household registration has become increasingly common. For example, in Zhejiang, more than 16 million of the province’s 66 million residents do not hold local household registration. The proportion is even higher in Guangdong.

Advancing people-centered urbanization, therefore, becomes crucial. Policies such as establishing a unified population management system help ensure equal access to social security and public services, representing another important dimension of China’s emerging “investing in people” development strategy.

There are many other elements in the draft outline related to “investing in people” that I have not covered here. If you think there are important points that I missed, feel free to leave a comment and share your thoughts.

I’d like to end this newsletter with an explanation from Qiushi:

“投资于人”不是摒弃“投资于物”，而是追求两者之间的紧密结合和良性互动。物的投入与积累，最终是为了实现人的发展 ...... 二者的紧密结合，是对我国投资理念、方向、重点的提升和优化。

“Investing in human capital” does not mean abandoning “investing in physical assets.” Rather, it seeks close integration and positive interaction between the two. Investment in and accumulation of material resources ultimately serve the purpose of human development ... The close combination of “investing in human capital” and “investing in physical assets” represents an upgrading and optimization of China’s investment philosophy, direction, and priorities.

Please note that the analysis in this piece does not represent any official view, and reflects only my personal analysis and judgment.

Such meetings are a long-standing practice in China’s policy process. Before the Government Work Report is formally presented to the National People’s Congress, senior leaders typically convene representatives from different sectors to gather feedback and calibrate policy priorities.

At the meeting, Li urged officials to thoroughly implement the Communist Party of China (CPC) Central Committee’s recommendations for formulating the 15th Five-Year Plan and the decisions made at the Central Economic Work Conference, using the certainty of high-quality development to address the uncertainties in the development environment, and called for a more proactive fiscal policy and a moderately loose monetary policy.

He also highlighted the need to closely integrate pro-people policies with consumption promotion, and combine investment in physical assets with investment in human capital to foster new drivers of economic growth and continuously enhance public welfare.

Nine representatives spoke at the symposium [video]. While official footage has not disclosed what each individual said, Xinhua’s readout notes that the speakers came from academia, the business community, and sectors including education, science, culture, public health, and sports.

On Tuesday, The Paper (澎湃新闻) published brief profiles of each of the nine speakers, drawing on their professional backgrounds and areas of expertise. I found these profiles particularly illuminating in understanding how policymakers may be thinking about the Government Work Report and the upcoming Five-Year Plan. Below, based on The Paper’s reporting, I share short introductions to the nine speakers who took part in this symposium:

1. 明明 Mingming: He received his master’s degree from the Tsinghua University People’s Bank of China School of Finance (PBCSF) and his PhD from the Chinese Academy of Social Sciences. He previously worked at the Monetary Policy Department I and II of the People’s Bank of China and joined CITIC Securities in 2015. His research focuses on macroeconomics, interest rates, monetary policy, and liquidity.

2. 贺佳 He Jia: Professor, vice dean and PhD supervisor of the School of Finance at Nankai University, and a recipient of the Ministry of Education’s National Young Talent Program. She is a Fellow of the Asian Bureau of Finance and Economic Research (ABFER) and one of Nankai University’s “Top 100 Young Academic Leaders.” Her research interests include real estate finance, household finance, and consumer finance.

3. 闫俊杰 Yan Junjie: Born in 1989, he serves as CEO of MiniMax and represents China’s large AI model enterprises, making him the second such representative to attend Premier Li Qiang’s symposium after DeepSeek founder Liang Wenfeng. Public information shows that MiniMax was founded in early 2022 and is among the few large-model companies that have focused on full-modality model development since inception. MiniMax was listed on the Hong Kong Stock Exchange on January 9 this year, with a latest market capitalization of nearly HK$120 billion.

4. 张智刚 Zhang Zhigang: Currently an alternate member of the 20th Central Committee of the CPC, and Chairman and Party Secretary of State Grid Corporation of China.

5. 龚旗煌 Gong Qihuang: Currently an alternate member of the 20th Central Committee of the CPC, and the deputy party secretary and president of Peking University.

6. 余晓晖 Yu Xiaohui: Member of the 14th National Committee of the Chinese People’s Political Consultative Conference, currently the president and deputy party secretary of the China Academy of Information and Communications Technology, and a senior engineer. He has long been engaged in research on information and communications technology and industry, communication networks, informatization, industrial integration, and the digital economy.

In the 1990s, he focused on communication network simulation, routing technologies, and network optimization and planning. Since 2000, he has led systematic research in areas including the industrial internet, “Broadband China,” the internet and mobile internet, the Internet of Things, digital infrastructure, and digital transformation, helping to promote industrial technological innovation and applications.

7. 王拥军 Wang Yongjun: Academician of the Chinese Academy of Sciences; deputy party secretary and president of Beijing Tiantan Hospital, Capital Medical University; chief scientist, professor and PhD supervisor of the Neurology Center; director of the National Medical Quality Control Center for Neurological Diseases; deputy director of the National Clinical Research Center for Neurological Diseases; and director of the Department of Clinical Epidemiology and Clinical Trials at Capital Medical University.

8. 周莉亚 Zhou Liya: Born in 1981, she and her partner Han Zhen are widely known in the dance community as the “Twin Stars of Dance.” They have jointly choreographed and directed dance dramas including A Tapestry of a Legendary Land (《只此青绿》) and The Eternal Wave, and also served as chief directors of China’s 80th Victory Anniversary Commemorative Gala. In 2021, the dance-poetry drama A Tapestry of a Legendary Land, which she co-directed with Han Zhen, became a nationwide cultural phenomenon and a landmark dance IP.

A Tapestry of a Legendary Land (《只此青绿》)

9. 石宇奇 Shi Yuqi: Born in 1996, he is a Chinese men’s singles badminton player and world champion.

Shi claimed the men’s singles title at the 2025 BWF World Championships, ending a decade-long title drought for China in the event.

If you’d like to do your own close reading, I’ve included the full English text at the end of this newsletter.

The year 2025 marks the completion of China’s 14th Five-Year Plan for economic and social development ... Our economic strength, scientific and technological abilities, defense capabilities, and composite national strength all reached new heights.

Early in the address, Xi offers a retrospective on China’s development over the past five years. That framing matters: 2025 is the final year of China’s 14th Five-Year Plan, which likely explains why this year’s speech includes a more explicit assessment of China’s overall strength than last year’s did.

This language aligns closely with how Chinese policymakers currently describe the country’s trajectory. An official explanatory reader released this year alongside the 15th Five-Year Plan recommendations notes that “China’s international influence, appeal and capacity to shape the world continue to grow” (我国国际影响力、感召力、塑造力不断提升). Taken together, these formulations amount to a concise summary of how China’s leadership now evaluates China’s standing — and they also reflect a noticeably more self-assured national self-image.

We integrated science and technology deeply with industries, and made a stream of new innovations. Many large AI models have been competing in a race to the top, and breakthroughs have been achieved in the research and development of our own chips. All this has turned China into one of the economies with the fastest growing innovation capabilities.

The speech does not name DeepSeek, a “phenomenon-level” product that sparked a wave of attention in China’s tech sector at the start of the year. Still, when Xi turns to science and technology, he opens directly with AI models — a small but telling choice of emphasis. It signals both the priority Chinese leaders attach to this field and their confidence in China’s progress.

The description of China as “one of the economies with the fastest-growing innovation capabilities” reinforces a long-standing narrative about China’s development path. Many of you will be familiar with Dan Wang’s book Breakneck: China’s Quest to Engineer the Future, which has been widely discussed in U.S. policy and analytical circles this year. The Economist called it “a useful way to think about industrial competition between America and China.”

Over the past year, the rights and interests of the workforce in new forms of employment have been better protected ... When the happy hum of daily life fills every home, the big family of our nation will go from strength to strength.

Any mention of the “workforce in new forms of employment” inevitably brings to mind China’s more than 10 million food-delivery riders. This year, several major internet platforms such JD.com began offering social insurance and other employee benefits to delivery workers — a move which marks a significant step toward standardizing the food delivery industry in China. Yuzhe He has an excellent piece on this shift.

China’s 7.48 million ride-hailing drivers are another group worth watching under this “new employment” umbrella. I’ve previously published a dedicated piece on them as well.

After announcing the three global initiatives on development, security, and civilization, I put forward the Global Governance Initiative to promote a more just and equitable global governance system. The world today is undergoing both changes and turbulence, and some regions are still engulfed in war.

The Global Governance Initiative is the fourth major global initiative China has proposed in recent years, following the Global Development, Security, and Civilization Initiatives. In an article published in Qiushi, the CPC Central Committee’s flagship magazine, Foreign Minister Wang Yi wrote that “global governance stands at a critical juncture. It will either move forward or fall back, and China’s diplomacy as a major country with Chinese characteristics has entered a historical stage in which it can accomplish more” (全球治理正处在承前启后、不进则退的关键时期；中国特色大国外交已进入可以更有作为的历史阶段).

This language is revealing when set against history. In the late 1980s and early 1990s, Chinese leaders advanced the guideline often summarized as “keeping a low profile while accomplishing something” (韬光养晦，有所作为). Today’s formulation — “a historical stage in which it can accomplish more” (可以更有作为的历史阶段) — reflects how current policymakers assess both China’s development phase and the international environment.

If you want to dig deeper into what the Global Governance Initiative means, Wang Yi’s full article is worth reading.

We Chinese on both sides of the Taiwan Strait share a bond of blood and kinship. The reunification of our motherland, a trend of the times, is unstoppable!

References to Taiwan are a regular feature of China’s New Year addresses. Last year’s speech stated:
“We Chinese on both sides of the Taiwan Strait belong to one and the same family. No one can ever sever the bond of kinship between us, and no one can ever stop China’s reunification, a trend of the times.”

Personally, I don’t see a dramatic shift in tone this year. But if you read it differently, I’d genuinely like to hear your take.

Only a strong Communist Party of China can make our country strong. We launched the study and education program on fully implementing the central Party leadership’s eight-point decision on improving Party and government conduct. We exercised strict governance of the Party through credible measures, and promoted the Party’s self-revolution to fight corruption and advance healthy governance.

From March to July, a Party-wide education campaign was rolled out to implement the central Party leadership’s eight-point decision on improving work conduct.

Those familiar with China’s last decade will recall that the eight-point rules were issued by the Political Bureau of the CPC Central Committee in December 2012 shortly after Xi Jinping first became the general secretary of the CPC Central Committee. The rules aim to reduce bureaucracy, extravagance and undesirable work practices of Party members.

Earlier this year, I published a standalone newsletter on the eight-point education campaign. It ended up being one of my ten most-read pieces of the year. At the time, I wrote:
“Looking forward to 2025, continuing to implement the spirit of the eight-point rules as a central theme in Party education holds profound importance.”

That framing now looks even more relevant. The article from the China Discipline Inspection and Supervision Newspaper explained that this year’s focus on the eight-point rules comes at a time when changes unseen in a century are unfolding across the world at a faster pace and an increasingly complex and severe external environment may exert a greater impact on China.

Even topics that appear highly domestic, such as the study and education campaigns around the eight-point rules, can offer useful insight for international readers trying to understand how China responds under pressure.

The year 2026 marks the beginning of the 15th Five-Year Plan. A successful venture should start with a good plan and with clear goals set.

If you want to read more about the 15th Five-Year Plan, I’ve linked two previous newsletters below.

The dream lofty, the journey long—bold strides will get us there. Let us charge ahead like horses with courage, vitality, and energy, fight for our dreams and our happiness, and turn our great vision into beautiful realities.

Readers familiar with China know that birth years follow a twelve-animal zodiac cycle. This year is the Year of the Snake — I was born in 1989, also a Snake year, for what it’s worth. From February 17, 2026, to February 5, 2027 (before Lunar New Year), it will be the Year of the Horse.

That timing makes it easy to understand why the speech includes several horse-related expressions of good fortune. Sometimes, the subtext is simply cultural.

Full text: Chinese President Xi Jinping’s 2026 New Year Message

BEIJING, Dec. 31 (Xinhua) -- On New Year’s Eve, Chinese President Xi Jinping delivered his 2026 New Year message through China Media Group and the internet. The following is the full text of the message:
Greetings to all! Year after year, life opens a fresh chapter. As the new year begins, I extend my best wishes to you from Beijing!
The year 2025 marks the completion of China’s 14th Five-Year Plan for economic and social development. Over the past five years, we have pressed ahead with enterprise and fortitude, and overcome many difficulties and challenges. We met the targets in the Plan and made solid advances on the new journey of Chinese modernization. Our economic output has crossed thresholds one after another, and it is expected to reach RMB 140 trillion yuan this year. Our economic strength, scientific and technological abilities, defense capabilities, and composite national strength all reached new heights. Clear waters and lush mountains have become a salient feature of our landscape. Our people enjoy a growing sense of gain, happiness and security. The past five years have been a truly remarkable journey, and our accomplishments have not come easily. Your unwavering hard work has made our nation thrive and prosper. I salute you all for your exceptional diligence and invaluable contributions.
This year is full of indelible memories. We solemnly commemorated the 80th anniversary of the victory of the Chinese People’s War of Resistance Against Japanese Aggression and the World Anti-Fascist War, and established the Taiwan Recovery Day. These grand national events were majestic and powerful, and the glory of victory will shine through the pages of history. They are inspiring all the sons and daughters of the Chinese nation to remember history, honor fallen heroes, cherish peace, and create a better future. They are rallying a mighty force for the great rejuvenation of our nation.
We sought to energize high-quality development through innovation. We integrated science and technology deeply with industries, and made a stream of new innovations. Many large AI models have been competing in a race to the top, and breakthroughs have been achieved in the research and development of our own chips. All this has turned China into one of the economies with the fastest growing innovation capabilities. The Tianwen-2 probe began its star-chasing journey to explore asteroids and comets. Construction of the hydropower project at the lower reaches of the Yarlung Zangbo River started. China’s first aircraft carrier equipped with an electromagnetic catapult system was officially commissioned. Humanoid robots did kung fu kicks, and drones performed spectacular light shows. Inventions and innovations have boosted new quality productive forces and added colorful dimensions to our lives.
We endeavored to nurture our spiritual home with cultural development. There was a surging public interest in cultural relics, museums, and intangible cultural heritage. A new Chinese cultural site was added to the World Heritage List. Cultural IPs such as Wukong and Nezha became global hits. The younger generation came to deem classic Chinese culture as the finest form of aesthetic expression. The cultural and tourism sectors thrived. The “super league” football games in our cities and villages attracted numerous fans. Ice and snow sports ignited people’s passion for the winter season. Tradition is now embracing modernity, and the Chinese culture is shining in even greater splendor.
We joined hands to build a better life and enjoyed it together. I attended celebrations in Xizang and Xinjiang. From the snow-covered plateau to both sides of the Tianshan Mountains, people of various ethnic groups are united as one, like seeds of a pomegranate sticking together. With white khatas and passionate singing and dancing, they expressed their love of the motherland and the happiness they enjoy. No issue of the people is too small; we care for every leaf and tend every branch in the garden of people’s well-being. Over the past year, the rights and interests of the workforce in new forms of employment have been better protected, facilities have been upgraded to bring more convenience to the elderly, and each family with childcare needs has received a subsidy of RMB 300 yuan per month. When the happy hum of daily life fills every home, the big family of our nation will go from strength to strength.
We continued to embrace the world with open arms. The Shanghai Cooperation Organization Summit in Tianjin and the Global Leaders’ Meeting on Women were very successful; and island-wide special customs operations were launched in the Hainan Free Trade Port. To better address climate change, China announced new Nationally Determined Contributions. After announcing the three global initiatives on development, security, and civilization, I put forward the Global Governance Initiative to promote a more just and equitable global governance system. The world today is undergoing both changes and turbulence, and some regions are still engulfed in war. China always stands on the right side of history, and is ready to work with all countries to advance world peace and development and build a community with a shared future for humanity.
Not long ago, I attended the opening ceremony of the National Games, and I was glad to see Guangdong, Hong Kong and Macao coming together in unity and acting in unison. We should unswervingly implement the policy of One Country, Two Systems, and support Hong Kong and Macao in better integrating into the overall development of our country and maintaining long-term prosperity and stability. We Chinese on both sides of the Taiwan Strait share a bond of blood and kinship. The reunification of our motherland, a trend of the times, is unstoppable!
Only a strong Communist Party of China can make our country strong. We launched the study and education program on fully implementing the central Party leadership’s eight-point decision on improving Party and government conduct. We exercised strict governance of the Party through credible measures, and promoted the Party’s self-revolution to fight corruption and advance healthy governance. As a result, the conduct of our Party and government steadily improved. We must stay true to our original aspiration and founding mission, and pursue our goal with perseverance and dedication. We should continue to give a good answer to the question on how to maintain long-term governance put forth in a cave dwelling in Yan’an and prove ourselves worthy of the people’s expectation in the new era.
The year 2026 marks the beginning of the 15th Five-Year Plan. A successful venture should start with a good plan and with clear goals set. We should focus on our goals and tasks, boost confidence, and build momentum to press ahead. We should take solid steps to promote high-quality development, further deepen reform and opening up across the board, deliver prosperity for all, and write a new chapter in the story of China’s miracle.
The dream lofty, the journey long—bold strides will get us there. Let us charge ahead like horses with courage, vitality, and energy, fight for our dreams and our happiness, and turn our great vision into beautiful realities.
The sun of the new year will soon rise. May our great motherland stand in magnificence! May the fields across the country deliver good harvest! May our nation bathe in the glory of the morning! May you all enjoy life to the fullest, and achieve every success! May all your dreams come true! Enditem

For your convenience, I've also uploaded the Work Report of the National People's Congress (NPC) Standing Committee [Chinese][English], the Work Report of the Supreme People's Court [Chinese], the Work Report of the Supreme People's Procuratorate [Chinese], and the NPC Standing Committee's proposal to deliberate the draft amendment to the Law on the Delegates to the National People’s Congress and Local People’s Congresses [Chinese] to Google Drive for you to download and share with others.

In addition, I have posted a piece on Chinese Foreign Minister Wang Yi's press conference, which includes his response to a question that I asked at the press conference.

As I introduced in the previous newsletter, during the "two sessions," Chinese leaders engage with lawmakers in group deliberations and political advisors in group discussions, exchanging views on key governance-related topics. These interactions serve as a window for observing what they consider to be the most important issues for China's development and how the central leadership stays informed about grassroots realities.

Chinese President Xi Jinping, who is also a deputy of the delegation of Jiangsu Province, delivered a speech while he took part in a deliberation with his fellow deputies at the third session of the 14th NPC on Wednesday. On Thursday, he attended a joint group meeting with national political advisors from the China Democratic League, the China Association for Promoting Democracy, and the education sector. On Friday, he attended a meeting of the delegation from the armed forces.

Xinhua has released the full-text Chinese versions of the readouts of the three activities. The theme of Xi's speech on Wednesday is calling on powerhouses such as Jiangsu Province to play a major role in the country's overall development. The remarks Xi made during his meeting with the political advisors on Thursday are mainly focused on strengthening the role of education in supporting scientific and technological advancement as well as talent development. The speech Xi gave to the armed forces on Friday was about reaching a successful conclusion of the 14th Five-Year Plan (2021-2025) for military development.

Below are some highlights I selected and notes I added about these three activities.

Wednesday - Xi took part in a deliberation with his fellow lawmakers from Jiangsu Province 【Full-text English readout】

要全面落实民营企业座谈会精神，一视同仁对待各种所有制企业，持续优化营商环境。

It is essential to fully implement the guiding principles of the symposium on private enterprises held in February, treat all enterprises equally no matter what their ownership is, and make sustained efforts to improve the business environment.

The symposium on private enterprises is likely one of the most closely watched news stories in China ahead of this year's "two sessions." Xi's call for "fully implement" underscores his demand for local governments to effectively execute policies supporting the development of private enterprises, which is undoubtedly a positive signal.

习近平指出，经济大省在落实国家重大发展战略上应有更大的担当。

Xi noted that economic powerhouses should shoulder greater responsibilities in implementing the country's major development strategies.

In 2024, the top ten provinces and regions by GDP—including Guangdong, Jiangsu, Shandong, and Zhejiang—accounted for over 60 percent of the nation's total economic output while occupying nearly 20 percent of China's land area. These provinces are not only economic powerhouses but also vital to the broader stability of the nation's economic and social development, acting as "ballast stones."

Looking ahead to 2025, the GDP growth targets set by these top provinces vary slightly, with central China's Hubei Province aiming for a growth rate in the "6 percent range," while nine other provinces, including Jiangsu, have set their targets in the "5 percent range." This aligns with the national target, as outlined in the government work report submitted Wednesday to the national legislature for deliberation, which sets China's economic growth goal at "around 5 percent" for 2025.

“社区规模有多大？改造得怎么样？加装电梯普遍吧？老百姓意愿强吗？”对社区里的事，总书记问得十分细致。

"How large is the community? How has the renovation been progressing? Are elevators being widely installed? Were they well-received by the residents?" Xi meticulously inquired about details related to community affairs.

从社区治理谈到社会工作，总书记进一步指出：“社会工作一定要加强，对这些年出现的快递小哥、网约车司机、电商从业人员等，在管理服务上要跟上，填补好这个空白。”

Speaking on community governance and social work, Xi emphasized, "Social work must be strengthened. With the emergence of occupations such as deliverymen, ride-hailing drivers, and e-commerce workers in recent years, it is crucial that management and services keep pace and effectively address these gaps."

On Thursday, Xinhua published a "side story" on Xi's interactions with his fellow deputies from the delegation of Jiang Province. This report includes some details about Xi's remarks that were not mentioned in the official readout, such as the passage I highlighted above.

As I introduced in a previous piece, in China, after the official readouts of important activities such as Xi's meetings, inspection tours, or overseas visits are released, mainstream media outlets like People's Daily and Xinhua News Agency often publish "side stories" related to these events, which provide more details about the meetings.

For those unfamiliar with China's context, it’s worth noting that in the past, China built many five- to eight-story residential buildings, which were originally designed without elevators. As residents age, climbing stairs becomes increasingly difficult. Therefore, in recent years, China has been renovating old neighborhoods, including installing elevators.

However, installing an elevator in a residential building requires unanimous consent from all residents, with most households chipping in to cover the costs. Typically, first-floor residents receive compensation for any inconvenience, but hammering out the details -- how much everyone pays and how much is compensated 00 can be quite the hurdle. These challenges often delay elevator projects, requiring community managers to step in frequently to mediate and communicate, striving to untangle the issues and move forward.

That is why Xi referred to community Party secretaries as “小区总理” (prime ministers of the neighborhood), noting that "they have to manage a lot of things, and it’s not easy," as reported by the side story. This reflects Xi's understanding of the challenges that grassroots governance faces in China. In this case, community Party secretaries must be skilled at listening to everyone’s concerns while also possessing strong coordination skills and resilience.

Thursday - Xi joined the discussion of political advisors

“现在，一方面，有了智联网、人工智能，教育的工具和方法会发生变化，学生能力培养会有变化，这些正需要与时俱进地进行改革。另一方面，对于学生的启智、心灵的培养和基本的认知能力、解决问题能力的培养，是不能放松的。基本功还得有。”

Now, on one hand, with the advent of the Artificial Intelligence of Things (AIoT) and artificial intelligence (AI), the tools and methods of education are bound to change, as will the cultivation of students' skills. These changes necessitate reforms that keep pace with the times. On the other hand, it is of great significance and necessity to cultivate students' intellectual enlightenment, their mental development, and their fundamental cognitive and problem-solving abilities. These foundational skills must remain firmly in place."

This remark made by Xi on Thursday were not also included in the official readout but was featured in a side story published by the People's Daily on Saturday about the event. Currently, China has achieved internationally leading progress in some high-tech fields. According to Bloomberg, the next DeepSeek to disrupt the global artificial intelligence industry could also come from China. Such progress has also significantly impacted many aspects of Chinese society. In education, as reflected in Xi's remarks, China aims to ensure that students do not become overly reliant on high technology, emphasizing the cultivation of fundamental cognitive and problem-solving skills.

“有的学校建设得‘高大上’，但好学校要看大师，不光是看大楼。还是要提高质量，内涵式发展，解决好现存的问题。”

"Some schools may be designed to be grand and upscale, but true excellence comes from having great masters, not just impressive buildings. The focus should be on improving quality, bringing out the full potential of the schools, and tackling existing issues."

This remarks by Xi also comes from the People's Daily report. His remarks reminded me of my earlier interview with Shing-Tung Yau, a Fields medallist and now at Beijing’s Tsinghua University. Yau shared with me his views on the importance of “大师”(masters) in advancing China's basic research. A related viewpoint was also shared by Yau in a Global Times report:

"Throughout history, the greatest mathematicians in both the East and the West were not geniuses; they achieved profound knowledge through extensive training and overcoming hardships. Moreover, every successful scholar has been influenced by another “大师” (master) on their path to success."

"Currently, China's biggest issue is not quality but quantity -- there are still not enough masters, which puts us slightly behind the United States and the United Kingdom." Given the current international climate, recruiting top-tier talent has become increasingly challenging. Yau said frankly, "The global situation is quite delicate now. There are many negative portrayals of China in American media. While some American scholars are interested in coming to China, others are hesitant because they lack understanding of China and rely solely on what they hear from U.S. media."

We also interviewed Lu Anhui, a member of the CPPCC National Committee from the technology sector and a professor at the School of Chemical Engineering of Dalian University of Technology. He shared with us the importance of the higher education institutions in China's development strategy.

"Higher education institutions play an important role in building independent knowledge systems and accelerating breakthroughs in key core technologies," Lu said. "To promote Chinese modernization, it is a crucial strategic priority for universities to facilitate the transition of more high-quality scientific and technological achievements from campuses to enterprises and effectively transform research outcomes in laboratories into new quality productive forces."

Friday - Xi attended a meeting of the delegation of the armed forces

实现我军建设“十四五”规划圆满收官

Chinese President Xi Jinping on Friday called for reaching a successful conclusion of the 14th Five-Year Plan (2021-2025) for military development.

......

我军建设“十四五”规划实施4年多来，取得一系列重大成果，同时也面临不少矛盾和问题。

Over the past four-plus years since the implementation of the plan, a series of significant achievements have been made, while there are also many challenges and issues that need to be addressed.

The year of 2027 marks the centennial of the founding of the People's Liberation Army (PLA). China has formulated a three-step development strategy for modernizing national defense and the armed forces -- achieving the centenary objectives of the PLA by 2027, basically realizing the modernization of national defense and the armed forces by 2035, and fully building the armed forces into world-class forces by the mid-21st century.

It was disclosed at the session that China's 2025 defense budget in the central government expenditures will be 1.78 trillion yuan (about 249 billion U.S. dollars), marking a 7.2-percent growth year on year.

Wu Qian, spokesperson for the delegation of the People's Liberation Army and the People's Armed Police Force, explained the rationale behind the defense budget on Sunday during the annual national legislative session.

He said the increased expenditure will be mainly used to develop new-domain forces with new combat capabilities and to enhance systems and capacity for reconnaissance and early warning, joint strikes, battlefield support and integrated logistics support.

The spending will also be put into improving military training under combat conditions and deepening national defense and military reform, Wu said.

Compared to major military powers like the United States, China's defense spending remains relatively low in terms of the spending's share in GDP, its share in national fiscal expenditures, the country's per capita defense spending, and expenditure per service member, he added.

The spokesperson emphasized that China has yet to be completely reunified, and faces one of the most complex peripheral security environments in the world. "The Chinese military faces tough challenges in safeguarding national sovereignty and territorial integrity," Wu said.

I believe that China “facing one of the most complex peripheral security environments in the world“ is an issue that some international readers might overlook. If more people could put themselves in China's shoes and consider global issues from that perspective, China's positions and attitudes on some international affairs might become easier to understand.

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According to the government report, China targets an economic growth of "around 5 percent” in 2025. A more proactive fiscal policy and an appropriately accommodative monetary policy will be adopted, with the ratio of deficit to gross domestic product (GDP) set at around 4 percent, an increase of one percentage point over last year. The country expects to create over 12 million jobs in urban areas and keep the surveyed urban unemployment rate at around 5.5 percent this year.

Domestic demand will be made the main engine and anchor of economic growth, the report said. Ultra-long special treasury bonds totaling 300 billion yuan will be issued to support consumer goods trade-in programs.

The central government expenditures are projected at 4.3545 trillion yuan, an increase of 6.9 percent this year.

The main expenditures are as follows: 64.506 billion yuan on diplomatic endeavors, up 8.4 percent; 1.784665 trillion yuan on national defense, up 7.2 percent; 242.828 billion yuan on public security, up 7.3 percent; 174.443 billion yuan on education, up 5 percent; 398.119 billion yuan on science and technology, up 10 percent; 131.66 billion yuan on stockpiling grain, edible oils, and other materials, up 6.1 percent; and 834.55 billion yuan on debt interest payments, up 10.2 percent.

We have uploaded the Report on the Work of the Government [Chinese] [English], the Report on China's national economic and social development plan [Chinese][English], and the Report on China's central and local budgets [Chinese][English] to Google Drive for you to download and share with others.

Please note that the official Chinese version of the reports will be released by Xinhua News Agency/此报告以本次大会最后审议通过并由新华社公布的文本为准.

Below are the highlights of the government work report delivered by Premier Li today. They are selected by me, focusing mostly on China's economic policies and the government's major tasks in 2025.

Five key relationships in economic work

One notable statement in the government work report highlights the need to properly handle five key relationships in economic efforts, echoing the central theme of a recent article in Qiushi, a flagship magazine of the CPC Central Committee. The article is part of Xi Jinping's remarks on the Chinese economy during the Central Economic Work Conference last December.

Inside China

Xi Outlines Five Key Relationships for China's Economic Development

As the Two Sessions approaches, China watchers worldwide are eager to see how China will outline this year's economic policy priorities. (also an extremely busy week for Chinese reporters like us) On Feb. 28, CPC's flagship journal, Qiushi (求是), published part of Xi Jinping's remarks on the Chinese economy during the…

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a year ago · 10 likes · Fred Gao

The five relationships are

1. 有效市场和有为政府 Between an efficient market and a well-functioning government

2. 总供给和总需求 Between aggregate supply and demand

3. 培育新动能和更新旧动能 Between fostering new growth drivers and upgrading old ones

4. 做优增量和盘活存量 Between optimizing allocation of new resources and making the best use of existing ones

5. 提升质量和做大总量 Between enhancing quality and expanding total output

These five points are crucial for the outside world to understand China's current approach to coordinated economic development.

Growth target and policy coordination

As I predicted in my previous newsletter on the "two sessions" preview, the Chinese government has set this year's economic growth target at around 5 percent. The government work report delivered by Premier Li this morning noted that achieving this year's targets “will not be easy and requires arduous efforts.”

According to Caixin, the "two sessions" are held against a more positive backdrop than the Central Economic Work Conference last December. The macro research team at China International Capital Corporation (CICC) pointed out that investors' sentiment has been influenced by China's recent economic growth and DeepSeek's success. However, considering short-term capital market performance, they noted that the "two sessions" are unlikely to change the outlook, which still anticipates downward pressure on the economy.

After going through the government work report, it seems clear that the authorities are well aware of the challenges ahead, which I believe is crucial for crafting targeted policies to meet this goal as effectively as possible. For instance, the report emphasized the importance of improving policy coordination and heeding the market's voice, which I understand are both positive factors.

出台实施政策要能早则早、宁早勿晚，与各种不确定性抢时间，看准了就一次性给足，提高政策实效。

Policies should be introduced and implemented as soon as possible -- it is better to act early than late, as this will buy valuable time for addressing any uncertainties that may arise. Once we are certain of a policy, we should decisively act with ample force to produce more effective outcomes.

注重倾听市场声音，协同推进政策实施和预期引导，塑造积极的社会预期。

We will heed the market’s voice, make concerted efforts to facilitate policy implementation and guide expectations, and strive to shape positive public expectations.

Deficit ratio

A higher deficit-to-GDP ratio at around 4 percent, an increase of one percentage point over last year. The change echoes an article by Finance Minister Lan Fo'an published on Feb. 21 in People's Daily, in which he explained the rationale behind increasing China's deficit-to-GDP ratio.

提高财政赤字率，加大支出强度、加快支出进度。赤字率是宏观政策的一个重要风向标。根据宏观经济周期性变化，通过提高赤字率，加强逆周期调节，是世界各国通行做法。

We need to set a higher deficit-to-GDP ratio, increase the intensity of spending, and accelerate the process. The fiscal deficit ratio is a key indicator of macroeconomic policy. In response to cyclical changes in the economy, it is a common global practice to raise the deficit ratio in order to strengthen counter-cyclical measures.

今年将统筹考虑宏观调控需要，提高财政赤字率，进一步增加财政总支出规模，为经济发展注入更多动力。同时，财政政策主动靠前发力，加快各项资金下达拨付，尽快形成实际支出。

This year, the Chinese government plans to take a comprehensive approach to macroeconomic regulation by increasing the fiscal deficit ratio and boosting overall fiscal spending to stimulate economic growth. At the same time, fiscal policy will take a more proactive role, expediting fund allocations and disbursements to translate them into actual spending as soon as possible.

New quality productive forces

It comes as no surprise that developing new quality productive forces was once again listed as one of the key tasks in this year's government work report.

Definition of "new quality productive forces" given by Xi — Qiushi

概括地说，新质生产力是创新起主导作用，摆脱传统经济增长方式、生产力发展路径，具有高科技、高效能、高质量特征，符合新发展理念的先进生产力质态。

With innovation playing the leading role, new quality productive forces mean advanced productivity that is freed from traditional economic growth mode and productivity development paths, features high-tech, high efficiency and high quality, and comes in line with the new development philosophy.

Many China watchers believe that the concept is closely tied to China's efforts to achieve technological self-reliance and break through the containment and suppression imposed by certain countries. At a press conference on Monday, Liu Jieyi, spokesperson for the third session of the 14th National Committee of the Chinese People's Political Consultative Conference (CPPCC), also shared some progress in developing new quality productive forces in China.

Liu said that among the 189 industry leaders in the Global Lighthouse Network, an initiative co-founded by the World Economic Forum and McKinsey, China boasts 79, nearly half of which are in traditional industries such as steel and food.

He also explained how the CPPCC has contributed to the development of new quality productive forces.

"Among the proposals of the CPPCC National Committee, promoting the development of new quality productive forces is a key focus. We organized the CPPCC National Committee members and renowned scholars in social sciences across the country to conduct theoretical research on this topic and produced research reports to enhance implementation with concrete measures," he said.

Members of the CPPCC National Committee include those who have work experience on an international scale. Their exposure to global environments renders them particularly attuned to the forefront of technological advancements worldwide, and it is natural for them to contribute to the development of new quality productive forces.

“We closely tracked international cutting-edge breakthroughs and conducted in-depth research at research institutes and enterprises on topics such as the commercialization of scientific and technological achievements, the construction of regional innovation centers, and the development of innovative pharmaceuticals,” said Liu.

Artificial Intelligence (AI)

As I previously predicted, AI is one of the hot topics at this year's "two sessions," likely further fueled by DeepSeek's recent sensational rise. The government work report also includes development plans related to AI, as part of the efforts of developing new quality productive forces.

持续推进“人工智能＋”行动，将数字技术与制造优势、市场优势更好结合起来，支持大模型广泛应用，大力发展智能网联新能源汽车、人工智能手机和电脑、智能机器人等新一代智能终端以及智能制造装备。

Under the AI Plus initiative, we will work to effectively combine digital technologies with China’s manufacturing and market strengths. We will support the extensive application of large-scale AI models and vigorously develop new-generation intelligent terminals and smart manufacturing equipment, including intelligent connected new-energy vehicles, AI-enabled phones and computers, and intelligent robots.

According to the report, the Chinese government plans to drive the development of various industries through AI large models, rather than just focusing on the models themselves.

I interviewed Prof. Xu Hao from the College of Computer Science and Technology at Jilin University about the AI large models in China. He said that AI large models have become as essential as electricity and the internet -- critical infrastructure that will spur the rapid development of technologies like smart vehicles, drones, and humanoid robots. AI is at the core of these innovations, including the low-altitude economy that has received quite a lot of attention from the government recently.

Regarding concerns over the potential rat race as more companies flock into the field, Xu believed that AI presents numerous scientific and technical challenges that no single company can now tackle alone.

"Competition at the current stage is about various players addressing shared problems, each with their own approach and unique positioning in the market," Xu explained. "In my view, this will foster a much healthier ecosystem than if only one company were involved."

Foreign policy

We will stay committed to an independent foreign policy of peace and to the path of peaceful development. We will remain firm in pursuing a mutually beneficial strategy of opening up, oppose hegemonism and power politics, oppose unilateralism and protectionism in all forms, and uphold international fairness and justice.

The government work report briefly touches on foreign affairs. Those interested in more comprehensive details of China's foreign policy should attend the dedicated press conference scheduled for March 7, which I will also be attending as a journalist.

In my previous newsletter on the "two sessions," I said this year in the press conference, don't be surprised if a Chinese diplomat invokes Chinese poems or proverbs to articulate China’s diplomatic philosophy.

Just this Tuesday, Chinese Ambassador to the United States Xie Feng quoted a poem of Chairman Mao Zedong to share his views on U.S. tariff in an interview with 玉渊谭天 Yuyuan Tantian, a social media account affiliated with China Media Group, at the Great Hall of the People during the “two sessions.”

Below is the translation provided by DeepSeek:

”暮色苍茫看劲松，乱云飞渡仍从容。“

"In the thickening dusk, the rugged pine holds fast; chaotic clouds race by -- unshaken, calm, steadfast."

"On the one hand, we must soberly confront the grave challenges confronting China-U.S. relations," Xie said. "On the other hand, we should remain confident in our country's development and the great rejuvenation of the Chinese nation. History teaches us this truth: whether tariff wars or trade wars, what begins as attempts to bleed others ultimately ends in self-inflicted wounds."

The "two sessions" refer to the annual session of the National People's Congress (NPC), China's top legislature, and the annual session of the Chinese People's Political Consultative Conference (CPPCC) National Committee, China's top political advisory body.

This year, the CPPCC National Committee session will commence on Tuesday, March 4, followed by the NPC session on Wednesday, March 5. Held concurrently in Beijing, the "two sessions" are expected to span approximately one week.

During this critical period, the Chinese premier, top legislator, top political advisor, chief justice, and top procurator will present work reports. Chinese legislators and political advisors will put forth proposals and suggestions aimed at addressing national development priorities.

Ministers from various State Council departments will also engage with the public through interviews and press conferences, clarifying policies and responding to pressing concerns. Last year, for instance, 14 department leaders fielded 28 questions during the ministers' passage, while the NPC held three major press conferences, focusing on diplomacy, the economy, and livelihood issues, respectively.

The "two sessions" serve as a critical window into China’s policy direction for the coming year. The decisions made here will not only shape the lives of 1.4 billion Chinese citizens but also have far-reaching implications for global trends and dynamics.

So, what should you watch for during this year's "two sessions"? Below, I’ve highlighted five key areas that deserve your attention:

GDP growth target

In 2024, the annual government work report set a GDP growth target of "around 5 percent", a goal that was successfully achieved, thanks in large part to a series of milestone macroeconomic measures introduced in September. (China's GDP in 2024 grew by 5 percent compared to 2023.)

Many analysts predict that China will set a similar growth target for 2025. This expectation is reinforced by the fact that in January 2025, 31 Chinese provincial-level regions held their local "two sessions" and announced their respective growth targets for the year. Notably, 30 regions set their growth targets at "around 5 percent" or higher o with the weighted average growth target across all 31 regions reaching 5.3 percent.

GDP growth serves as a cornerstone metric with profound and wide-ranging significance. Whether it’s achieving the goals of stabilizing employment, preventing risks, improving livelihoods, or boosting confidence, or realizing China’s broader vision of basically realizing socialist modernization by 2035, or even gaining strategic leverage in global power dynamics, a certain level of economic growth is essential to support these objectives.

Despite the challenges China's economy has faced in recent years during its structural transformation, the country still contributed nearly 30 percent of global economic growth in 2024, making it the largest source of growth for the world economy. As such, the GDP growth target set in this year’s government work report remains one of the most closely watched figures during the "two sessions."

The GDP growth target is also closely tied to other policy objectives. For instance, the Central Economic Work Conference held in December 2024, which set the tone for this year’s economic development, emphasized the need to "increase residents' income in step with economic growth," reflecting policymakers' determination to better align macroeconomic goals with the lived experiences of residents.

Economic policies

Considering the size of China's economy, a GDP growth target of "around 5 percent" is by no means a low bar. Achieving this target will likely require more direct efforts and targeted policy measures to stimulate economic activity. If the GDP target is set at around 5 percent, the government work report is expected to announce incremental policy measures to ensure the goal is met.

China has already signaled a shift in its macroeconomic stance. At December’s Central Economic Work Conference, policymakers pledged to implement more proactive and impactful macro policies in 2025, notably transitioning the monetary policy from "稳健" (prudent) to "适度宽松" (moderately loose), marking the most significant change in 14 years. Additionally, fiscal policy is described as "更加积极" (more proactive), with the addition of the term "更加" (more) to emphasize its intensified nature.

Han Wenxiu, executive deputy director of the Office of the Central Committee for Financial and Economic Affairs, highlighted that the new policy proposals carry significant weight, with specific measures set to be unveiled during this year’s "two sessions."

In an article published by People’s Daily on December 31, 2024, Han provided insights into China’s economic roadmap. He openly acknowledged the challenges facing the Chinese economy, noting that domestic demand, particularly consumer spending, remained insufficient, and some enterprises faced operational difficulties. Employment pressures persisted and risks in certain sectors continued to be a concern. On the international front, geopolitical conflicts and rising global protectionism added to the complexities faced by China's economy.

Among the nine priorities outlined in the Central Economic Work Conference, boosting consumption came as the first, indicating that China has prioritized domestic demand at the top of its economic agenda. According to the meeting, the large-scale equipment upgrades and consumer goods trade-in programs should be promoted with greater intensity and scope in 2025.

In 2024, China's trade-in programs have boosted sales of bulk durable consumer goods by over 1.3 trillion yuan (about 181 billion U.S. dollars). In the new year, the extent to which the government will further strengthen the trade-in policy are expected to be revealed during the "two sessions."

While concerns over local government debts persist, China moved decisively to contain risks in the area last year, rolling out a series of debt relief measures. Unveiled in November, the debt-relief package reflects a shift in the country's efforts from reactive crisis management to proactive and systemic resolution, and a transition from dual-track oversight of explicit and implicit debts to transparent and standardized management of all debts.

According to Finance Minister Lan Fo'an, in 2025, China will actively use the room for a higher deficit, increase the issuance of local government special-purpose bonds, continue to issue ultra-long special treasury bonds, and increase transfer payments from the central government to local governments.

Additionally, Han noted in his article that "rat-race competition" in some industries has intensified in recent years, leading to falling product prices, operational difficulties for businesses, and industry-wide challenges. To address this issue, the country will promote industry mergers and restructuring, encouraging "race-to-the-top competition" while curbing "race-to-the-bottom" practices. Whether specific measures related to this will be announced during the "two sessions" is another policy area worth watching.

Chinese leaders in two sessions

During the upcoming "two sessions," Chinese leaders will participate in the deliberations of the NPC delegations, and the joint group meetings of the CPPCC National Committee. The speeches delivered by members of the Standing Committee of the Political Bureau of the CPC Central Committee during these group activities often reveal the central leadership's strategic thinking for the year. Their interactions with NPC deputies and CPPCC National Committee members also serve as a window for observing how the central leadership stays informed about grassroots conditions.

Chinese President Xi Jinping, who is also a deputy of the delegation of Jiangsu Province, will take part in a deliberation with his fellow deputies at the third session of the 14th NPC. Based on his participation in recent years, Xi, as chairman of the Central Military Commission, is also expected to attend a meeting of the delegation from the armed forces. In addition, Xi typically meets with national political advisors from various "界别" (sectors), representing different areas of expertise, party affiliations and social groups. (The 14th CPPCC National Committee has organized itself into 34 sectors)

Xi Jinping takes part in a deliberation with his fellow deputies from the delegation of Jiangsu Province at the second session of the 14th National People's Congress (NPC) in Beijing, capital of China, March 5, 2024.

During these meetings, Xi interacted with Chinese national legislators and political advisors. His remarks in these exchanges often reflect what he considers to be the most important issues for China's development. By interacting with representatives from grassroots levels, he gains a deeper understanding of developments in various areas related to his interests. Sometimes, he also introduces new concepts during these occasions.

For instance, at the "two sessions" in 2024, during a meeting with representatives from the armed forces, Xi introduced the concept of "新质战斗力" (new quality combat capabilities), highlighting its significance for China's defense strategy.

In China, after the official readouts of important activities such as Xi's meetings, inspection tours, or overseas visits are released, mainstream media outlets like People's Daily and Xinhua News Agency often publish "side stories" related to these events, which provide more details about the meetings.

For example, after the release of the readout for Xi’s recent meeting with representatives of Chinese private entrepreneurs, Xinhua published a side story that included a remark on the importance of enterprises being focused on their core business made by Xi during the meeting that was not mentioned in the official readout:

“我在福建和浙江工作时，就很认同当地一些民营企业立足实业、聚焦主业、不断做大做强的做法。这两个地方的服装鞋帽企业比较多，现在有的已经引领国际潮流了，很重要的原因就是几十年心无旁骛，一以贯之做这一行，从开始的来料加工到创立自己的品牌，现在成长为世界知名企业。”

“When I worked in Fujian and Zhejiang, I strongly identified with the approach of some local private enterprises that focus on their core business and continuously strive to grow stronger. These two regions have many apparel and footwear enterprises, some of which now lead international trends. A key reason for this success is their decades of focused dedication to their industry, starting from processing materials to creating their own brands, now evolving into globally recognized enterprises.”

Additionally, People's Daily published a similar piece, which included comments from entrepreneurs at the meeting that were not included in the official readout. For instance, Ren Zhengfei, the founder of Huawei, told Xi:

我们曾经“缺芯少魂”的忧虑已经减弱了，“我坚信，一个更伟大的中国将加速崛起。”

Our concerns about being “lacking in chips” have diminished. “I firmly believe that a greater China will rise even more rapidly."

During the "two sessions" of recent years, I have always been quick to publish these details, which may easily be overlooked by overseas observers. This year, I will continue to track these aspects and report on them in Beijing Scroll in a timely manner.

Foreign minister's press conference

In previous years, the premier’s press conference following the conclusion of the "two sessions" was typically one of the most anticipated highlights, drawing significant attention from both domestic and international audiences. However, last year, no such press conference was held after the NPC session, and the a spokesperson of the NPC announced that "barring exceptional circumstances, premier press conferences will not be scheduled during subsequent years of the 14th NPC." (The term of the 14th NPC runs from 2023 to 2027.)

This year, Chinese Foreign Minister Wang Yi’s press conference will undoubtedly be one of the most closely watched press conferences during the "two sessions." This is especially significant as it comes shortly after the inauguration of the "Trump 2.0" administration in the United States. The themes of the foreign minister’s press conference are usually closely tied to China’s foreign policy and international relations, making it a critical opportunity to observe the latest developments in China’s diplomatic strategy, including its relations with the United States, Europe, Russia, and the Global South.

At last year’s press conference, Wang answered 21 questions from Chinese and international media in approximately 90 minutes.

During a session at the recently-held Munich Security Conference, Wang cited a quote from a popular martial arts novel to illustrate China's position in handling its ties with the United States.

"他强任他强，清风拂山岗；他横任他横，明月照大江。"

"Let the strong do as they will; we remain as unperturbed as the gentle breeze caresses the hills. Let the fears act as they may; we maintain our poise as the bright moon illuminates the river."

Acknowledging the difficulty of translating the quote, Wang, also a member of the Political Bureau of the Communist Party of China Central Committee, demonstrated his sense of humor by recommending that journalists seek assistance from DeepSeek. Xinhua has published an explainer on this quote.

Explainer: How to understand Chinese FM's citation from martial arts quotation in Munich -- Xinhua

This is not the first time a Chinese saying cited by the Chinese top diplomat has sparked discussions about translation. In a phone call with U.S. Secretary of State Marco Rubio last month, Wang told Rubio to "hao zi wei zhi," a Chinese set phrase commonly used to convey a message of warning.

International media outlets gave various translations for the phrase, including "conduct yourself well," "conduct yourself properly," and even "take good care of yourself."

It is a common practice for the Chinese foreign minister to invoke traditional Chinese proverbs when discussing China-U.S. relations. At last year's Munich Security Conference, for example, Wang quoted an ancient Chinese adage during his meeting with then U.S. Secretary of State Antony Blinken.

This year in the press conference, I would not be surprised if Wang Yi once again invokes traditional Chinese proverbs to articulate China’s diplomatic philosophy. If the evolving dynamics of U.S.-Russia relations have left you eager to understand China’s current foreign policy direction, Pekingnology’s coverage of Wang’s recent engagements with important people including Graham Allison, the Harvard professor who coined the term “Thucydides trap”, might offer some valuable insights.

Pekingnology

Wang Yi meets Allison, Merz, Kallas, Baerbock, Werthein, Rutte, Scholz, Barro, Albares, & Sa'ar in Munich

The U.S. State Department’s Office of the Spokesperson constantly sends out English-language press releases via email en masse. No one in the world apparently does that with regard to China, despite the world’s second-largest economy’s importance. But there is apparently tremendous demand. So I’ll just play that role today, following…

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a year ago · 16 likes · Zichen Wang

DeepSeek and tech innovation

The influence of DeepSeek, China’s generative artificial intelligence (AI) chatbot, extends far beyond its mention in Wang Yi’s speech at the Munich Security Conference. Over the past month, DeepSeek has sent shockwaves through the global AI industry, capital markets, and numerous sectors, thanks to its impressive inference performance, cost-effectiveness, and open-source advantages.

Domestically, companies such as Tencent, Baidu, and BYD have begun integrating DeepSeek's model into their products. Some local governments have also announced collaborations with the DeepSeek AI model to enhance public services, while others have organized training programs to help officials and business professionals better understand the development and applications of DeepSeek and other AI technologies.

Without a doubt, technological innovation will be a key focus during this year’s "two sessions," with the AI industry very likely to take center stage.

In fact, AI has already emerged as one of the hottest topics at many of this year’s provincial-level "two sessions." Journalists from the China Youth Daily used a large model to extract high-frequency terms related to technology policies from the local government work reports of 31 provinces and found that “人工智能” (AI) ranked second, just behind "科技创新“ (technological innovation). Many of the AI-related plans focus on building innovation platforms, promoting deeper industry integration, and improving policy frameworks.

In recent years, China has made significant strides in key technological fields, with a group of six Hangzhou-based startups known as the "Six Little Dragons," including DeepSeek, exemplifying the nation's growing prowess in a surprising momentum. The others are robotics firms Unitree Robotics, video game studio Game Science, brain-machine interface innovator BrainCo, and spatial design firm Manycore.

Such progress has bolstered national confidence and granted the Chinese government greater maneuverability in the face of the U.S. suppression policy. The Economist magazine wrote that the United States tried to prevent China from catching up in the field of AI, and that China's recent progress is "upending the industry and embarrassing American policymakers." The success of the Chinese models, combined with industry-wide changes, could turn the economics of AI on its head.

It’s important to note that the rise of innovations like DeepSeek reflects not just China's commitment to leading in technological advancements, but also its broader strategic focus on talent cultivation, innovation-friendly environments, business environment improvements, and the nurturing of non-public investments. These elements are expected to be underscored in the government’s agenda, and are likely to draw attention during the "two sessions."

Additionally, the NPC and CPPCC sessions provide a crucial platform for lawmakers and political advisors to offer suggestions and foster broad consensus on national development. Some of the deputies and committee members are corporate executives and leading researchers. What AI-related proposals and suggestions they will present this year is certain to be a major point of interest for China watchers.

Over the past week, I had the opportunity to speak with three of these local journalists of Xinhua from north China's Hebei Province, east China's Jiangsu Province, and northwest China's Gansu Province, and asked them the same three key questions as follows:

1. What are some of the standout achievements in your province in 2024?

2. What are the most anticipated developments in your province for 2025?

3. What are the biggest challenges your province will face in 2025?

Alongside their responses, I’ve also added some of my own observations based on what I’ve learned about these provinces. While these journalists' views do not represent the position of Xinhua, I personally find their insights enlightening and valuable, particularly for those seeking a broader perspective on the country.

Hebei Province

Population (2023): 73.93 million

GDP (2023): 4.39 trillion yuan (about 600 billion U.S. dollars)

Seat: Shijiazhuang

Journalist: Yue Wenting, economic journalist based in Hebei

1. What are some of the standout achievements in Hebei Province in 2024?

Yue: Hebei is a traditional resource-rich and energy-intensive province. It has made new breakthroughs in promoting comprehensive green transformation. The installed capacity of wind and solar power in Hebei has exceeded 100 million kilowatts, accounting for more than 60 percent of the total installed capacity, ranking among the top in the country.

Moreover, according to the China Comprehensive Computing Power Index (2024) published by the China Academy of Information and Communications Technology, Hebei ranks first in the country for comprehensive computing power. Within the province, the cities of Langfang and Zhangjiakou rank first and second, respectively, in the computing power index at the municipal level.

In addition, the area has entered a phase of large-scale development while also relieving Beijing of functions non-essential to its role as China's capital.

On Oct. 14, 2024, the office building of China Satellite Network Group Co., Ltd. in the Xiong'an New Area was officially put into use, marking the full relocation of the first centrally administered state-owned enterprise to settle in the region.

Nearly 300 centrally administered SOEs have set up offices in Xiong'an, including China Sinochem and China Huaneng Group. Construction is also speeding up for Xiong'an campuses of universities such as Beijing Jiaotong University, along with the Xiong'an branch of Peking University People's Hospital.

This aerial photo taken on June 2, 2023 shows the Xiong'an Railway Station in Xiong'an New Area, north China's Hebei Province.

2. What are the most anticipated developments in Hebei Province for 2025?

Yue: In recent years, Hebei has placed a strong emphasis on the development of industrial clusters, and has successfully established 107 key specialized industrial clusters. By the end of 2023, the total revenue generated by these clusters surpassed 4 trillion yuan, creating a unique landscape where every county in the province hosts its own industrial cluster.

According to the Hebei provincial government, by 2025, it aims to establish five industrial internet platforms dedicated to "共享智造 shared smart manufacturing," cultivate 10 leading "shared" enterprises, and set up 15 "shared" factories or workshops to this end.

The production model of "shared smart manufacturing," rooted in the sharing economy, seeks to optimize resource allocation and enhance productivity. It is expected to elevate Hebei's industrial clusters, fostering efficient and coordinated growth.

I have noticed that the cashmere industry in Qinghe, known as the “Cashmere Capital,” is catering to customers’ personalized needs through shared workshops. Similarly, the shared robot factories in Tangshan are enabling enterprises to share resources, reduce costs, and boost efficiency.

In 2025, more "shared" factories and workshops are expected to emerge across Hebei, and I look forward to reporting on them.

3. What are the biggest challenges Hebei Province will face in 2025?

Yue: Hebei is a major steel-producing province. In 2024, during my interviews with several steel enterprises in the province, it was evident that the steel industry has faced persistent pressure in recent years. Industry insiders have noted that the situation will become even more difficult by 2025, with some companies potentially struggling to survive. Similar challenges are also affecting other traditional sectors, such as apparel and chemicals.

As mentioned, Hebei needs to address the pressure of transforming its traditional industries. Sectors like steel and chemicals make up a large proportion of the province's economy, and urgently need to upgrade to more advanced, intelligent, and environmentally sustainable models.

Moreover, while Hebei has made significant progress in strengthening its innovation capabilities in recent years, there is still a noticeable gap compared to more developed regions. The province must further boost R&D investment, enhance innovation platforms, foster and scale up innovative enterprises, improve independent innovation capacity, break through key core technologies, and accelerate the conversion of scientific research results into industrial applications.

Context (added by editor):

In recent years, Hebei Province has been dedicated to three major events, namely the 2022 Beijing Winter Olympics, the construction of the Xiong'an New Area, and the coordinated development of the Beijing-Tianjin-Hebei region, also known as "Jing-Jin-Ji." 2024 marked the 10th anniversary of the launch of this regional coordinated development as a major national strategy.

Jiangsu Province

Population (2023): 85.26 million

GDP (2023): 12.82 trillion yuan

Seat: Nanjing

Journalist: Yang Shaogong, economic journalist based in Jiangsu

1. What are some of the standout achievements in Jiangsu Province in 2024?

Yang: The most remarkable achievement in Jiangsu has been its success in stabilizing economic growth, which has played a crucial role in helping the country meet its national economic objectives.

This is clearly reflected in the statistics. In the first three quarters, Jiangsu’s Gross Regional Product (GRP) reached 9.77 trillion yuan, marking a year-on-year growth of 5.7 percent, which is 0.9 percentage points higher than the national average. This growth rate was the highest among major economic provinces.

High-tech industries now account for 50.8 percent of the province's industrial output above a designated size. Besides, foreign direct investment amounted to 16.99 billion U.S. dollars, maintaining Jiangsu’s position as the top recipient in the country.

A defining feature of Jiangsu’s development is the deep integration of technological and industrial innovation, setting it apart from other regions in China. With its large and high-quality manufacturing sector, the province has a strong reliance on technological advancements and offers a rich environment for the application of new technologies.

Moreover, Jiangsu has achieved a historic milestone in its agricultural production, which is of great significance as it supports the province’s economic resilience and sustainable growth.

This year, the province’s grain output reached 76.2 billion jin (approximately 38.1 billion kilograms or 84 billion pounds), setting a new record and maintaining a steady output above 70 billion jin for 11 consecutive years. This stable production is expected to continue at this level in the coming year, ensuring food security and providing a solid foundation for Jiangsu’s consistent development.

An aerial drone photo taken on Aug. 30, 2024 shows "the Gate of the Orient," a landmark complex at the Suzhou Industrial Park in Suzhou, east China's Jiangsu Province.

2. What are the most anticipated developments in Jiangsu Province for 2025?

Yang: Several developments in Jiangsu for 2025 are highly anticipated. Notably, the province will begin to progressively relax its household registration (hukou) restrictions, which is closely in line with the objectives set out in the third plenum of the 20th Communist Party of China (CPC) Central Committee to improve urban-rural integration and social security mechanisms. The reform of the hukou system is vital, as it allows for the free movement of people and other resources, thereby unlocking greater economic vitality and providing tangible benefits and a stronger sense of well-being to those migrating to urban areas.

The completion of five new cross-river passageways in Jiangsu next year is of great importance. These passageways are crucial because Jiangsu is divided by the Yangtze River into two distinct regions: the northern and southern parts of the province.

From the earliest Jiangyin Bridge on the Beijing-Shanghai Expressway to the more recent Wufengshan Yangtze River Bridge, which integrates both road and rail, all existing bridges have approached capacity very quickly. The construction of these new links is therefore a highly anticipated and critical development for Jiangsu’s ongoing growth and improved connectivity, both within the province and with the rest of the nation.

Aerial photo taken on Oct. 13, 2020 shows Wufengshan Yangtze River Bridge in east China's Jiangsu Province.

Jiangsu has the highest density of high-speed rail in China, yet its network continues to expand. Over the next three years, the province plans to add five more high-speed rail lines. This ongoing development is driven by the need to meet growing demand for efficient, high-quality transportation and to support future economic and technological growth, particularly in county-level cities.

Without convenient high-speed rail access, many research professionals are hesitant to relocate to these areas. Recognizing the importance of attracting talent to support its thriving county-level economies, Jiangsu is actively addressing this challenge through its transportation expansion.

3. What are the biggest challenges Jiangsu Province will face in 2025?

Yang: The most significant challenge remains sustaining economic growth while simultaneously improving the sense of well-being among the population. As previously mentioned, a fundamental shift is needed in the government’s approach to investment. The focus should move from relying heavily on attracting investment for large-scale projects to using public funds to build high-quality infrastructure in areas such as elderly care, healthcare, and education.

By addressing the basic concerns of residents, Jiangsu can truly enhance their quality of life, thereby unleashing greater consumer spending power. This challenge is not unique to Jiangsu; it is a nationwide issue.

Context (added by editor): Jiangsu has been at the forefront of major reforms and initiatives, setting a benchmark for many other provinces. It has served as a pioneering region for the Beautiful China Initiative and has set a distinguished example in advancing Chinese modernization, while also in implementing the reform objectives articulated at the third plenum of the 20th CPC Central Committee, such as building a high-standard socialist market economy, promoting high-quality economic development, and supporting all-round innovation.

Gansu Province

Population (2023): 24.65 million

GDP (2023): 1.19 trillion yuan

Seat: Lanzhou

Journalist: Zhang Yujie, economic journalist based in Gansu

1. What are some of the standout achievements in Gansu Province in 2024?

Zhang: Gansu, as a representative inland province in northwest China, faces challenges in terms of economic and social development. The province's industrial sector remains largely centered on primary processing, with industries characterized by short value chains, low added value, and significant development pressures.

Despite these challenges, Gansu possesses distinct advantages, including abundant mineral resources, a solid industrial base, and a robust scientific and technological infrastructure. Gansu is the first province in northwest China to establish modern industry in the late 19th century. Key institutions such as the Northwest Institute of Eco-Environment and Resources (NIEER) of Chinese Academy of Sciences, Lanzhou Institute of Physics of China Academy of Space Technology, and Lanzhou University further strengthened the province’s capacity for innovation and development.

In 2024, the Lanzhou Petrochemical Company, a regional subsidiary of China's largest natural gas producer and supplier CNPC, passed an internal review of a planned investment of over 24 billion yuan for the million-ton ethylene transformation project. The total investment for this project even exceeds the company's existing fixed assets.

In recent years, Gansu made significant strides in advancing new industrialization, which had a profound impact on its economic development. In the first three quarters of 2024, Gansu's GDP growth rate increased by 6 percent year-on-year, surpassing the national growth rate by 1.2 percentage points, ranking second in the country. This marks the 11th consecutive quarter that Gansu's GDP growth has outpaced the national average.

2. What are the most anticipated developments in Gansu Province for 2025?

Zhang: In 2025, I have high expectations for technological innovation in Gansu. I hope the province could endeavor to translate more scientific research into production benefits by taking full advantage of the research institutes and platforms in the region such as the Lanzhou-Baiyin Science and Technology Innovation Reform Experimental Zone.

An aerial drone photo taken on Sept. 23, 2024 shows a view along the Yellow River in Lanzhou, northwest China's Gansu Province.

I also look forward to Gansu making further progress in the ecological protection and high-quality development of the Yellow River Basin.

Despite accounting for only 2 percent of the country's total water runoff, the Yellow River, revered as China's "Mother River" and a cradle of Chinese civilization, plays a vital role in ensuring water security for 12 percent of the population and 17 percent of the country’s farmland. It also serves as the primary water source for more than 50 large and medium-sized cities.

Gansu is a key water conservation and recharge area in the upper reaches of the Yellow River. About 60 percent of the river's water comes from the section above its capital, Lanzhou, and nearly one-fifth of the Yellow River flows through Gansu, spanning over 900 kilometers.

Since 2021, Gansu has effectively improved the water conservation and recharge capacity of the upper reaches through an integrated protection and restoration project for its mountains, waters, forests, lakes, grasslands and sand resources in the upper Yellow River Basin.

However, some deep-rooted contradictions remain unresolved. For instance, the overall scarcity of water resources in the basin contrasts with the rising demand for water due to economic and social development.

I hope the《中共甘肃省委关于全面推动黄河流域生态保护和高质量发展的决定（讨论稿）》Decision on Fully Promoting Ecological Protection and High-Quality Development of the Yellow River Basin (Draft for Discussion), approved at the Seventh Plenary Session of the 14th Committee of the Gansu Provincial Committee of the CPC on Dec. 21, will help resolve these deeper contradictions. This will not only continue to improve the river’s ecological environment but also better drive economic development along the Yellow River, reducing regional disparities and promoting high-quality growth.

3. What are the biggest challenges Gansu Province will face in 2025?

Zhang: Gansu faces significant challenges in narrowing the gap with more developed regions. China’s vast geography is marked by growing regional disparities, and while the western regions, Gansu included, are vital for strategic and ecological security, they remain economically underdeveloped. Gansu, in particular, struggles with attracting talent and investment, which hinders its ability to catch up with more prosperous areas. If these regional disparities, especially in the economic sector, continue to widen, it could pose long-term challenges for sustainable development in the region.

A major obstacle for Gansu is its reliance on traditional industries as the primary drivers of economic growth. The province remains heavily dependent on mineral resources and petrochemicals, with limited progress in cultivating emerging industries or fostering innovation.

Context (added by editor):

Located in the northwest of the province, on the edge of the Taklamakan Desert, Dunhuang is the region's most renowned historical city. To the southeast of Dunhuang lies the Mogao Grottoes, home to the world’s largest, most richly adorned, and longest-used treasure trove of Buddhist art. In 1987, the site was inscribed on the UNESCO World Heritage List.

Picture from Shanghai Daily: Murals of Cave No. 112, Middle Tang Dynasty (781-847)

For over two thousand years, Gansu has held a strategic position along the Silk Road, serving as a crucial link between China and Central Asia. Traders and travelers journeying in and out of China have historically passed through the narrow 1,200-kilometer strip of land in central Gansu, dotted with oasis towns and military outposts. This vital route, known as the 河西走廊 Hexi Corridor, has long been one of the most important passages of the ancient Silk Road.

A camel caravan is seen at sunset in a desert in Zhangye, northwest China's Gansu Province, June 14, 2015.

Summary:

In his New Year message, Xi began by summarizing the highlights of China's economic development, emphasizing the progress in fostering new quality productive forces across various regions. He also shared observations from his domestic visits and highlighted notable achievements in improving people's livelihoods. China's advancements in sports, military development, and disaster response have all been touched upon.

On international affairs, Xi began by discussing China's cooperation with the Global South and referenced key engagements such as the Beijing Summit of the Forum on China-Africa Cooperation, the Shanghai Cooperation Organization, BRICS, APEC, and G20. He expressed his aspiration to work with all nations to create a better future for the world.

Xi's address also included reflections on significant events, such as the 75th anniversary of the founding of New China, the successful convening of the third plenary session of the 20th Central Committee of the Communist Party of China, and the 25th anniversary of Macau's return to the motherland.

Looking ahead to 2025, Xi emphasized that challenges and pressure can be overcome through hard work. He encouraged everyone to remain confident and optimistic about the future.

Details:

当前经济运行面临一些新情况，有外部环境不确定性的挑战，有新旧动能转换的压力，但这些经过努力是可以克服的。我们从来都是在风雨洗礼中成长、在历经考验中壮大，大家要充满信心。

The Chinese economy now faces some new conditions, including challenges of uncertainties in the external environment and pressure of transformation from old growth drivers into new ones. But we can prevail with our hard work. As always, we grow in the wind and rain, and we get stronger through hard times. We must be confident.

This part reminds me of a noteworthy article written by Han Wenxiu, executive deputy director of the Office of the Central Committee for Financial and Economic Affairs. Han's article was published in the People's Daily earlier today, providing insights into China's economic roadmap for 2025.

It is noteworthy that Han's analysis doesn't shy away from acknowledging the challenges faced by the Chinese economy:

认识形势要坚持“两点论”，讲求辩证法。当前，我国经济运行仍面临一些困难挑战，主要是：国内需求特别是消费需求不足，部分企业生产经营困难，群众就业增收面临压力，一些领域风险隐患仍然较多；从国际看，地缘政治冲突加剧，全球保护主义上升，外部环境变化带来的不利影响加深。

In analyzing the situation, one must adhere to the "two-point theory" and employ dialectical reasoning. At present, China's economy still faces some challenges. Domestic demand, particularly consumer spending, remained insufficient, and some enterprises faced operational difficulties. Employment pressures persisted and risks in certain sectors continued to be a concern. On the international front, geopolitical conflicts and rising global protectionism added to the complexities faced by China's economy.

我们更要看到，我国经济发展基础稳、优势多、韧性强、潜能大，长期向好的支撑条件和基本趋势没有变，要通过改革发力、政策给力，把发展潜力充分释放出来，把各方面积极因素转化为发展实绩。

Despite these challenges, it should be noted that China's economic fundamentals remain strong, with significant advantages, resilience and potential for growth. The long-term positive trends supporting China's development remain unchanged. It is crucial to leverage reforms and impactful policies to fully unleash China's development potential and transform positive factors from all areas into tangible achievements.

In addition, at today's gathering held by China's top political advisory body to usher in the new year, Xi described 2024 as a year of extraordinary development and said that China's GDP is expected to grow by around 5 percent in 2024. He also emphasized that China will implement more proactive and effective macroeconomic policies in 2025.

For a detailed overview of China's economic highlights in 2024, check a recent newsletter from Peking Ensight, which elaborates on key areas such as consumption, foreign investment, the property market, and green development.

Peking Ensight

China 2024: Resilience, Recovery, and New Economic Frontiers

China's economy in 2024 demonstrated remarkable resilience and adaptability amid a complex domestic and global landscape…

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a year ago · 3 likes · PekingEnsight and Wen W.

在澳门回归祖国25周年之际，我再到濠江之畔，新发展新变化令人欣喜。我们将坚定不移贯彻“一国两制”方针，保持香港、澳门长期繁荣稳定。

On the eve of the 25th anniversary of Macao's return to the motherland, I visited the city again, and I was gratified to see the new progress and changes there. We will unswervingly implement the policy of One Country, Two Systems to maintain long-term prosperity and stability in Hong Kong and Macao.

As the "crown jewel" of China's "one country, two systems" policy and the richest city in Asia, many people are wondering where Macao is heading next. A clue may lie in Xi's speech at Macao Special Administrative Region (SAR)'s 25th anniversary ceremony on Dec. 20, where he outlined "four hopes" for the SAR.

The first and most important hope was to promote Macao's "appropriate economic diversification," with a focus on the Guangdong-Macao In-Depth Cooperation Zone in Hengqin, which Xi also visited this time. This aligns with a recent article by Prof. Zheng Yongnian, who argues that Macao's future lies in Hengqin. Yifei wrote a newsletter expanding on Zheng's article, delving deeper into the implications of Hengqin's role in Macao's future.

China Kaleidoscope

Macao's future lies in Hengqin, says Zheng Yongnian

Good evening! It's Yifei here. Hope you had a fantastic weekend…

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a year ago · 2 likes · Yifei SHI

两岸同胞一家亲，谁也无法割断我们的血脉亲情，谁也不能阻挡祖国统一的历史大势！

We Chinese on both sides of the Taiwan Strait belong to one and the same family. No one can ever sever the bond of kinship between us, and no one can ever stop China's reunification, a trend of the times.

In last year’s New Year message, Xi’s remarks on Taiwan stated: "China will surely be reunified, and all Chinese on both sides of the Taiwan Strait should be bound by a common sense of purpose and share in the glory of the rejuvenation of the Chinese nation."

It is evident that China's commitment to national reunification remains resolute and unyielding. On Dec. 25, addressing a press conference, Chen Binhua, a spokesperson for the State Council Taiwan Affairs Office, said that the implementation of the "one country, two systems" in Taiwan would fully take into account the island's realities, the views and proposals of people from all walks of life on both sides of the Taiwan Strait, as well as the interests and sentiments of Taiwan compatriots.

"We believe that the people of Taiwan will develop a better understanding of the 'one country, two systems,'" Chen said, adding that the "two systems" solution to the Taiwan question will play its full role while compatriots on both sides work together toward peaceful reunification.

世界百年变局加速演进，需要以宽广胸襟超越隔阂冲突，以博大情怀关照人类命运。中国愿同各国一道，做友好合作的践行者、文明互鉴的推动者、构建人类命运共同体的参与者，共同开创世界的美好未来。

As changes unseen in a century accelerate across the world, it is important to rise above estrangement and conflict with a broad vision, and care for the future of humanity with great passion. China will work with all countries to promote friendship and cooperation, enhance mutual learning among different cultures, and build a community with a shared future for mankind. We must jointly create a better future for the world.

Amid a year marked by a multitude of significant international events, I believe many China watchers are closely analyzing Xi's New Year message, trying to read the tea leaves for China's foreign policy in 2025, particularly regarding China-U.S. Relations. However, such addresses typically do not mention specific countries by name. Notably, just yesterday, President Xi sent a message of condolence to U.S. President Joe Biden over the passing of former U.S. President Jimmy Carter.

Xi extends condolences over passing of former U.S. President Jimmy Carter -- MOFA

Noting that the China-U.S. relationship is one of the most important bilateral ties in the world, Xi said that China is ready to work with the U.S. side to focus on the fundamental interests of their people and meet the common expectations of the international community, and advance China-U.S. relations along the right track of sound, stable and sustainable development.

Xi called Carter a promoter and decision-maker in the establishment of China-U.S. diplomatic relations, noting that the late U.S. leader had long contributed to the development of bilateral ties, as well as the friendly exchanges and cooperation between the two countries.

Xinhua Commentary: Remember Jimmy Carter, cherish his legacy

Carter's contributions to U.S.-China relations and his legacy deserve remembering and cherishing. History has shown that cooperation between China and the United States benefits the two peoples, as well as world peace, stability and development.

As Wednesday marks the 46th anniversary of the establishment of China-U.S. diplomatic ties, it is hoped that Carter's legacy will inspire more people in both countries to enhance friendship and promote practical cooperation, so as to guarantee a sound, stable and sustainable bilateral relationship.

Earlier today, Xinhua released a commentary on the passing of Jimmy Carter. For the Chinese people, Carter will be remembered for his historic contributions to the normalization of China-U.S. relations and his consistent devotion to promoting mutual understanding and friendship between the two peoples.

Full text

BEIJING, Dec. 31 (Xinhua) -- On New Year's eve, Chinese President Xi Jinping delivered his 2025 New Year message through China Media Group and the Internet. The following is the full text of the message:

Greetings to everybody! Time flies fast, and the new year will be with us shortly. I extend my best wishes to you all from Beijing.

In 2024, we have together journeyed through the four seasons. Together, we have experienced winds and rains and seen rainbows. Those touching and unforgettable moments have been like still frames showing how extraordinary a year we have had.

We have proactively responded to the impacts of the changing environment at home and abroad. We have adopted a full range of policies to make solid gains in pursuing high-quality development. China's economy has rebounded and is on an upward trajectory, with its GDP for the year expected to pass the 130 trillion yuan mark. Grain output has surpassed 700 million tons, and China's bowls are now filled with more Chinese grain. Coordinated development across regions has gained stronger momentum, and mutually reinforcing advances have been made in both new urbanization and rural revitalization. Green and low-carbon development has been further enhanced. Indeed, a more beautiful China is unfolding before us.

We have fostered new quality productive forces in light of actual conditions. New business sectors, forms and models have kept emerging. For the first time, China has produced more than 10 million new energy vehicles in a year. Breakthroughs have been made in integrated circuit, artificial intelligence, quantum communications and many other fields. Also for the first time, the Chang'e-6 lunar probe collected samples from the far side of the moon. The Mengxiang drilling vessel explored the mystery of the deep ocean. The Shenzhen-Zhongshan Link now connects the two cities across the sea. The Antarctic Qinling Station is now in operation on the frozen continent. All this epitomizes the lofty spirit and dreams of the Chinese people to explore stars and oceans.

This year, I have visited many places across the country and seen how our people enjoy their enriching lives. I saw the big, red Huaniu apples in Tianshui, Gansu and the fishing boats in Aojiao Village, Fujian loaded with their catches. I watched the millenium-old "Eastern Smile" in the Maiji Mountain Grottoes, and I learned more about good-neighborliness passed from generation to generation in Liuchixiang Alley. I enjoyed the hustle and bustle in Tianjin's Ancient Culture Street, and I saw how the people in Yinchuan's mixed-ethnic residential communities live together as one family. The concerns of the people about jobs and incomes, elderly and child care, education and medical services are always on my mind. This year, basic pension has been raised, and mortgage rates have dropped. Cross-province direct settlement of medical bills has been expanded, making it easier for people to seek medical treatment across the country. And consumer goods trade-in programs have improved people's lives... All these are real benefits to our people.

In the Paris Olympics, Chinese athletes raced to the top and achieved their best performance in Olympic Games held overseas, fully demonstrating the vigor and confidence of young Chinese. The PLA Navy and Air Force celebrated their 75th birthdays, and our servicemen and women are full of drive. When floods, typhoons and other natural disasters struck, members of the Communist Party of China and officials stepped forward to lead disaster relief efforts, and our people were of one mind and reached out to each other. People in all fields -- workers, builders and entrepreneurs, among others -- are working hard to fulfill their dreams. I presented awards to recipients of national medals and honorary titles. The honor belongs to them; it also belongs to every hard-working person who has lived up to their responsibilities.

In a world of both transformation and turbulence, China, as a responsible major country, is actively promoting global governance reform and deepening solidarity and cooperation among the Global South. We are making deeper and more substantive advances in high-quality Belt and Road cooperation. The Beijing Summit of the Forum on China-Africa Cooperation was a full success. We put forward China's vision at the Shanghai Cooperation Organization, BRICS, APEC, G20 and other bilateral and multilateral forums. We have contributed greatly to the maintenance of world peace and stability.

We celebrated the 75th anniversary of the founding of New China. With deep affection, we looked back at the sea change that has taken place across China since the birth of the People's Republic. Nurtured by our 5,000-plus years of continuous civilization, our country, China, is engraved not only on the bottom of the ancient bronze ritual wine vessel of He Zun, but also in the heart of every Chinese. At its Third Plenary Session, the 20th Central Committee of the Communist Party of China sounded a clarion call for further deepening all-round reform. We will march forward in great strides to advance reform and opening up as the trend of our times. We will surely embrace even broader prospects in pursuing Chinese modernization in the course of reform and opening up.

In 2025, we will fully complete the 14th Five-Year Plan. We will implement more proactive and effective policies, pursue high-quality development as a top priority, promote greater self-reliance and strength in science and technology, and maintain sound momentum in economic and social development. The Chinese economy now faces some new conditions, including challenges of uncertainties in the external environment and pressure of transformation from old growth drivers into new ones. But we can prevail with our hard work. As always, we grow in the wind and rain, and we get stronger through hard times. We must be confident.

Of all the jobs in front of us, the most important is to ensure a happy life for our people. Every family hopes that their children can have a good education, their seniors can enjoy good elderly services, and their youngsters can have more and better opportunities. These simple wishes are our people's aspirations for a better life. We should work together to steadily improve social undertakings and governance, build a harmonious and inclusive atmosphere, and settle real issues, big or small, for our people. We must bring more smiles to our people and greater warmth to their hearts.

On the eve of the 25th anniversary of Macao's return to the motherland, I visited the city again, and I was gratified to see the new progress and changes there. We will unswervingly implement the policy of One Country, Two Systems to maintain long-term prosperity and stability in Hong Kong and Macao. We Chinese on both sides of the Taiwan Strait belong to one and the same family. No one can ever sever the bond of kinship between us, and no one can ever stop China's reunification, a trend of the times.

As changes unseen in a century accelerate across the world, it is important to rise above estrangement and conflict with a broad vision, and care for the future of humanity with great passion. China will work with all countries to promote friendship and cooperation, enhance mutual learning among different cultures, and build a community with a shared future for mankind. We must jointly create a better future for the world.

Dreams and wishes may be far, but they can be fulfilled with dedicated pursuit. On the new journey of Chinese modernization, everyone is a key actor, every effort counts, and every ray of light shines.

Splendor adorns our motherland, and starlight graces every home. Let us greet the new year with hope. May our great country enjoy harmony and prosperity! May all your dreams come true! May you all have a new year of happiness and peace! Enditem

Xi Jinping, general secretary of the Communist Party of China (CPC) Central Committee, Chinese president and chairman of the Central Military Commission, delivered an important speech at the conference.

Below are six personal takeaways from the readout and a full text translation.

1. Consumption, consumption and consumption

一是大力提振消费、提高投资效益，全方位扩大国内需求。

First, efforts should be made to vigorously boost consumption, improve investment efficiency, and expand domestic demand on all fronts.

...

要紧抓关键环节完成好明年经济工作重点任务，针对需求不足的突出症结，着力提振内需特别是居民消费需求。

More endeavors should be focused on the accomplishment of major tasks for next year in key links, the meeting noted. In response to the prominent problem of insufficient demand, the country should boost domestic demand, especially consumer demand.

Consumption is one of the key focal points of this year's CEWC. Among the nine priorities outlined, consumption came as the first, followed by technological innovation. Last year, it was technological innovation at the top, with consumption second.

The readout also emphasized “着力提振内需，特别是居民消费需求 boost domestic demand, especially consumer demand,” with the wording shifting from last year's "着力扩大国内需求 expand domestic demand" to "全方位扩大国内需求 expand domestic demand in an all-round way."

To me, this echoes a recent piece by Weijian Shan, executive chairman of PAG, published in the South China Morning Post, highlighting the growing importance of China's domestic consumption.

China, with a population of over 1.4 billion, has a steadily expanding middle-income group. The country ranks among the world's leaders in total retail sales of consumer goods and still has significant potential for steady growth in the future.

The meeting of the Political Bureau of the CPC Central Committee on Monday called for expanding domestic demand on all fronts. On one hand, there is a clear focus on stimulating consumption, with expectations that fiscal spending will shift from prioritizing investment to boosting purchasing power and willingness, said Wu Chaoming, vice head of Chasing International Economic Institute under the state-owned Chasing Financial Group, according to 21st Century Business Herald.

"On the other, there is an emphasis on improving investment efficiency. While China’s investment levels are already substantial, returns have been declining. Revitalizing existing assets and enhancing investment efficiency will, in turn, help drive demand," Wu said.

2. Rat-race irrational competition

以科技创新引领新质生产力发展，建设现代化产业体系 ...... 综合整治“内卷式”竞争，规范地方政府和企业行为。积极运用数字技术、绿色技术改造提升传统产业。

Efforts should be made to drive the development of new quality productive forces through scientific and technological innovation and build a modernized industrial system … The meeting also underscored addressing rat-race irrational competition and regulating behaviors of local governments and enterprises. Digital and green technologies should be actively used to transform and upgrade traditional industries.

In the section on technological innovation and the development of new quality productive forces, mentioning “综合整治‘内卷式’ 竞争 comprehensively rectify ‘involution’ competition" highlights two key points: the proactive efforts of local governments in fostering new quality productive forces and the central government's intent to minimize resource waste and unnecessary mutual competition in this process. This could indicate that by 2025, we might witness a more balanced approach to local investment layouts, which would be beneficial for the long-term health of the economy.

3. Private sector

发挥经济体制改革牵引作用，推动标志性改革举措落地见效。高质量完成国有企业改革深化提升行动，出台民营经济促进法。

Efforts should be made to give full play to the driving role of economic system reform and ensure that landmark reform measures are effectively implemented. The initiative to deepen and upgrade the reform of state-owned enterprises should be completed in a high-quality manner, a private sector promotion law should be rolled out.

According to Xinhua, 民营经济促进法 private sector promotion law aims to promote high-quality development and establish regulations on fair competition review and revise regulations on the payment of funds to support small and medium-sized enterprises.

On the same day the CEWC concluded, Pony Ma, Chairman and CEO of Tencent, published an article in People's Daily titled "为经济回升向好贡献互联网力量 Contributing the Power of the Internet to Economic Recovery and Growth."

“Recently, the central government has introduced a package of incremental policies, addressing the pain points and blockages in current economic operations and 全面回应市场呼声 comprehensively responding to market demands,” he said.

The use of the word “全面 comprehensively” reflects a highly affirmative stance toward central policies. He also highlighted the formulation of strong institutional frameworks, such as the private sector promotion law, addressing the areas that private enterprises have historically been most concerned and worried about. Ma believes that these measures have created positive expectations, enabling businesses to move forward with fewer burdens.

4. A more proactive fiscal policy and a moderately loose monetary policy

要实施更加积极的财政政策。提高财政赤字率，确保财政政策持续用力、更加给力。...... 要实施适度宽松的货币政策。发挥好货币政策工具总量和结构双重功能，适时降准降息，保持流动性充裕，使社会融资规模、货币供应量增长同经济增长、价格总水平预期目标相匹配。

The country should adopt a more proactive fiscal policy. It should set a higher deficit-to-GDP ratio and ensure that its fiscal policy is continuously forceful and more impactful ... A moderately loose monetary policy should be implemented, the meeting noted, calling for efforts to leverage the function of monetary policy tools in both quantity and structural terms. It said the reserve requirement ratio and interest rates should be reduced at an appropriate timing, noting that ample liquidity should be maintained and that the growth of social financing and money supply should match the expected targets for economic growth and price levels.

According to the meeting of the Political Bureau of the Communist Party of China (CPC) Central Committee on Monday, China pledged to transition its monetary stance to "适度宽松 moderately loose" once again, and to adopt a more proactive fiscal policy next year. It is noteworthy that "更加 more" is added before "积极的 proactive" in describing the latest fiscal policy.

A commentary by Xinhua on Tuesday highlighted that, after over a decade, China's pledge to adopt a "moderately loose" monetary policy marks the first "稳健 prudent" to "适度宽松 moderately loose" transition in the country's monetary stance since 2011.

The last time this approach was adopted was in response to the global financial crisis between 2008 and 2010. It sends a positive signal that is expected to strongly boost confidence and support the recovery and improvement of China's economy.

Bloomberg has compiled a special review of the evolution of China's monetary policy language over the past 30 years.

5. Unilateral opening up

扩大高水平对外开放，稳外贸、稳外资。有序扩大自主开放和单边开放，稳步扩大制度型开放，推动自由贸易试验区提质增效和扩大改革任务授权，加快推进海南自由贸易港核心政策落地。

Efforts should be made to expand high-standard opening up while keeping foreign trade and foreign investment stable. Work should be done to expand voluntary and unilateral opening up in an orderly manner, steadily enhance institutional opening up, improve the quality and efficiency of pilot free trade zones and expand mandate for reform tasks, and accelerate the implementation of core policies of the Hainan Free Trade Port.

Expanding visa-free policy is a milestone in China's journey toward greater openness. If this year marks China's initial attempt at unilateral opening up, then based on the readout of the CEWC, unilateral opening up appears to be a planned action for next year. This suggests that China may introduce more visa-free policies for a wider range of countries. There are some discussions online about whether China might implement conditional or unconditional visa-free policies for countries like the United States, the United Kingdom, and Canada, but it remains uncertain at this point.

6. The 15th Five-Year Plan (2026-2030)

高质量完成“十四五”规划目标任务，为实现“十五五”良好开局打牢基础。…… 及早谋划“十五五”重大项目。...... 要准确把握世情国情党情社情，加强战略谋划，制定好中央“十五五”规划建议。

Fulfill the goals and tasks in the 14th Five-Year Plan with high quality and lay a solid foundation for a good start to the 15th Five-Year Plan (2026-2030) ... Major projects under the 15th Five-Year Plan should be planned early ... It is important to accurately understand developments globally, nationally, within the Party and in society, strengthen strategic planning, and well formulate the CPC Central Committee's proposals for the 15th Five-Year Plan.

Next year marks the final year of China's 14th Five-Year Plan. Although the 15th Five-Year Plan cycle is still a year away, the frequent mentions of it during this year's CEWC underscore China's proactive and well-organized approach to planning its future development. The emphasis on accurately assessing various situations reflects the central government's commitment to maintaining a clear understanding of the current landscape.

I've been asked by many recently whether China's decision-making process takes market and public opinion into account. In a recent article titled "如何看待经济数据和经济增长 How to view economic data and economic growth," published on Monday on 中国经济网 China Economic Network, Dong Yu, executive vice director of China Institute for Development Planning, Tsinghua University, actually addressed this question.

Dong was previously deputy director-general of the Second Economic Bureau of the Office of the Central Financial and Economic Affairs Commission and, before that, an official at China’s National Development and Reform Commission (NDRC).

“Many of the policy tools are used for the first time, and the interaction between macroeconomic regulation and public opinion is something we have barely seen before. These are all invaluable assets," Dong wrote.

Regarding why there is a gap between real market conditions and the government's assessment, Dong pointed out that while most market analyses are generally professional, analysts often lack direct experience in macroeconomic regulation, which naturally leads to a "disconnect" in understanding.

Going forward, he suggested improving communication and creating more channels for information exchange so that the market can better understand the true considerations behind policy decisions.

As for criticisms and doubts, Dong believed that as long as they are not ill-intentioned, they can be viewed as constructive feedback for policymakers, with certain viewpoints potentially offering useful insights for future decisions.

Later on Thursday, 玉渊谭天 Yuyuan Tantian, a social media account affiliated with China Media Group, posted an article on Weibo, offering an analysis of the readout of the CEWC. At the end of the article, it says:

年末已至，舆论场都在讨论明年经济社会的发展以及政策的力度、方向，这期间仍然充满各种各样的声音，有乐观，亦有忧虑。实际上，只要探讨问题，我们就是不悲观的。

As the year draws to a close, public discourse is abuzz with discussions about the direction, strength, and policies shaping economic and social development in the coming year. Amid this, a variety of voices emerge, ranging from optimism to concern. In truth, the very act of exploring these issues signifies that we are not pessimistic.

The post by Yuyuan Tantian reminded me of a similar sentiment expressed by Robert Wu on his WeChat blog “意外的CEO Unexpected CEO." While explaining one of the reasons to remain optimistic about China’s economy, Robert wrote: “It is precisely because we are sufficiently anxious, because enough people are feeling pessimistic and actively thinking about solutions rather than choosing to become numb. So, as long as people remain sufficiently pessimistic, I will stay optimistic -- that's the rationale.”

Full text of the readout of the Central Economic Work Conference

[Note: This newsletter was updated on Dec. 16 to include the full text readout of the CEWC published by Xinhua]

Xi delivers important speech at Central Economic Work Conference

BEIJING, Dec. 16 (Xinhua) -- The Central Economic Work Conference was held in Beijing from Dec. 11 to 12. Xi Jinping, general secretary of the Communist Party of China (CPC) Central Committee, Chinese president and chairman of the Central Military Commission (CMC), attended the conference and delivered an important speech. Li Qiang, Zhao Leji, Wang Huning, Cai Qi, Ding Xuexiang and Li Xi, all members of the Standing Committee of the Political Bureau of the CPC Central Committee, also attended the conference.

In his speech, Xi summarized the economic work in 2024, analyzed the current economic situation and arranged the economic work for 2025. Li Qiang delivered a summary speech, in which he laid out requirements for implementing the guiding principles of Xi's speech and doing a good job in economic work next year.

This year marks a crucial year for achieving the objectives and tasks laid down in the 14th Five-Year Plan (2021-2025), said the conference. In the face of a complicated and challenging environment of increasing external pressure and growing internal difficulties, the CPC Central Committee with Comrade Xi Jinping at its core has united and led the entire Party and the Chinese people of all ethnic groups to respond calmly and implement comprehensive measures. As a result, the economy has maintained overall stability and made steady progress, the high-quality development has been solidly promoted, and the main goals and tasks of economic and social development are expected to be successfully completed. The country has steadily developed new quality productive forces, continued to deepen reform and opening up, orderly and effectively defused risks in key areas, safeguarded people's livelihood in a solid and vigorous manner, and made new solid strides forward in advancing Chinese modernization. The development journey over the past year has been extraordinary, with encouraging achievements. Notably, the decisive deployment of a package of incremental policies at the meeting held by the Political Bureau of the CPC Central Committee on Sept. 26 has effectively boosted social confidence and led to a remarkable economic recovery.

It was pointed out at the meeting that the adverse impacts brought about by changes in the external environment have deepened, and the country's economy still faces many difficulties and challenges, primarily including the insufficient domestic demand, operational difficulties in some enterprises, pressures on people's employment and income growth, and many hidden risks. At the same time, it must be recognized that Chinese economy is underpinned by a stable foundation, multiple advantages, strong resilience, and great potential, and the supporting conditions and fundamental trends for long-term sound economic development have not changed. We must face up to the difficulties, strengthen our confidence, and strive to transform all positive factors into actual achievements in development.

The meeting pointed out that, through practice, we have continuously deepened our understanding of the laws governing economic work. The centralized and unified leadership of the CPC Central Committee is the fundamental guarantee for carrying out economic work well. At critical moments and important junctures, the CPC Central Committee promptly assesses the situation and makes decisions and arrangements to ensure that China's economy braves the wind and the waves and sails steadily into the future. It is necessary to coordinate the relationship between an efficient market and an effective government to form an economic order that is both dynamic and well-regulated. The relationship between aggregate supply and demand must be properly managed to ensure the smooth circulation of the national economy. It is necessary to coordinate the relationship between fostering new drivers and upgrading old ones, and promote the development of new quality productive forces in light of local conditions. It is imperative to coordinate the relationship between optimizing incremental resources and making good use of existing resources to comprehensively improve the efficiency of resource allocation. The relationship between enhancing quality and expanding total output must be coordinated to lay a solid material foundation for Chinese modernization.

It was emphasized at the meeting that to do a good job in the economic work next year, it is necessary to follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implement the guiding principles of the 20th CPC National Congress and the second and third plenary sessions of the 20th CPC Central Committee, adhere to the general principle of pursuing progress while maintaining stability, as well as fully and accurately implement the new development philosophy on all fronts. It is also essential to accelerate the forging of a new development paradigm, solidly promote high-quality development, further deepen reform comprehensively, expand high-standard opening up, build a modern industrial system, better coordinate development and security, implement more proactive and impactful macro policies, expand domestic demand, promote the integrated development of scientific and technological innovation and industrial innovation, stabilize the real estate and stock markets, prevent and resolve risks in key areas and external shocks, stabilize expectations and stimulate vitality, promote sustained economic recovery, continuously improve people's living standards, maintain social harmony and stability, and fulfill the goals and tasks in the 14th Five-Year Plan with high quality and lay a solid foundation for a good start to the 15th Five-Year Plan (2026-2030).

For next year, it is a must to maintain steady economic growth, keep employment and prices generally stable, ensure a basic equilibrium in the balance of payments, and increase residents' income in step with economic growth, the meeting noted.

It was required at the meeting that next year, the country should continue to seek progress while maintaining stability, promote stability through progress, uphold fundamental principles and break new ground, establish the new before abolishing the old, pay attention to integrated reforms, and strengthen coordination. The policy toolkit should be enriched and improved, and macro regulation should be more forward-looking, targeted and effective.

The country should adopt a more proactive fiscal policy. It should set a higher deficit-to-GDP ratio and ensure that its fiscal policy is continuously forceful and more impactful. Efforts will be made to increase the intensity of fiscal spending and strengthen support for key areas. The country will increase the issuance of ultra-long special treasury bonds and continue to support projects for implementing major national strategies and building security capacity in key areas, as well as implementation of large-scale equipment upgrades and consumer goods trade-in programs. It will also increase the issuance of local government special-purpose bonds, and expand the areas of their investment and use as project capital. It is also required to optimize the structure of fiscal expenditure, use government funds to greater effect, pay more attention to improving people's lives, promoting consumption, and sustaining growth momentum, and see that basic living needs are met, salaries are paid, and governments function smoothly at the primary level. Party and government departments should keep their belts tightened.

A moderately loose monetary policy should be implemented, the meeting noted, calling for efforts to leverage the function of monetary policy tools in both quantity and structural terms. It said the reserve requirement ratio and interest rates should be reduced at an appropriate timing, noting that ample liquidity should be maintained and that the growth of social financing and money supply should match the expected targets for economic growth and price levels. The RMB exchange rate should be kept basically stable at a reasonable and balanced level. Explorations will be made to expand the central bank's function in macroprudential regulation and financial stability, innovate financial instruments, and keep the financial market stable.

The meeting called for better policy coordination. It demanded strengthening coordination between fiscal, monetary, employment, industrial, regional, trade, environmental and regulatory policies and the country's reform and opening up measures, improving inter-departmental mechanisms for effective communication and consultation and feedback, and increasing policy synergy. It is imperative to include economic and non-economic policies in the evaluation of the consistency of macroeconomic policy orientation, coordinate the whole process of policy formulation and implementation, and improve the overall effectiveness of policies.

The meeting outlined the following key tasks for 2025.

First, efforts should be made to vigorously boost consumption, improve investment efficiency, and expand domestic demand on all fronts. A special campaign dedicated to stimulating consumption should be implemented, and efforts should be made to increase the incomes, alleviate the burdens of low- and middle-income groups, and increase the ability, willingness and level of consumption. Work should be done to appropriately raise the basic pensions for retirees and increase basic old-age benefits and government subsidies for medical insurance for rural and non-working urban residents. The large-scale equipment upgrades and consumer goods trade-in programs should be promoted with greater intensity and scope. Work is needed to innovate diversified consumption scenarios, expand service consumption, and promote the development of cultural tourism. Active efforts should be made to develop debut economy, ice and snow economy and silver economy. The meeting called for better top-down organization and coordination to provide stronger support for implementing major national strategies and building security capacity in key areas. Investment from the central government budget should be appropriately increased. Work should also be done to strengthen fiscal and financial coordination to enable government investment to effectively drive nongovernmental investment. Major projects under the 15th Five-Year Plan should be planned early, urban renewal projects should be vigorously carried out, and special actions should be conducted to cut logistics costs throughout society.

Second, efforts should be made to drive the development of new quality productive forces through scientific and technological innovation and build a modernized industrial system. It is necessary to strengthen basic research and strive for breakthroughs in key and core technologies, adopt forward-thinking arrangements for major technological projects, conduct large-scale demonstration for the application of new technologies, products, and scenarios, launch an AI Plus initiative, nurture industries of the future, and boost China's strategic scientific and technological strength. The country should improve the multi-tiered financial service system, nurture patient capital, attract greater nongovernmental capital participation in venture capital, and cultivate innovative enterprises through tiered support. The meeting also underscored addressing rat-race irrational competition and regulating behaviors of local governments and enterprises. Digital and green technologies should be actively used to transform and upgrade traditional industries, it noted.

Third, efforts should be made to give full play to the driving role of economic system reform and ensure that landmark reform measures are effectively implemented. The initiative to deepen and upgrade the reform of state-owned enterprises should be completed in a high-quality manner, a private sector promotion law should be rolled out, and a specific campaign to standardize law enforcement involving enterprises should be conducted. Work will be done to formulate a guideline for building a unified national market, and enhance regulation and promote the healthy development of the platform economy. The meeting also called for reforming the fiscal and tax systems in a coordinated manner and placing more fiscal resources at the disposal of local governments. The comprehensive reform of investment and financing in the capital market should be deepened, the bottlenecks for the entry of medium- and long-term capital into the market should be resolved, and the capital market system's inclusiveness and adaptability should be improved.

Fourth, efforts should be made to expand high-standard opening up while keeping foreign trade and foreign investment stable. Work should be done to expand voluntary and unilateral opening up in an orderly manner, steadily enhance institutional opening up, improve the quality and efficiency of pilot free trade zones and expand mandate for reform tasks, and accelerate the implementation of core policies of the Hainan Free Trade Port. Work should be done to actively develop service trade, green trade and digital trade, further reform the institutions and mechanisms for promoting foreign investment, steadily open up the service sector, expand the pilot programs in opening up such fields as telecom, healthcare and education, and continue to make China a favored destination for foreign investment. The meeting also urged solid progress in high-quality Belt and Road cooperation and improvement in the overseas comprehensive service system.

Fifth, efforts should be made to effectively prevent and defuse risks in key areas to ensure that no systemic risks occur. It is essential to continuously ratchet up work to reverse the downturn of and stabilize the real estate market, further advance the renovation of shanty towns in cities and dilapidated houses, and fully unleash the potential in people's demand for buying their first homes or improving their housing conditions. Work will be done to reasonably control the supply of newly added real estate land, make good use of existing land resources as well as commercial and office properties, and advance the disposal of existing commodity housing. The meeting also urged fostering a new development model for the real estate sector and establishing relevant foundational systems in an orderly manner. Meanwhile, it called for work to address risks in local small and medium-sized financial institutions in a prudent manner, and joint and coordinated efforts by central and local governments to crack down on illegal financial activities.

Sixth, efforts should be made to pursue coordinated progress in new urbanization and all-around rural revitalization and promote integrated urban-rural development. The meeting urged ensuring that the total area of China's farmland remains above the specified red line, while demanding stringent management on offsetting cultivated land that has been put to other uses. Work should be done to ensure stable production and supply of grain and other key farm produce, increase agriculture's overall efficiency and competitiveness, keep grain farmers and major grain-producing areas motivated and optimize the grain pricing mechanism. It also called for developing industries, empowering counties and enriching people in an integrated manner according to local conditions, and doing everything possible to expand channels for farmers to increase incomes. Modern metropolitan areas should be developed, while the governance of super-large and mega cities should be more modernized and county economies should be vigorously boosted.

Seventh, efforts should be made to strengthen the implementation of regional strategies and boost regional development vitality. The meeting called for giving full play to the synergy of the coordinated regional development strategy, major regional strategies, and the functional zoning strategy, while actively fostering new growth poles. It urged enhancing the innovation capabilities and leading role of areas with economic development advantages, supporting major economically developed provinces to play major roles, and encouraging other regions to leverage their local conditions and advantages. Industrial collaboration between the eastern, central, western and northeastern regions should be deepened, while maritime economy and bay area economy should be actively boosted.

Eighth, efforts should be made to cut carbon emissions, reduce pollution, pursue green development and boost economic growth in a concerted manner, and ramp up the green transition in economic and social development. The meeting urged further deepening institutional reform for ecological conservation, creating an ecosystem for healthy development of green and low-carbon industries and cultivating new growth drivers including eco-friendly buildings. Work should be done to push for major progress in the landmark projects of the Three-North Shelterbelt Forest Program and promote faster construction of new energy bases in sandy areas, rocky areas and deserts. It also called for the construction of a group of zero-carbon industrial parks, the development of a national carbon market, the establishment of a product carbon footprint management system and a carbon labeling and certification system. Constant efforts should be made to keep the skies blue, waters clear and lands clean, an action plan should be formulated for the comprehensive treatment of solid waste, major biodiversity conservation programs should be carried out, and the construction of a natural disaster prevention and control system should be strengthened.

Ninth, efforts should be made to ensure and improve the people's wellbeing, and give the people a growing sense of fulfillment, happiness, and security. It demanded implementing employment support plans for key sectors and industries, urban and rural communities, and micro, small and medium-sized enterprises, as well as facilitating employment among key groups. Work should be done to better protect the rights and interests of groups in flexible and new forms of employment, implement policies to strengthen assistance for industrial development and employment, and ensure that no large-scale lapsing or relapsing into poverty occurs and the basic needs of people in difficulty are met. Work should be done to promote the high-quality and balanced development of compulsory education and make solid progress in expanding quality undergraduate education. The meeting also called for implementing the project of strengthening the foundation for medical and health care, formulating pro-childbirth policies, developing community-supported at-home elderly care, and expanding universally beneficial elderly care services. The "Fengqiao model" for promoting community-level governance in the new era should be applied and further developed, and the systemic public security governance should be strengthened.

The meeting urged using the scientific assessment of the CPC Central Committee on the situation to achieve unity in thinking, will and action, and grasping the overall trend and firming up confidence while facing up to difficulties and staying clear-headed. It called for comprehensively implementing the overall requirements and policy orientation for next year's economic work, taking a target-oriented approach, and achieving an optimized mix of stable growth, stable employment and reasonable price rebounds. It urged ensuring sound policy orientation and proper timing and intensity, and doing work in a prompt and effective manner with sufficient intensity. Systemic thinking should be strengthened to coordinate various policies and reform and opening up measures to see that together they deliver greater outcomes. More endeavors should be focused on the accomplishment of major tasks for next year in key links, the meeting noted. In response to the prominent problem of insufficient demand, the country should boost domestic demand, especially consumer demand; in response to the deep-seated obstacles and external challenges that hinder development, it should unswervingly deepen reform and expand opening up; in view of the bottlenecks in industrial transformation and upgrading, it should promote the steady replacement of old growth drivers with new ones; to address the concerns and demands of enterprises in their operations, the country should strengthen policy support and optimize regulation and services; in order to address risks and hidden dangers in key areas, it should make persistent efforts in risk disposal. It is crucial to enhance the effectiveness of policy implementation, fully mobilize primary-level initiative and creativity, continuously improve the business environment, and better pool efforts to promote high-quality development.

It was stressed at the meeting that it is necessary to strengthen the Party's leadership over economic work, make it a priority to get things done, strengthen confidence, face difficulties head-on, and work hard to ensure that all decisions and arrangements of the CPC Central Committee are fully implemented. It is a must to intensify positive incentives and stimulate the enterprising spirit. Effective measures should be taken to ease the burden for governments at the primary level and enable willing and capable officials to act and deliver. Efforts must be made to resolutely combat corruption and maintain a fair and just market environment and a clean business environment. It is necessary to take a realistic and pragmatic approach, and resolutely oppose pointless formalities and bureaucratism that feature eagerness to impress superiors but neglect of responsibilities for the people. Efforts should be made to ensure both development and security, improve workplace safety, and effectively prevent and respond to social security incidents in a timely manner. It is also imperative to enhance coordination and interaction, oppose parochialism, and form synergy to ensure implementation. Efforts should also be made to strengthen expectation management and coordinate policy implementation with expectation guiding, thereby enhancing policy guidance and influence. Meanwhile, it is important to accurately understand developments globally, nationally, within the Party and in society, strengthen strategic planning, and well formulate the CPC Central Committee's proposals for the 15th Five-Year Plan.

The meeting demanded efforts to ensure people's livelihood, security and stability at the turn of the year, and thoroughly identify and resolve all kinds of conflicts and disputes as well as risks and hidden dangers, in a bid to guarantee overall social stability.

The meeting called on the whole Party, the whole country and all sectors of society to closely unite around the CPC Central Committee with Comrade Xi Jinping at its core, earnestly implement various arrangements of the conference, comprehensively fulfill the goals and tasks of economic and social development, and advance the building of a great country and the great cause of national rejuvenation on all fronts through practical achievements in high-quality development.

Members of the Political Bureau of the CPC Central Committee, secretaries of the Secretariat of the CPC Central Committee, leaders of the Standing Committee of the National People's Congress, state councilors, president of the Supreme People's Court, procurator-general of the Supreme People's Procuratorate, leaders of the National Committee of the Chinese People's Political Consultative Conference, members of the Central Military Commission, and others attended the meeting.

Also present at the meeting were leading officials of provinces, autonomous regions, municipalities directly under the central government, municipalities with independent budgetary status, and the Xinjiang Production and Construction Corps, as well as leading officials from relevant central Party and government departments, people's organizations, some financial institutions and enterprises under central management, and relevant departments of the CMC. Enditem

China's top legislature starts standing committee session -- Xinhua

Lawmakers also reviewed a State Council bill on raising ceilings on local government debt to replace existing hidden debts, several reports on handling proposals submitted by lawmakers, a deputy qualification report, and personnel-related bills, among others.

Chinese Premier Li Qiang recently reaffirmed China’s confidence in achieving its annual economic growth targets. His affirmation came during a speech at the 7th China International Import Expo (CIIE) on Nov. 5, a major project consistently promoted by the Chinese government in recent years.

This is the context in which Premier Li mentioned confidence in achieving this year's economic growth targets during his speech at CIIE:

我们面对经济下行压力，我们有条件加大逆周期调节力度，财政政策、货币政策等都有比较大的空间，政策工具也更加丰富，宏观调控的精准度、有效性不断的增强。同时我们注重调动各方面的积极性，不断的激发经济的内生动力。因此无论是对今年目标的实现，还是对今后一个时期中国经济的发展，我们都是充满信心的。

In the face of downward economic pressure, we are poised to strengthen counter-cyclical adjustments. There is considerable room to be tapped into in fiscal and monetary policies, and the range of policy tools has become more diverse. The precision and effectiveness of macroeconomic regulation continue to improve. Meanwhile, we laid great emphasis on motivating various sectors and continuously strengthening the internal driving force of the economy. Therefore, we remain fully confident not only in achieving this year's targets but also in the long-term development of China's economy.

China's economy grew by 4.8% in the first three quarters of the year, which aligns with the target GDP growth rate of “5%左右” around 5% set at the beginning of the year. The government has introduced a package of economic stimulus policies starting at the end of September. A notable meeting of the Political Bureau of the Communist Party of China (CPC) Central Committee on Sept. 26, referred to simply as “9.26,” has become a significant milestone.

The Standing Committee of the 14th National People's Congress (NPC), China's top legislature, started its 12th session Monday in Beijing and is expected to conclude on Friday afternoon. As you may recall, during the Ministry of Finance press conference on Oct. 12, when some asked about the specifics of the debt swap plan, Minister Lan Fo'an responded that the debt restructuring needed to follow legal procedures, referring specifically to the NPC Standing Committee session that started this week.

Recently, I've had discussions with some domestic investors and economic observers, and I could sense a strong interest not only in the scale of debt restructuring but also in how the funds released to local governments will be used for public welfare investments. Additionally, there is significant market attention on how the central government ensures that local governments effectively implement the policies.

Therefore, I believe that it is essential for the Ministry of Finance to make clear statements on certain occasions. For instance, according to Cailian Press:

财政部在不同场合强调，督促地方政府严肃财经纪律、强化预算约束、划清政企权责，严禁地方政府通过国有企事业单位违规举债建设政府投资项目，严禁举债建设楼堂馆所、形象工程。持续保持高压监管态势，发挥部门协同监管合力，严格落实地方政府举债终身问责制和债务问题倒查机制，对新增隐性债务和不实化债等行为，发现一起、查处一起、问责一起。

The Ministry of Finance has repeatedly emphasized on various occasions the need for local governments to adhere strictly to financial discipline and budget constraints, clearly delineate the responsibilities between government and enterprises, and strictly prohibit local governments from financing debt through state-owned enterprises to fund government investment projects or constructing grand buildings and vanity projects. The ministry advocates maintaining a high-pressure regulatory stance, leveraging collaborative supervision among departments, and strictly implementing a lifelong accountability system for local government borrowing and a backward tracing mechanism for debt issues. This includes discovering, investigating, and holding accountable each instance of new hidden debt and false debt restructuring.

Regarding the current challenges and solutions for China's economy, I think Zhang Bin, the Deputy Director of the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, spoke very clearly about it in a recent interview with China Daily.

他认为，从目前情形看，我国需要把逆周期政策的力度进一步加大。“克服总需求（不足）的情况其实像一场赛跑。要走出需求不足，政策要走在市场的前面，才能够打破预期，然后才能够扭转预期，进入到一个良性的循环里面。”

......

张斌称，逆周期政策最终的落脚点是提高全社会的收入水平。据他测算，三季度消费倾向（人均消费支出/人均可支配收入）已经上升至约67%，几乎恢复到疫情前的水平。这意味着，在收入不变的情况下进一步扩大消费，空间已经非常有限，进一步扩大消费要靠提高收入，而提高收入要靠扩大支出。

“带动消费不是说光是激发消费意愿、创造消费场景就行了。更重要的是提高我们的收入，而提高收入，跟中央政治局会议、四部委的（发布）会、逆周期政策是紧密联系在一块的，因为逆周期政策最终落在地上是要提高收入。”

He believes that, given the current situation, our country needs to further intensify counter-cyclical policies. "Overcoming the situation of insufficient total demand is like a race. To get past this insufficiency, policies need to exceed market expectations, entering into a virtuous cycle."

Zhang Bin stated that the ultimate goal of counter-cyclical policies is to raise the overall income level of society. According to his calculations, the propensity to consume in the third quarter (average consumer spending/average disposable income) has risen to about 67%, nearly returning to pre-pandemic levels. This means that with incomes remaining constant, the room to further expand consumption is very limited; increasing consumption further depends on raising incomes, and that requires increasing expenditures.

"Driving consumption is not just about stimulating the desire to consume or creating scenarios for consumption. More importantly, it involves increasing our income, which is closely linked to meetings of the Central Politburo, joint announcements by various ministries, and counter-cyclical policies because the practical implementation of these policies ultimately aims to increase income."

Moreover, I invited You Zhixin, a reporter from Xinhua's Shanghai bureau who covered this and the previous six years of CIIE, to share her insights on the event:

Since 2018, the U.S. has imposed several rounds of import tariff increases on China, a move that has been widely noted. However, perhaps not as many have noticed that in the same year, the China International Import Expo (CIIE) was launched. Every year since then, from November 5th to 10th, the CIIE, the world's first national-level exposition dedicated to imports, is held in Shanghai.

As a reporter who has covered the CIIE for seven consecutive years, I have interviewed dozens of newcomers and frequent attendees, participated in several forums, and witnessed how the CIIE strives to expand its global influence, aiming to become a catalyst for win-win cooperation worldwide and to offer international public goods and services that benefit the world, against the backdrop of varying global political and economic climates.

CIIE is an invaluable platform for companies seeking new partnerships.

Per Linden, Founder of the Nordic Hub Trade Association, has participated since the first year of the CIIE with a small booth. At the event, he met more suppliers and business partners, which drove his decision to set up the Nordic Hub, a permanent showroom of products from SMEs from Nordic countries in Shanghai. I think his story reflects the spirit of the CIIE, what is encouraging entrepreneurs to go there, find new ideas, and new partners for their next growth phase in China.

Against the backdrop of the auto trade conflict between China and Europe and the U.S., however, many major global auto companies are showcasing their latest innovative and environmentally friendly products this year, reaffirming their commitment to the world's largest vehicle market. At the same time, building on the success of last year, AmCham Shanghai and the United States Department of Agriculture partner again to launch the American Food & Agriculture Pavilion, promoting U.S. food and agricultural products at the venue. Obviously, their significant presence in China is imperative, since the country is an indispensable destination for trade and investment.

Following the seven-day National Day holiday, the National Development and Reform Commission (NDRC), China’s top economic planner, convened a press conference to introduce the latest economic stimulus policies.

Before the National Day holiday, China’s financial authorities announced a broader-than-expected policy package last month to stimulate economic recovery. These policy measures include reducing the reserve requirement ratio for banks and mortgage rates for existing homes, as well as introducing new monetary programs to boost the capital market, among other initiatives.

This broader-than-expected policy package has generated a palpable sense of FOMO (Fear of Missing Out) among many, tempering the prevailing "policy fatigue" among some observers of China's economy. It also draws people's additional attention to Tuesday's press conference.

However, cautionary voices remind people that the stock market always carries risks, particularly for the new wave of investors born post-1995 or 2000, who are navigating these waters for the first time.

Late yesterday (Oct. 7), China’s leading financial media outlets [Caixin] [Yicai] published a commentary by someone with deep ties to the People’s Bank of China in what Zichen Wang believe is a warning to overzealous individual investors.

Former PBOC Research Chief Attempts to Calm Stock Market Frenzy -- Pekingnology

Xu Zhong is Deputy Secretary-General of China’s state-backed National Association of Financial Market Institutional Investors, a self-regulatory organization in the inter-bank market. Before this, he served at the People’s Bank of China (PBOC) for over 20 years, holding various positions, including Director-General of the Research Bureau and Deputy Director-General of the Financial Market Department.

The “swap facility” introduced here does not involve the injection of base money or an expansion of the central bank’s balance sheet, meaning the central bank is not directly intervening in the stock market.

......

Both structural monetary policy tools are market-based and part of long-term market reform efforts. These tools do not increase the central bank’s base money supply or expand the monetary supply. They are targeted policy tools with specific use conditions, and the red line of preventing bank credit funds from illegally entering the stock market remains a key regulatory principle. Financial regulatory departments should scientifically monitor and evaluate capital market operations and carefully select the appropriate time windows.

And it turns out that the government was very carefully preparing today's press conference. "玉渊谭天 Yuyuan Tantian," a social media channel affiliated with China Media Group, posted an article just eight minutes before the opening of the press conference. The article revealed that 谭主 Tanzhu, the channel's operator, visited the NDRC to witness firsthand the detailed preparations for the briefing on Oct. 7, one day before the press conference.

发布会前一天下午，谭主专门去了一趟国家发展改革委。为了这场发布会，他们已经准备了很多天，我们到国家发展改革委时，他们还在为发布会做最后的梳理和完善。

"The afternoon before the press conference, Director Tan specifically made a trip to the National Development and Reform Commission. They had been preparing for this event for many days, and when we arrived at the Commission, they were still making final revisions and improvements for the press conference.

In the article, Tanzhu quotes Huang Hanquan, head of the Chinese Academy of Macroeconomic Research:

在过去的两个月中，我国经济总体保持稳中有进的发展态势，但也要看到，部分主要经济指标出现了边际走弱的现象，选择在这时开这样一场新闻发布会，介绍具体的政策举措，展现出了中央对解决当前经济回升中所遇到的问题、推动经济持续向好的决心。同时，这些举措也表明，我们现在还有充足的政策储备。

"Over the past two months, our country's economy has generally maintained a stable and progressive development trend. However, it should also be noted that some key economic indicators have shown marginal weakening. Choosing to hold a press conference at this time, introducing specific policy measures, demonstrates the central government's determination to address the issues encountered in the current economic recovery and to promote sustained economic improvement. Additionally, these measures indicate that we currently have an ample reserve of policies."

So, what emerged from the press conference?To me, the press conference was more of a recap of the measures introduced before the holiday rather than an announcement of detailed new initiatives. It served to reaffirm the central government's commitment to maintaining steady and healthy economic growth and achieving the full-year growth target, which is still very important.

China will study new policies to support economy: official -- Xinhua

China will study new policies in a timely manner to promote steady growth, structural improvement and sustained development of the economy, an official with the country's top economic planner said Tuesday.

The National Development and Reform Commission (NDRC) will closely follow changes of the economic situation, evaluate the effects of policy implementation, and conduct preliminary research on more supportive policies and maintain policy options, said Zheng Shanjie, head of the NDRC, at a press conference.

A meeting of the Political Bureau of the Communist Party of China Central Committee held on Sept. 26 called for stepping up efforts to roll out 增量政策 incremental policies as the country strives to accomplish its annual economic and social development targets. The press conference mentioned that the incremental policies also aim to boost domestic consumption and investment demand. There is no surprise that the "consumer goods trade-in program" and the "ultra-long special treasury bonds" will continue to be the two main "tools" to boost consumption and investment.

The country's consumer goods trade-in program has been fully activated, with passenger car sales rebounding sharply and electrical home appliance sales returning to growth. Related policies will be further advanced to fuel sustained increases in commodity consumption, Zheng said.

On the investment front, ultra-long special treasury bonds will continue to be issued next year with optimized investment areas to implement major national strategies and build up security capacity in key areas, he noted.

Investment projects worth 200 billion yuan (about 14.14 billion U.S. dollars) that are in next year's plans will be released in advance this year to support local governments in accelerating the preliminary work and construction, Zheng told reporters.

A certain proportion of these projects will involve urban renewal, mainly in the construction of pipelines for gas, water, sewage and heating, which is expected to generate investment demand of around 4 trillion yuan in the coming five years, said NDRC deputy head Liu Sushe at the press conference.

Looking forward, all eyes are now on potential fiscal policies which are expected to be aligned with current monetary strategies.

"If not now, when?" Goldman Sachs truly deserves the title of "the vanguard of foreign capital bull market" -- FUTUBULL

Goldman Sachs pointed out that each major policy reversal has led to repricing, with stock market gains rarely stopping at 30%. China's stock market reacts more positively to fiscal easing than monetary policy. Now that monetary policy has basically landed, if there are further fiscal stimulus measures in the future, the market may have a more positive response. Goldman Sachs has upgraded its rating on Hong Kong stocks to 'overweight', but is more bullish on A-shares compared to Hong Kong stocks, expecting A-shares to have a 14-15% upside in the next year.

Meanwhile, Bob Chen, a recent guest on my podcast, discussed the challenges of implementing these fiscal policies in his latest WeChat blog post.

但目前决策层表态后，压力来到了执行层。现在是执行层出棋的环节。这将是一个新的博弈阶段。现代信用货币体系下，相对低成本、路径清晰的降准、降息和利率均一化等货币政策已经推出。到第二阶段，牵涉利益更复杂、成本约束更刚性、道德风险顾虑更大的财政政策成为关键。而且无论是资源投入还是执行，都必须要地方配合，复杂度指数上升，利益平衡难度指数上升。

"However, following statements from the policy-making level, the pressure has now shifted to the implementation level. It is now the turn of the implementation level to make their move. This marks a new phase of strategic interaction. Under the modern credit money system, monetary policies such as relatively low-cost, clear-path reserve requirement reductions, interest rate cuts, and interest rate uniformity have already been implemented. In the second phase, fiscal policies that involve more complex interests, more rigid cost constraints, and greater concerns about moral hazard become critical. Moreover, whether in terms of resource allocation or execution, cooperation from local governments is essential, which significantly increases the complexity and difficulty of balancing interests.

So now, perhaps, it is truly a critical moment.

The resolution (Chinese, English PDF) was adopted at the third plenary session of the 20th CPC Central Committee on Thursday. The explanation (Chinese, English PDF) was made by Xi Jinping, general secretary of the CPC Central Committee, at the third plenary session.

Below is my ten quick takeaways of the resolution. I will first post the section of the original text I wish to comment on, and then provide my comments below it. Please note that the comments reflect my personal perspective and not that of any organizations.

1.Importance and necessity

进一步全面深化改革的重要性和必要性。改革开放是党和人民事业大踏步赶上时代的重要法宝。党的十一届三中全会是划时代的，开启了改革开放和社会主义现代化建设新时期。党的十八届三中全会也是划时代的，开启了新时代全面深化改革、系统整体设计推进改革新征程，开创了我国改革开放全新局面。

Reform and opening up have been crucial to the cause of the Party and the people, enabling us to catch up with the times in great strides. The third plenary session of the 11th CPC Central Committee was a landmark event that ushered in a new period: one of reform, opening up, and socialist modernization. The third plenary session of the 18th CPC Central Committee was also of epoch-making significance. It marked the start of a new journey of comprehensively deepening reform in the new era with systematic and holistic plans, thus paving the way for a brand new stage in China’s reform and opening up endeavors.

The designation of the third plenary session of the 11th CPC Central Committee in 1978 and the third plenary session of the 18th CPC Central Committee, presided over by Xi Jinping in 2013, as "划时代的 epoch-making" reaffirms their historical significance. Deng Xiaoping's pivotal role in the 1978 session and the ensuing reform and opening-up is well-documented. This evaluation of the two plenums is consistent with the Xinhua News Agency feature article "Profile: Xi Jinping the Reformer," which describes Xi as "another outstanding reformer in the country following Deng Xiaoping."

2.New quality productive forces

健全因地制宜发展新质生产力体制机制。推动技术革命性突破、生产要素创新性配置、产业深度转型升级，推动劳动者、劳动资料、劳动对象优化组合和更新跃升，催生新产业、新模式、新动能，发展以高技术、高效能、高质量为特征的生产力。加强关键共性技术、前沿引领技术、现代工程技术、颠覆性技术创新，加强新领域新赛道制度供给，建立未来产业投入增长机制，完善推动新一代信息技术、人工智能、航空航天、新能源、新材料、高端装备、生物医药、量子科技等战略性产业发展政策和治理体系，引导新兴产业健康有序发展。以国家标准提升引领传统产业优化升级，支持企业用数智技术、绿色技术改造提升传统产业。强化环保、安全等制度约束。

(8) Improving the institutions and mechanisms for fostering new quality productive forces in line with local conditions.

We will work to facilitate revolutionary breakthroughs in technology, innovative allocation of production factors, in-depth industrial transformation and upgrading, and the optimal combination of laborers, means of labor, and subjects of labor as well as their renewal and upgrading. All this will give rise to new industries, new business models, and new growth drivers and promote the development of productive forces that are characterized by high technology, high performance, and high quality. A stronger push will be made to pursue innovation in key generic technologies, cutting-edge technologies, modern engineering technologies, and disruptive technologies, and institutional supply will be boosted in new areas and arenas. We will establish a mechanism for ensuring funding increases for industries of the future, improve the policy and governance systems for promoting the development of strategic industries such as next-generation information technology, artificial intelligence, aviation and aerospace, new energy, new materials, high-end equipment, biomedicine, and quantum technology, and steer emerging industries toward sound and orderly development. National standards will be elevated to guide the upgrading of traditional industries, and enterprises will also be encouraged to apply digital, intelligent, and green technologies to transform and upgrade these sectors. We will impose tighter institutional constraints for environmental protection and safety.

New quality productive forces (新质生产力) had been predicted by many China watchers, based on articles and official documents released before this plenary session, to be one of the themes of this third plenary session. The resolution which was made public today explained the reform plan on new quality productive forces in one of its 60 subsections, mentioning specific industrial sectors such as artificial intelligence, aviation and aerospace, new energy, new materials, high-end equipment, biomedicine, and quantum technology. I believe this list is quite representative, although new quality productive forces is not limited to these areas.

健全相关规则和政策，加快形成同新质生产力更相适应的生产关系，促进各类先进生产要素向发展新质生产力集聚，大幅提升全要素生产率。鼓励和规范发展天使投资、风险投资、私募股权投资，更好发挥政府投资基金作用，发展耐心资本。

Relevant rules and policies will be improved to accelerate the formation of relations of production that are more compatible with new quality productive forces, and to channel various types of advanced production factors toward the development of new quality productive forces. These steps will help realize a significant increase in total factor productivity. We will encourage and regulate the development of angel investment, venture capital, and private equity investment, better leverage the role of government investment funds, and work to promote the development of patient capital.

On April 30, the Politburo met to discuss the dates for the third plenum session this year. During that meeting, “venture capital” was specifically mentioned as something to be supported, and the term “patient capital“ made its very first debut in a top-level official document. For a deeper understanding of patient capital in China and the latest policy initiatives aimed at stimulating venture capital development, I recommend reading a piece on this issue from Baiguan.

Baiguan - China Insights, Data, Context

China's first major policy response to its VC crisis

2 months ago, I wrote an article about China’s dying VC industry. More than 150,000 people have since read the original Chinese version, while the English version has ranked among the most popular articles in this newsletter. What I wrote about is nothing revolutionary. The fact that it went viral showed it resonated so well with the visceral experience of many people. My takeaway from creating this viral article is that it’s not really me who made it viral, but a collective emotion that has been brewing for quite some time, and it only took a small spark from me to ignite the fire…

Read more

2 years ago · 27 likes · Robert Wu

3.Self-reliant industrial and supply chain

健全提升产业链供应链韧性和安全水平制度。抓紧打造自主可控的产业链供应链，健全强化集成电路、工业母机、医疗装备、仪器仪表、基础软件、工业软件、先进材料等重点产业链发展体制机制，全链条推进技术攻关、成果应用。

(12) Improving the systems for enhancing the resilience and security of industrial and supply chains

We will move faster to build industrial and supply chains that are self-supporting and risk-controllable, improve the institutions and mechanisms for bolstering key industrial chains such as integrated circuits, industrial machine tools, medical equipment, instruments, basic software, industrial software, and advanced materials, and strive to secure more technological breakthroughs that can be applied across entire industrial and supply chains.

Note that when referring to build industrial and supply chains that are self-supporting and risk-controllable, the Chinese term used is "抓紧". This is the only instance where "抓紧" appears in the text. "抓紧" means to prioritize or act promptly on something, emphasizing the urgency and importance of addressing it without delay. When compared with another commonly used term in Chinese official documents, "加快", which translates to "speed up" or "accelerate", "抓紧" carries a more immediate sense of urgency in its literal meaning.

I did not see the use of "抓紧" in the report of the 20th Party Congress or China's 14th Five-Year Plan, which probably indicates the central government's assessment of the current international situation and underlines the urgency they attribute to establishing a self-reliant industrial and supply chain.

4.High-risk, high-reward basic research

加强有组织的基础研究，提高科技支出用于基础研究比重，完善竞争性支持和稳定支持相结合的基础研究投入机制，鼓励有条件的地方、企业、社会组织、个人支持基础研究，支持基础研究选题多样化，鼓励开展高风险、高价值基础研究。

Regions, enterprises, social organizations, and individuals with the resources to support basic research will be encouraged to do so. We will also support researchers in diversifying their subjects for study and encourage high-risk, high-reward basic research.

China has always emphasized the importance of basic research. However, effectively integrating basic research with practical applications has consistently been a challenge. The mention of supporting researchers in diversifying their subjects for study and encouraging high-risk, high-reward research was not noted in the reports of the 20th National Congress nor the 14th Five-Year Plan. This statement, I believe, also reflects the decision-makers' deep understanding of the significance of basic research and the uncertainty of its outcomes. I view this direction as positive, further clarifying the need to boldly engage in high-risk basic research.

5. National strategic planning system and policy coordination mechanisms

完善国家战略规划体系和政策统筹协调机制。构建国家战略制定和实施机制，加强国家重大战略深度融合，增强国家战略宏观引导、统筹协调功能。健全国家经济社会发展规划制度体系，强化规划衔接落实机制，发挥国家发展规划战略导向作用，强化国土空间规划基础作用，增强专项规划和区域规划实施支撑作用。健全专家参与公共决策制度。

(16) Improving the national strategic planning system and policy coordination mechanisms

We will develop mechanisms for formulating and executing national strategies and make a stronger push to fully integrate all major strategies, so that they can provide better macro guidance and overall coordination. The systems for national economic and social development planning will be improved. This will see us enhancing the mechanisms for the alignment and implementation of plans, better harnessing the strategic guiding role of national development plans, bolstering the basic role of territorial space plans, and reinforcing the supporting role of subject-specific plans and regional plans. We will also improve the system by which experts participate in decision-making on public issues.

Chinese experts have channels to provide policy advice to decision-makers, and I've always been curious about the influence of these channels. This aligns with what I recently learned from relevant departments: the authorities are refining the advisory mechanism. Therefore, I believe that while the content experts publicly disclose may not fully align with their internal advisory communications, it still holds significant referential value. This is also why many newsletters on China translate content from Chinese experts for internantional audience, to provide insight into these perspectives.

6. Place more fiscal resources at the disposal of local governments

建立权责清晰、财力协调、区域均衡的中央和地方财政关系。增加地方自主财力，拓展地方税源，适当扩大地方税收管理权限。完善财政转移支付体系，清理规范专项转移支付，增加一般性转移支付，提升市县财力同事权相匹配程度。建立促进高质量发展转移支付激励约束机制。推进消费税征收环节后移并稳步下划地方，完善增值税留抵退税政策和抵扣链条，优化共享税分享比例。

We will establish a fiscal relationship between the central and local governments that features well-defined powers and responsibilities and the appropriate allocation of resources, with an optimum balance between regions. To place more fiscal resources at the disposal of local governments, we will expand the sources of tax revenue at the local level and grant greater authority for tax management to local governments as appropriate. To improve the system of transfer payments, we will overhaul special transfer payments and increase the scale of general transfer payments. These will help ensure that the fiscal resources of prefecture- and county-level governments are commensurate with their powers. We will establish incentive and constraint mechanisms through transfer payments to promote high-quality development. We will take steps to move excise tax collection further down the production-to-consumption chain, with the power of collection steadily being passed to local governments. We will improve the value-added tax credit refund policy and free up the channels for making tax deductions. The ratio for taxes shared between the central and local governments will be optimized.

Looking back now, it's clear that David Daokui Li's comments at the CCG luncheon about increasing local tax revenue and the proposal to allocate consumption tax to local governments were probably not unfounded.

Pekingnology

3rd Plenum Pulse: What to Expect (2)

The Communist Party of China has said the upcoming Third Plenary Session of its current 20th Central Committee will focus on “deepening comprehensive reform to advance Chinese modernization.” Based on past practice and some recent public reports, Beijing is drafting its agenda now, but details are hard to come by…

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2 years ago · 17 likes · 2 comments · Zichen Wang

The third area of reform I very much look for is determining the incentives of local governments from production to consumption, possibly by leaving some of the tax collected from local enterprises to regions and cities where cars, motorcycles, bicycles, and electronic products are sold. If your region is able to generate a smooth consumption, fine, the VAT and the tax associated with the consumption should go to you. We should change the incentive. I think this is coming now.

Li is Professor and Director of the Academy of Chinese Economic Thought and Practice (ACCEPT) at Tsinghua University. From the Explanation of the Resolution by Xi Jinping, it was evident that as early as May, this proposal had already been shown internally to certain individuals.

2024年5月7日，决定稿下发党内一定范围征求意见，征求党内老同志意见，专门听取各民主党派中央、全国工商联负责人和无党派人士代表意见，听取相关企业和专家学者意见。

On May 7, 2024, the text of the resolution was issued to select Party members, including retired senior Party officials, for consultation. Opinions were also sought from the central committees of other political parties, from leaders of the All-China Federation of Industry and Commerce, from prominent figures without party affiliation, and from relevant enterprises, scholars, and experts.

It's uncertain whether Li Daokui, who can be regarded as prominent figures without party affiliation and, of course, an expert, had seen it by then. But some local governments are indeed facing financial pressures. Appropriately granting more tax revenue powers to local authorities can help alleviate their financial strains.

7.Taiwan

发挥“一国两制”制度优势，巩固提升香港国际金融、航运、贸易中心地位，支持香港、澳门打造国际高端人才集聚高地，健全香港、澳门在国家对外开放中更好发挥作用机制。深化粤港澳大湾区合作，强化规则衔接、机制对接。完善促进两岸经济文化交流合作制度和政策，深化两岸融合发展。

Harnessing the institutional strengths of the One Country, Two Systems policy, we will work to consolidate and enhance Hong Kong’s status as an international financial, shipping, and trade center, support Hong Kong and Macao in building themselves into international hubs for high-caliber talent, and improve relevant mechanisms to see the two regions playing a greater role in China’s opening to the outside world. We will encourage cooperation between Guangdong, Hong Kong, and Macao in the Greater Bay Area by promoting closer alignment of rules and mechanisms. We will improve relevant institutions and policies to promote economic and cultural exchanges and cooperation across the Taiwan Strait and advance integrated cross-Strait development.

This part seems to be the only one directly pertaining to Taiwan. Including it under the "One Country, Two Systems" policy framework suggests that China's fundamental strategy for a peaceful resolution of the Taiwan issue remains consistent. Furthermore, the mention of advancing integrated cross-Strait development aligns with the direction established by last year's initiative to develop Fujian as a zone for integrated development with Taiwan.

8.Raise the statutory retirement age

积极应对人口老龄化，完善发展养老事业和养老产业政策机制。发展银发经济，创造适合老年人的多样化、个性化就业岗位。按照自愿、弹性原则，稳妥有序推进渐进式延迟法定退休年龄改革。

To actively respond to population aging, we will refine the policies and mechanisms for developing elderly care programs and industries. We will develop the silver economy and support the creation of diverse jobs tailored to elderly people. In line with the principle of voluntary participation with appropriate flexibility, we will advance reform to gradually raise the statutory retirement age in a prudent and orderly manner.

Delaying retirement is a sensitive topic, touching on everyone's interests. Considering the current employment challenges faced by young people in China, adopting a more flexible and voluntary approach to delaying retirement aligns more closely with public opinion and the actual situation. I have discussed this topic on the "Got China" program about a month ago.

9. Strictly control the total number of community-level inspections

深入推进党风廉政建设和反腐败斗争。健全政治监督具体化、精准化、常态化机制。锲而不舍落实中央八项规定精神，健全防治形式主义、官僚主义制度机制。持续精简规范会议文件和各类创建示范、评比达标、节庆展会论坛活动，严格控制面向基层的督查、检查、考核总量，提高调研质量，下大气力解决过频过繁问题。

(59) Intensifying efforts to improve conduct, build integrity, and combat corruption

Mechanisms for conducting concrete, targeted, and regular political oversight will be improved. We will steadfastly implement the central Party leadership’s eight-point decision on improving conduct and refine our systems and mechanisms for preventing and tackling pointless formalities and bureaucratism. We will continue to streamline and standardize meetings and documents, as well as all types of demonstration initiatives, evaluations, standards inspections, festival celebrations, expositions and exhibitions, and forums; strictly control the total number of community-level inspections, examinations, and evaluations; and raise the quality of research and studies. Great effort will be made to address the excessive frequency of all these activities.

The Chinese term "下大气力" "great effort will be made or exert great efforts" appears uniquely here and signifies a stronger commitment compared to other commonly used term in Chinese official documents such as “加强 strengthen" or “努力 strive." This suggests that the issues requiring significant effort to address are particularly challenging and not easily resolved. It highlights that the problem of overly frequent of community-level inspections, examinations, and evaluations might be quite prominent.

I recall Premier Li Qiang once remarked, "I have worked in local governments for a long time. My experience is that when you sit in the office, you see lots of problems. But when you reach out to the people, you see all kinds of solutions." This illustrates that community-level inspections are a prevalent and effective approach within the Chinese system for identifying and addressing issues. This part from the resolution indicates that the CPC leadership is increasingly prioritizing the enhancement of the quality of community-level inspections, recognizing at the higher levels that quality supersedes quantity.

10.The establishment of a bankruptcy system for individual persons

健全企业破产机制，探索建立个人破产制度，推进企业注销配套改革，完善企业退出制度。健全社会信用体系和监管制度。

We will refine the enterprise bankruptcy mechanism, explore the establishment of a bankruptcy system for individual persons, move ahead with integrated reforms concerning the deregistration of enterprises, and improve the market exit system. We will also improve the social credit system and related oversight institutions.

China is currently facing a significant economic transformation, and establishing a bankruptcy system for individual persons would be beneficial in reducing judicial costs, preventing financial risks, maintaining financial stability, enhancing the overall innovative vitality of society, and improving the business environment. There are abundant comparative law legislative examples to draw from, and other related laws in China have already laid some groundwork for establishing a bankruptcy system for individual persons.

FULL TEXT

Resolution of the Central Committee of the Communist Party of China on Further Deepening Reform Comprehensively to

Advance Chinese Modernization

(Adopted at the third plenary session of the 20th Central Committee of the Communist Party of China on July 18, 2024)

In order to implement the strategic plans made at the 20th National Congress of the Communist Party of China (CPC), the 20th CPC Central Committee studied the issue of further deepening reform comprehensively to advance Chinese modernization at its third plenary session. On this basis, it adopted this resolution.

I. Great Significance and Overall Requirements

(1) Importance and necessity

Reform and opening up have been crucial to the cause of the Party and the people, enabling us to catch up with the times in great strides. The third plenary session of the 11th CPC Central Committee was a landmark event that ushered in a new period: one of reform, opening up, and socialist modernization. The third plenary session of the 18th CPC Central Committee was also of epoch-making significance. It marked the start of a new journey of comprehensively deepening reform in the new era with systematic and holistic plans, thus paving the way for a brand new stage in China’s reform and opening up endeavors.

The Party Central Committee with Comrade Xi Jinping at its core has, with great historical initiative, tremendous political courage, and a strong sense of mission, united and led the entire Party, the military, and Chinese people of all ethnic groups in unshackling their thinking and breaking down the barriers erected by vested interests. We have dared to brave uncharted waters, grapple with tough problems, and navigate potential dangers and have worked resolutely to remove institutional obstacles in all areas. As a result, reform has evolved from a variety of trials and breakthroughs limited to certain areas into an integrated drive being advanced across the board. Foundational institutional frameworks have been basically put in place in all sectors, and historic, systemic, and holistic transformations have been achieved in many fields. Overall, we have accomplished the reform tasks set at the third plenary session of the 18th Central Committee and attained our objective of achieving marked results in making all institutions more mature and better-defined by the time of the Party’s centennial in 2021. All this has provided strong institutional support for completing the First Centenary Goal of building a moderately prosperous society in all respects and set China on a new journey toward building a modern socialist country in all respects.

The present and the near future constitute a critical period for our endeavor to build a great country and move toward national rejuvenation on all fronts through Chinese modernization. As Chinese modernization has been advanced continuously through reform and opening up, it will surely embrace broader horizons through further reform and opening up. To deal with complex developments both at home and abroad, adapt to the new round of scientific and technological revolution and industrial transformation, and live up to the new expectations of our people, it is vital that we continue to advance reform. Advancing reform is essential for upholding and improving the system of socialism with Chinese characteristics and modernizing China’s system and capacity for governance, for putting the new development philosophy into practice and better adapting to the evolution in the principal contradiction in Chinese society, and for adhering to a people-centered approach to see that the gains of modernization benefit all our people fairly. It is also crucial for responding to major risks and challenges and ensuring steady and sustained progress in the cause of the Party and the country, for promoting the development of a human community with a shared future and winning the strategic initiative amid accelerating global changes of a like not seen in a century, and for further advancing the great new project of Party building in the new era and making our Marxist party stronger. Reform and opening up are an ongoing endeavor rather than a task to be completed. All of us in the Party must consciously give more prominence to reform and further deepen reform comprehensively with a view to advancing Chinese modernization.

(2) Guiding philosophy

We must stay committed to Marxism-Leninism, Mao Zedong Thought, Deng Xiaoping Theory, the Theory of Three Represents, and the Scientific Outlook on Development and fully implement Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. We must thoroughly study and implement General Secretary Xi Jinping’s new ideas, viewpoints, and conclusions on comprehensively deepening reform and fully and faithfully apply the new development philosophy on all fronts. We must adhere to the general principle of pursuing progress while ensuring stability and continue to free our minds, seek truth from facts, move with the times, and take a realistic and pragmatic approach, as we work to further unleash and develop the productive forces and tap into and boost the vitality of our society. Keeping in mind both domestic and international imperatives, we will ensure coordinated implementation of the Five-Sphere Integrated Plan and the Four-Pronged Comprehensive Strategy.([1]) Regarding economic structural reform as the spearhead and greater social fairness and justice and increased wellbeing of the people as our ultimate objectives, we will channel greater energy into making our reforms integrated, focused, and effective. We will work to better adapt the relations of production to the productive forces, the superstructure to the economic base, and national governance to social development so as to provide strong impetus and institutional support for Chinese modernization.

(3) Overall objectives

We will continue to improve and develop the system of socialism with Chinese characteristics and modernize China’s system and capacity for governance. By 2035, we will have finished building a high-standard socialist market economy in all respects, further improved the system of socialism with Chinese characteristics, generally modernized our system and capacity for governance, and basically realized socialist modernization. All of this will lay a solid foundation for building China into a great modern socialist country in all respects by the middle of this century. In particular, we will focus on achieving the following objectives:

—Building a high-standard socialist market economy. We will see that the market plays the decisive role in resource allocation and that the government better fulfills its role. We will uphold and improve China’s basic socialist economic systems, achieve greater self-reliance and strength in science and technology, and promote high-standard opening up. We will build a modernized economy, move faster to create a new pattern of development, and promote high-quality development.

—Advancing whole-process people’s democracy. We will uphold the unity between leadership by the Party, the running of the country by the people, and law-based governance. We will improve the institutions through which the people run the country, promote extensive, multilevel, and institutionalized development of consultative democracy, and refine the system of socialist rule of law with Chinese characteristics. We will move to a higher stage in building a socialist country under the rule of law.

—Developing a strong socialist culture in China. We will uphold the foundational system for ensuring the guiding role of Marxism in the ideological domain and improve the institutions and mechanisms for developing cultural programs and industries. We will promote cultural prosperity, enrich the intellectual and cultural lives of our people, and enhance China’s cultural soft power and the appeal of Chinese culture.

—Improving the people’s quality of life. We will refine the income distribution, employment, and social security systems, make basic public services more balanced and accessible, and facilitate more notable, substantive progress in promoting people’s well-rounded development and common prosperity for all.

—Building a Beautiful China. We will ramp up the green transition in all areas of economic and social development and improve the environmental governance system. We will prioritize ecological protection, conserve resources and use them efficiently, and pursue green and low-carbon development, with a view to promoting harmony between humanity and nature.

—Advancing the Peaceful China Initiative to a higher level. We will strengthen the national security system, enhance integration between national strategies, and improve our capacity to safeguard national security. We will create new institutions, mechanisms, and methods for social governance and build a new security architecture.

—Improving the Party’s capacity for leadership and long-term governance. We will develop new and improved ways of exercising leadership and governance, deepen institutional reforms related to Party building, and improve the system for exercising full and rigorous Party self-governance.

The reform tasks laid out in this resolution shall be completed by the time the People’s Republic of China celebrates its 80th anniversary in 2029.

(4) Guiding principles

On the basis of reviewing and applying the valuable experience we have gained since the launch of reform and opening up, particularly from our endeavor to comprehensively deepen reform in the new era, we will implement the following principles:

• Upholding the Party’s overall leadership. We must firmly uphold the Central Committee’s authority and its centralized, unified leadership and ensure that the Party fulfills its core role of exercising overall leadership and coordinating the efforts of all sides. We must ensure that Party leadership is exercised in every aspect and throughout the entire process of reform so that it always advances in the correct political direction.

• Adhering to a people-centered approach. We must respect the principal position and pioneering spirit of the people and make our reform measures highly responsive to the call of the people, so as to ensure that reform is for the people and by the people and that its fruits are shared among the people.

• Upholding fundamental principles and breaking new ground. Staying committed to socialism with Chinese characteristics, we must keep pace with the times, adapt to the evolution of practice, and take a problem-oriented approach, so that from a new starting point, we can promote innovations in theory and practice, in our institutions and culture, and in all other aspects.

• Strengthening institutional building as our main task. We must strengthen top-level design and overall planning, always establishing new systems before abolishing old ones while attaching equal importance to efforts in both respects. We must consolidate foundational systems, refine basic systems, and innovate important systems.

• Staying committed to law-based governance on all fronts. We must deepen reform and advance Chinese modernization under the rule of law and ensure unity between reform and the rule of law, seeing that all major reforms have a solid legal basis and that reform achievements are elevated to law in a timely manner.

• Applying systems thinking. We must properly handle the major relationships between the economy and society, between the government and the market, between efficiency and fairness, between vitality and order, and between development and security, thus pursuing reform in a more systematic, holistic, and coordinated manner.

II. Building a High-Standard Socialist Market Economy

A high-standard socialist market economy provides an important guarantee for Chinese modernization. We must better leverage the role of the market, foster a fairer and more dynamic market environment, and make resource allocation as efficient and productive as possible. We need to lift restrictions on the market while ensuring effective regulation and strive to better maintain order in the market and remedy market failures. By doing so, we will ensure smooth flows in the national economy and unleash the internal driving forces and creativity of the whole of society.

(5) Upholding and fulfilling the commitments to the public and non-public sectors

We will stay committed to unswervingly consolidating and developing the public sector and unswervingly encouraging, supporting, and guiding the development of the non-public sector. We will ensure that economic entities under all forms of ownership have equal access to factors of production in accordance with the law, compete in the market on an equal footing, and are protected by the law as equals, thus enabling them to complement each other and develop side by side.

We will deepen reform of state capital and state-owned enterprises (SOEs), improving the institutions and mechanisms for management and oversight, strengthening strategic coordination between relevant administrative departments, and working to refine the layout of the state-owned sector and adjust its structure. All this will help state capital and SOEs get stronger, do better, and grow bigger, with their core functions and core competitiveness enhanced. We will clearly define the functions of different types of SOEs, improve the management of their primary responsibilities and core business, and identify the key areas and orientations for state capital investment. State capital will be steered toward major industries and key fields that are vital to national security and serve as the lifeblood of the national economy, toward sectors such as public services, emergency response, and public welfare, which concern our country’s prosperity and our people’s wellbeing, and toward forward-looking and strategic emerging industries. The institutional framework under which SOEs pursue original innovation will be improved, and the reform of state capital investment and operation companies will be continued. We will establish a system to assess SOEs’ performance in fulfilling their strategic missions, refine the category-based SOE evaluation system, and introduce value-added accounting in the state-owned sector. While promoting independent operation of natural monopoly businesses in sectors such as energy, railway, telecommunications, water conservancy, and public utilities, we will advance market-oriented reforms in the competitive areas of these sectors and improve regulatory institutions and mechanisms.

We will continue to implement principles and policies that help foster a favorable environment and create more opportunities for the development of the non-public sector. We will formulate a private sector promotion law. We will do more to remove barriers to market access, work to see that the competitive areas of infrastructure are open to market entities in a fair manner, and improve the long-term mechanism by which private enterprises participate in major national projects. We will support capable private enterprises in leading national initiatives to make breakthroughs in major technologies and provide private enterprises with greater access to major national scientific research infrastructure. We will refine financing support policies and systems for private enterprises to resolve the difficulties they face in accessing affordable financing. We will improve the legal framework for the long-term regulation of charges levied on enterprises and for clearing overdue payments owed to them. We will move faster to set up a system for comprehensively evaluating private enterprises’ credit status and refine the credit enhancement system for small and medium private enterprises. We will support and guide private enterprises in improving their governance structures and management systems, building up compliance capacity, and better preventing corruption-related risks. We will strengthen ongoing and ex post oversight and regulate administrative inspections on private enterprises.

We will refine the modern corporate system with distinctive Chinese features and promote entrepreneurial spirit. We will support and guide enterprises of all types as they work to use resources and production factors more efficiently, improve their operation and management, and fulfill their social responsibilities. Efforts will be accelerated to foster a greater number of world-class enterprises.

(6) Building a unified national market

We will work to see that the underlying institutions and rules of the market are unified, that market regulation is exercised in an impartial and unified manner, and that connectivity between market facilities is built to high standards. We will enhance the binding force of fair competition review, take stronger action against monopolies and unfair competition, and review and abolish regulations and practices that impede the development of a unified national market and fair competition. We will bring local regulations and institutions for attracting investment under regulation and strictly prohibit policy incentives in breach of laws and regulations. We will establish sound, unified, and well-regulated public resource trading platforms that facilitate information sharing. Such platforms will cover public bidding as well as procurement by the government, public institutions, and SOEs and ensure full transparency throughout the project management process. Overall market regulation capabilities will be enhanced. We will refine the national system of standards and deepen reform of local systems for standards management.

The institutions and rules for production factor markets will be improved to facilitate the smooth flow of production factors, the efficient allocation of all types of resources, and the full realization of market potential. We will develop a unified market for urban and rural land designated for construction. We will refine the underlying systems for promoting well-regulated development of the capital market and foster an integrated national market for technology and data. By refining the mechanisms whereby production factors are priced primarily based on market supply and demand, we will prevent improper government interference in pricing. We will also develop better mechanisms to ensure the contributions of production factors, such as labor, capital, land, knowledge, technology, management, and data, are determined by the market and rewarded accordingly. Pricing reforms will be continued in sectors such as water, energy, and transportation, and the tiered pricing mechanisms for household water, electricity, and natural gas consumption will be improved, as will the pricing mechanism for refined petroleum products.

We will improve the commodity distribution system, speed up the development of the Internet of Things, and further refine the integrated framework of distribution rules and standards to cut logistics costs throughout society. We will deepen reform of the energy management system, build a unified national electricity market, and improve the operation and coordination mechanisms for oil and gas pipelines.

We will step up efforts to develop a complete domestic demand system. To this end, we will set up long-term government investment mechanisms to support the development of major projects that are of fundamental and far-reaching importance and serve the public interest; refine the institutions and mechanisms that enable government investment to effectively drive nongovernmental investment; further reform the investment review and approval system; improve the mechanisms for stimulating and facilitating nongovernmental investment; and create a market-driven mechanism for ensuring self-sustaining growth of effective investment. We will refine long-term mechanisms for expanding consumption, reduce relevant restrictions, boost public spending as necessary, and actively promote the debut economy.

(7) Refining the systems underpinning the market economy

We will improve the property rights system to ensure law-based, equitable protection of the property rights of economic entities under all forms of ownership on a long-term basis and establish an efficient system for the comprehensive management of intellectual property rights. We will refine the market information disclosure system and put in place a commercial secrets protection system. All economic entities, regardless of their form of ownership, will be treated as equals when their property rights and legal interests are infringed upon or they infringe upon the property rights and legal interests of others. We will also refine the punitive compensation system. We will work to bolster law enforcement and justice administration to protect property rights, prevent and rectify administrative and criminal interference in economic disputes, and refine the mechanisms for identifying and redressing wrongly adjudicated cases involving enterprises in accordance with the law.

We will refine the market access system to ensure greater accessibility for new forms of business and new sectors. We will deepen reform of the business registration system based on subscribed registered capital and ensure that subscriptions are paid on time as stipulated by law. We will refine the enterprise bankruptcy mechanism, explore the establishment of a bankruptcy system for individual persons, move ahead with integrated reforms concerning the deregistration of enterprises, and improve the market exit system. We will also improve the social credit system and related oversight institutions.

III. Promoting High-Quality Economic Development

High-quality development is our primary task in building China into a modern socialist country in all respects. It is essential that we apply the new development philosophy to steer reform and ground our efforts in the new stage of development. We must deepen supply-side structural reform, improve incentive and constraint mechanisms for promoting high-quality development, and strive to create new growth drivers and strengths.

(8) Improving the institutions and mechanisms for fostering new quality productive forces in line with local conditions

We will work to facilitate revolutionary breakthroughs in technology, innovative allocation of production factors, in-depth industrial transformation and upgrading, and the optimal combination of laborers, means of labor, and subjects of labor as well as their renewal and upgrading. All this will give rise to new industries, new business models, and new growth drivers and promote the development of productive forces that are characterized by high technology, high performance, and high quality. A stronger push will be made to pursue innovation in key generic technologies, cutting-edge technologies, modern engineering technologies, and disruptive technologies, and institutional supply will be boosted in new areas and arenas. We will establish a mechanism for ensuring funding increases for industries of the future, improve the policy and governance systems for promoting the development of strategic industries such as next-generation information technology, artificial intelligence, aviation and aerospace, new energy, new materials, high-end equipment, biomedicine, and quantum technology, and steer emerging industries toward sound and orderly development. National standards will be elevated to guide the upgrading of traditional industries, and enterprises will also be encouraged to apply digital, intelligent, and green technologies to transform and upgrade these sectors. We will impose tighter institutional constraints for environmental protection and safety.

Relevant rules and policies will be improved to accelerate the formation of relations of production that are more compatible with new quality productive forces, and to channel various types of advanced production factors toward the development of new quality productive forces. These steps will help realize a significant increase in total factor productivity. We will encourage and regulate the development of angel investment, venture capital, and private equity investment, better leverage the role of government investment funds, and work to promote the development of patient capital.

(9) Improving the systems for promoting full integration between the real economy and the digital economy

We will move faster to advance new industrialization, promote the growth and expansion of advanced manufacturing clusters, and make the manufacturing sector higher-end, smarter, and more eco-friendly. We will set up a number of industrial generic technology platforms, accelerate the transformation of industrial models and organizational forms of enterprises, and refine the institutions and mechanisms for enhancing our leading position in industries where we excel. We will establish better operation and oversight mechanisms for major industrial investment funds to ensure that capital is channeled toward our country’s strategic needs. We will put in place a funding mechanism to see that the share of manufacturing in the national economy remains at a desirable level. We will also realize a reasonable reduction in overall costs and tax and fee burdens in the manufacturing sector.

We will move faster to establish institutions and mechanisms for promoting the development of the digital economy and refine the policy system for developing the digital industry and transforming traditional industries with digital technologies. We will promote faster application of next-generation information technology at all stages and in all dimensions, develop the Industrial Internet, and build digital industry clusters with international competitiveness. We will push forward the innovative development of the platform economy while improving the system for its routine regulation. We will build and put into operation national data infrastructure to promote data sharing. We will work faster to set up a system for data property rights concerning ownership determination, market transaction, proceeds distribution, and interests protection. We will boost our governance and regulatory capabilities in relation to data security and put in place a mechanism to ensure efficient, convenient, and safe cross-border data flows.

(10) Refining the institutions and mechanisms for developing the service sector

We will refine the policy system for supporting the development of the service sector, improve financial accounting, and promote standardization in this sector. With a focus on key links, we will propel high-quality development of producer services on a sector-by-sector basis, invigorate industrial internet platforms, remove administrative barriers that impede trans-regional business operations, and promote the integrated development of producer services. The mechanisms for accelerating the diversified development of consumer services will be improved. We will refine the system of rules and regulations for intermediary service agencies to ensure that they operate in an honest and trustworthy way and fulfill their responsibilities in accordance with the law.

(11) Improving the institutions and mechanisms for modernizing infrastructure

We will build a planning and standards system for new types of infrastructure and improve the mechanisms for integrated utilization of such infrastructure. We will advance the digitalization of traditional infrastructure, diversify investment and financing channels, and refine the coordination mechanisms for major infrastructure construction projects. We will further reform the integrated transportation system, advancing reform of the railway system, developing general aviation and the low-altitude economy, and optimizing the policy on toll highways. We will raise the underwriting capacity of shipping insurers, help them provide better global services, and introduce new systems and rules on the arbitration of marine affairs. We will improve the mechanisms for the construction, operation, and management of major water conservancy projects.

(12) Improving the systems for enhancing the resilience and security of industrial and supply chains

We will move faster to build industrial and supply chains that are self-supporting and risk-controllable, improve the institutions and mechanisms for bolstering key industrial chains such as integrated circuits, industrial machine tools, medical equipment, instruments, basic software, industrial software, and advanced materials, and strive to secure more technological breakthroughs that can be applied across entire industrial and supply chains. A mechanism will be put in place to assess and respond to industrial and supply chain risks. We will improve the coordination mechanism for industries to be relocated domestically in a progressive and orderly manner and promote interest sharing between regions of origin and destination. We will develop China’s strategic hinterland and ensure backup plans for key industries. Accelerated moves will be made to improve the system for national reserves. We will refine the overall planning and linkage systems for the exploration, production, supply, storage, and sale of strategic mineral resources.

IV. Supporting All-Around Innovation

Education, science and technology, and talent function as basic and strategic underpinnings for Chinese modernization. We must fully implement the strategy of invigorating China through science and education, the strategy of developing a quality workforce, and the innovation-driven development strategy, make coordinated efforts to promote integrated reform of institutions and mechanisms pertaining to education, science and technology, and talent, and improve the new system for mobilizing resources nationwide, so as to boost the overall performance of our country’s innovation system.

(13) Deepening comprehensive reform in education

We will work faster to build a high-quality education system and advance coordinated reforms in student training methods, school operation models, management systems, and support mechanisms. We will improve the mechanisms for fostering virtue through education, introduce integrated reforms and new approaches in the political education curriculum at all levels, from elementary school to university, and refine the systems for nurturing capable young people with sound moral grounding, intellectual ability, physical vigor, aesthetic sensibility, and work skills. We will increase the ability of teachers to impart knowledge and bring out the best in students and improve the long-term mechanisms for enhancing their professional integrity and conduct. In addition, we will further educational assessment reforms. We will improve the layout of higher education and work faster to develop world-class universities and strong disciplines with Chinese features. We will advance reforms of higher education institutions on a categorized basis and develop discipline adjustment mechanisms and talent training models to meet the needs of China’s scientific and technological development and national strategies. This will see us making extraordinary moves to plan for disciplines and majors that are in urgent demand. We will also redouble efforts to develop basic disciplines, emerging disciplines, and interdisciplinary subjects and work harder to cultivate top talent, with a strong emphasis on fostering innovative capacity. We will refine the mechanisms for facilitating scientific and technological innovation in universities and ensure more efficient application of advances. Scientific and technological education and humanities education will be better coordinated. We will work faster to build a vocational education system that is well-integrated with both general education and industry and improve the mechanisms for student internships and work experience. We will better guide and regulate the development of private schools. We will promote high-standard opening up in the education sector, and encourage first-rate foreign universities of science and engineering to develop partner schools and programs in China.

With a view to optimizing the allocation of educational resources across regions, we will establish mechanisms for aligning the supply of basic public education services with demographic changes. We will improve the mechanisms for promoting high-quality, balanced development of compulsory education and explore avenues for gradually expanding the coverage of free education. The support mechanisms for preschool education, special needs education, and specialized education will be improved. We will also pursue the digitalization of education to facilitate the building of a learning society and provide greater support for lifelong education.

(14) Deepening scientific and technological structural reform

Targeting the global frontiers of science and technology, the development of the economy, the major needs of the country, and the health and safety of our people, we will refine the mechanisms under which major scientific and technological innovation projects are organized in order to mount a concerted push for breakthroughs in core technologies in key fields. We will see that the development of innovative capabilities, allocation of innovation factors, and ranks of innovators become more systematic, well-organized, and coordinated. To boost China’s strength in strategic science and technology, we will refine the system of national laboratories and better define the roles and layout of our national research institutions, advanced-level research universities, and leading high-tech enterprises. We will promote closer collaboration between the central and local levels, work for coordinated development of technological innovation platforms of various kinds, and encourage and regulate the development of new types of R&D institutions. Giving play to the guiding role of China’s enormous market, we will see that innovation resources are more effectively allocated and that our innovative capabilities are better organized, with a view to promoting integrated advancements in technological and industrial innovation. We will establish risk monitoring, early warning, and response systems to safeguard science and technology security, and ensure self-sufficiency in scientific and technological infrastructure. The management system for science and technology-related social groups will be refined. We will expand international science and technology exchanges and cooperation, encourage the establishment of international science and technology organizations in China, and improve the management mechanisms whereby China’s universities, research institutes, and science and technology-related social groups engage in specialized exchanges and cooperation with their foreign counterparts.

We will improve the management of science and technology plans to ensure that they are forward-looking and play a guiding role in basic research, interdisciplinary frontier areas, and key fields. We will see that basic research is conducted in a better organized way, raise the share of total science and technology expenditure that goes toward basic research, and improve the basic research investment mechanisms to ensure support on both a competitive and ongoing basis. Regions, enterprises, social organizations, and individuals with the resources to support basic research will be encouraged to do so. We will also support researchers in diversifying their subjects for study and encourage high-risk, high-reward basic research. We will advance reform of the science and technology evaluation system, ensure that ethical standards are adhered to, and rectify academic misconduct.

Reinforcing the principal role of enterprises in innovation, we will establish mechanisms for fostering leading high-tech enterprises and strengthen enterprise-led collaboration between industries, universities, and research institutes. We will set up a reserve fund system for corporate R&D and back enterprises that volunteer to lead or participate in major national science and technology programs. Mechanisms will be rolled out to promote the development of small and medium enterprises (SMEs) that use specialized and sophisticated technologies to produce novel and unique products. To encourage sci-tech SMEs to boost their R&D spending, we will raise the rate of additional tax deductions for their R&D expenses. We will encourage and guide higher education institutions and research institutes in authorizing the use of their proprietary scientific and technological advances by micro, small, and medium enterprises on a “use first, pay later” basis.

We will refine the mechanisms for allocation, management, and utilization of central government research funds and improve the institutions for the implementation of central government-funded science and technology programs and their management by specialized agencies. We will expand application of the contract system for government-funded research projects and grant scientists a greater say in deciding on technology roadmaps, spending funds, and allocating resources. We will establish a mechanism for adopting non-consensus projects based on real-name recommendations by experts. Public institutions engaged in scientific research will be allowed to implement a more flexible management system as compared to general public institutions, so that they can explore approaches to instituting corporate management.

We will further reform the mechanisms for applying scientific and technological advances. We will enhance the national technology transfer system, move faster to plan and build a number of proof-of-concept and pilot-scale testing platforms, refine the policies for the initial application of newly-developed equipment, materials, and software, and increase government procurement of independently innovated products. The pool of technology managers will be expanded.

Scientists and engineers will have a greater say in the distribution of gains from the transfer of their scientific and technological advances. We will establish a system to place scientific and technological outputs produced on the job under separate management and deepen reforms to grant researchers corresponding rights over these outputs. We will push ahead with the income distribution reform for universities and research institutes. A greater number of eligible SOEs will be permitted to provide diverse medium- and long-term incentives to encourage innovation and creativity among their research personnel.

We will develop a financial system for scientific and technological innovation to provide greater support for major national science and technology programs and sci-tech SMEs. We will refine policies for supporting the investment of long-term capital in projects at the early stages, in small enterprises, over long time horizons, and in advanced and core technologies. We will improve the mechanisms for spreading the risks associated with the development of major technologies and introduce a policy system for technology insurance. We will facilitate foreign equity investment and venture capital investment in China.

(15) Deepening institutional reforms for talent development

Our policies on talent will become more proactive, open, and effective. To improve the mechanisms for nurturing talent here at home, we will work faster to develop national hubs for high-caliber personnel and platforms for attracting and pooling talent. We will step up efforts to build a contingent of personnel with expertise of strategic importance, with a focus on cultivating science strategists, top-notch scientists and innovation teams, outstanding engineers, master craftsmen, and highly-skilled workers, while also working to improve the performance of all types of talent. We will develop a first-rate industrial technical workforce. We will improve the mechanisms for enabling orderly flows of talent to promote a more rational distribution across regions and foster closer personnel collaboration between the eastern, central, and western regions. We will also enhance the mechanisms for identifying, selecting, and training young innovators and ensure better pay and benefits for our young scientists and engineers. Relevant systems will be refined to ensure that researchers can concentrate on research.

We will enhance the incentive mechanisms for talent, granting more say to employers and creating a more accommodating environment for talent development. We will put in place a personnel assessment system based on innovation-related capability, performance, outcomes, and contributions. We will open up channels to enable flows of personnel between universities and research institutes on the one hand and enterprises on the other. We will improve the support mechanisms for recruiting talent from overseas and create internationally competitive personnel systems. We will also explore avenues for establishing an immigration system for highly-skilled personnel.

V. Improving Macroeconomic Governance

Sound macro regulation, along with effective governance by the government, is essential for ensuring that we can fully leverage the institutional strengths of our socialist market economy. It is, therefore, vital that we improve our macro regulation systems. We must pursue coordinated reforms in the fiscal, tax, financial, and other major sectors and work to enhance the consistency of macro policy orientation.

(16) Improving the national strategic planning system and policy coordination mechanisms

We will develop mechanisms for formulating and executing national strategies and make a stronger push to fully integrate all major strategies, so that they can provide better macro guidance and overall coordination. The systems for national economic and social development planning will be improved. This will see us enhancing the mechanisms for the alignment and implementation of plans, better harnessing the strategic guiding role of national development plans, bolstering the basic role of territorial space plans, and reinforcing the supporting role of subject-specific plans and regional plans. We will also improve the system by which experts participate in decision-making on public issues.

To promote the implementation of national development plans and major strategies, we will foster greater synergy between our fiscal, monetary, industrial, pricing, and employment policies, improving the allocation of newly acquired resources and adjusting the mix of existing resources. We will explore the introduction of national macro balance sheet management. Both economic and non-economic policies will be evaluated to ensure that they are consistent with the macro policy orientation. The expectations management mechanism will be improved. We will refine the statistical indicators accounting system to better support high-quality development, expanding the coverage of statistics to include more new forms of economy and new sectors. We will promote the development of statistical infrastructure for industrial entities, optimize statistical methods for both headquarters and branches, and gradually work toward compiling statistics based on the places where market entities conduct their business activities. Steps will be taken to improve the mechanisms for international coordination on macro policies.

(17) Deepening reform of the fiscal and tax systems

We will further improve the budget system and strengthen unified management of all fiscal resources and budgets. All revenues generated on the basis of the exercise of administrative power, government credit, and state-owned resources and assets will be placed under government budget management. We will improve the budgeting and performance assessment systems for state capital operations and strengthen fiscal support for major national strategic tasks and basic public wellbeing. We will enhance macro guidance on budgeting and fiscal policies. We will strengthen performance management for public services, with a focus on conducting ex ante evaluations of their functions. Reforms for zero-based budgeting will be advanced. We will unify budget allocation powers, make budget management more unified and standardized, and take steps to boost budget transparency and enhance budget oversight. We will improve the system for comprehensive government financial reporting based on accrual accounting.

The tax structure will be improved to make taxation systems more conducive to high-quality development, social fairness, and the building of a unified market. We will also look into approaches for better adapting these systems to new forms of business. Fully implementing the principle of legality of taxation, we will regulate policies on tax breaks and improve the support mechanisms for key sectors and links. We will refine the system of direct taxes, improve the personal income tax system which is based on both adjusted gross income and specific income types, regulate taxation policies on incomes generated from business operations, capital, and property, and unify tax rates for incomes earned through work. Reform of the tax collection and administration system will be deepened.

We will establish a fiscal relationship between the central and local governments that features well-defined powers and responsibilities and the appropriate allocation of resources, with an optimum balance between regions. To place more fiscal resources at the disposal of local governments, we will expand the sources of tax revenue at the local level and grant greater authority for tax management to local governments as appropriate. To improve the system of transfer payments, we will overhaul special transfer payments and increase the scale of general transfer payments. These will help ensure that the fiscal resources of prefecture- and county-level governments are commensurate with their powers. We will establish incentive and constraint mechanisms through transfer payments to promote high-quality development. We will take steps to move excise tax collection further down the production-to-consumption chain, with the power of collection steadily being passed to local governments. We will improve the value-added tax credit refund policy and free up the channels for making tax deductions. The ratio for taxes shared between the central and local governments will be optimized. We will look into rolling the urban maintenance and construction tax, education surcharges, and local education surcharges into one single local surtax. Local governments will have the authority to set the rate for this tax within a predetermined range. We will appropriately expand the scope of use for funds raised from the sale of local government special-purpose bonds, permitting a greater share of such funds to be used as capital in more sectors and on a larger scale. The systems for managing government debt will be improved. We will establish a system for monitoring and regulating all local government debt as well as long-term mechanisms for preventing and defusing hidden debt risks. We will move faster to reform and transform local government financing platforms. In regulating the management of non-tax revenue, we will delegate, as appropriate, some management authority to local governments and allow them to tailor their practices to local conditions.

The central government will hold more fiscal powers as appropriate and raise the proportion of central government expenditure accordingly. In principle, the expenditures commensurate with such powers should be allocated from the central government, and such powers to be delegated to local governments should be reduced. No requirements for supporting funds from local governments in violation of regulations shall be made. When it is necessary to delegate fiscal powers to local governments, the relevant funds should be arranged through special transfer payments.

(18) Deepening reform of the financial system

We will move faster to improve the central bank system and the monetary policy transmission mechanism. We will actively develop technology finance, green finance, inclusive finance, pension finance, and digital finance and work to ensure quality financial services for major strategies, key fields, and weak links. We will refine the role and governance of financial institutions and the incentive and constraint mechanisms for ensuring that they serve the real economy. We will diversify equity financing, step up the development of multilevel bond markets, and increase the proportion of direct financing. We will optimize the state-owned financial capital management system.

We will improve the functions of the capital market to give balanced weight to investment and financing. We will prevent risks and tighten regulation to promote the sound and stable development of the capital market. We will facilitate the entry of long-term capital into the market. We will improve the overall quality of listed companies, strengthen relevant regulation and delisting systems, and establish long-term mechanisms to enhance the underlying stability of the capital market. We will improve the mechanisms for regulating and constraining the behaviors of major shareholders and actual controllers. We will optimize dividend incentive and constraint mechanisms for listed companies and improve the mechanisms for protecting investors. We will encourage regional equity markets to align their rules and implement unified standards.

A financial law will be formulated. We will improve the financial regulatory system to ensure that all financial activities are placed under regulation in accordance with the law, strengthen regulatory responsibility and accountability systems, and improve regulatory coordination between the central and local levels. We will build secure and efficient financial infrastructure, unify the rules and systems for registration, custody, settlement, and liquidation for the financial market, establish binding constraints for defusing risks at an early stage, and build a robust system to effectively fend off and control systemic risks and ensure financial stability. We will improve the mechanisms for protecting financial consumers and cracking down on illegal financial activities and establish a firewall for industrial and financial capital. We will promote high-standard opening up of the financial sector, steadily and prudently advance the internationalization of the RMB, and develop offshore RMB markets. We will make steady progress in the R&D and application of digital RMB and move faster to build Shanghai into an international financial center.

We will improve the management model based on pre-establishment national treatment plus a negative list and support qualified foreign capital institutions in participating in our financial service trials. We will expand the connectivity between domestic and overseas financial markets in a steady and prudent way and improve the qualified foreign institutional investor system. We will push forward the development of a homegrown, controllable cross-border payment system and strengthen financial security mechanisms as we open our doors wider to the outside world. We will establish a system for the unified monitoring and oversight of all foreign debt. We will actively participate in international financial governance.

(19) Improving mechanisms for implementing the coordinated regional development strategy

We will develop a regional economic layout and a territorial space system characterized by complementarity between different regions and territorial spaces. We will improve the institutional and policy frameworks for opening up a new vista in the large-scale development of the western region, achieving new breakthroughs in the full revitalization of the Northeast, accelerating the rise of the central region, and encouraging the eastern region to modernize more quickly. We will enable regions like the Beijing-Tianjin-Hebei region, the Yangtze River Delta, and the Guangdong-Hong Kong-Macao Greater Bay Area to better play their roles as engines of high-quality development and improve the mechanisms for the development of the Yangtze Economic Belt and the ecological protection and high-quality development in the Yellow River basin. We will move forward with the high-standard and high-quality development of the Xiong’an New Area. We will push for solid progress in developing the Chengdu-Chongqing economic zone. We will improve the system of institutions for functional zoning and strengthen mechanisms to support optimal development of territorial spaces. We will improve integrated regional development mechanisms, build new mechanisms for cooperative development across administrative divisions, and deepen industrial collaboration between the eastern, central, and western regions. The institutions and mechanisms for promoting the development of the marine economy will be enhanced.

VI. Promoting Integrated Urban-Rural Development

Integrated urban and rural development is essential to Chinese modernization. We must pursue coordinated progress in new industrialization, new urbanization, and all-around rural revitalization, facilitate greater urban-rural integration in planning, development, and governance across the board, and promote equal exchanges and two-way flows of production factors between urban and rural areas, so as to narrow the disparities between the two and promote their shared prosperity and development.

(20) Improving the institutions and mechanisms for advancing new urbanization

We will put in place mechanisms to foster positive interactions between the processes of industrial upgrading, population concentration, and urban development. We will implement the systems for allowing people to obtain household registration and access basic public services in their place of permanent residence. We will push to see that eligible people who have moved to cities from rural areas enjoy the same rights as registered local residents with regard to social insurance, housing support, and access to compulsory education for their children living with them. The process of granting permanent urban residency to these people will also be accelerated. We will protect the lawful land rights and interests of former rural residents who now hold permanent urban residency, protect, in accordance with the law, their rights to contract rural land, to use their rural residential land, and to share in the proceeds from rural collective undertakings, and explore avenues to facilitate voluntary, paid transfers of these rights.

We will continue to follow the principle that cities should be built by the people and for the people. We will improve urban planning to see that cities of different sizes and small towns develop in coordination with each other to form efficient and closely knit layouts. We will deepen reform of the urban development, operation, and governance systems and step up efforts to change the development models of cities. We will work to create new systems for smart and efficient governance in super-large and mega cities and establish institutions and mechanisms for the highly-integrated development of cities in metropolitan areas. We will deepen reforms to grant super-large towns economic and social management rights that are commensurate with their populations and economic sizes. We will develop sustainable urban renewal models, along with relevant policies and regulations, and strengthen the building of underground utility tunnels and the upgrading of old pipelines. These efforts will help make our cities safer and more resilient.

(21) Consolidating and improving the basic rural operation system

We will move forward with well-organized trials to extend rural land contracts by another 30 years upon the expiration of the second-round contracts, deepen the reform to separate the ownership rights, contract rights, and management rights of contracted land, and develop appropriately scaled agricultural operations. We will improve the framework for agricultural operations and refine the pricing mechanism for the transfer of contracted land management rights. We will encourage farmers to engage in cooperative operations and see that our policies for supporting new types of agribusiness serve to increase rural incomes. We will develop a system of convenient and efficient commercial agricultural services. We will develop new types of rural collective economies, establish related operating mechanisms featuring clearly defined property rights and rational income distribution, and ensure that farmers enjoy more adequate property rights and interests.

(22) Improving supporting systems to strengthen agriculture, benefit farmers, and enrich rural areas

Continuing to prioritize agricultural and rural development, we will improve the investment mechanisms for rural revitalization. We will work to expand county industries that benefit local people, build a diversified food supply system, and foster new industries and new forms of business in rural areas. We will optimize the system of agricultural subsidy policies and develop multi-tiered agricultural insurance schemes. We will refine the regular mechanisms for preventing rural residents from lapsing or relapsing into poverty and establish a system of multi-tiered and categorized support for low-income rural residents and underdeveloped areas. We will improve the long-term mechanisms for managing assets formed with government inputs in the process of poverty alleviation. Applying the experience gained from the Green Rural Revival Program in Zhejiang Province, we will refine the long-term mechanisms for promoting all-around rural revitalization.

We will work faster to improve the mechanisms for ensuring the incomes of grain growers and see that the prices of grain and other major agricultural products remain at a reasonable level. We will coordinate efforts to establish an inter-provincial mechanism for major grain-purchasing areas to compensate major grain-producing areas so as to make substantive headway in incentivizing the latter. We will make coordinated progress in reforming the institutions and mechanisms related to the purchase and sale of grain and the management of grain reserves and develop new regulatory models in this regard. The long-term mechanisms for conserving grain and other types of food will be improved.

(23) Deepening reform of the land system

We will reform and refine the system for offsetting cultivated land that has been put to other uses, manage all types of arable land occupation in a unified manner, and improve the acceptance inspection mechanism to make sure that newly-added arable land is of an equivalent quantity and quality. We will improve the mechanisms for developing, verifying, managing, and protecting high-standard cropland. We will refine the management system for ensuring that arable land is used for planting basic crops. We will allow rural households to put houses under their legal ownership to good use by leasing them out, contributing them in the form of shares, and engaging in cooperative ventures. We will promote orderly reforms for market-based transfers of rural collective land designated for business construction and improve the mechanisms for distributing returns realized from the appreciation of land.

We will optimize land management, refining relevant systems so that they are efficiently aligned with macro policies and regional development needs. We will give priority to the reasonable land needs of leading industries and major projects, with a view to creating greater development space for regions with competitive edge. We will establish a coordination mechanism to link increases in urban construction land quotas for cities with the growth of their permanent residents. We will explore mechanisms for using contiguous land that has been reclaimed and upgraded by the government to offset arable land being used by specific projects and regions. We will optimize land use for urban industry and commerce and accelerate the development of the secondary market for construction land. We will promote mixed land development and use and allow for changes in land use purposes when appropriate, ensuring that idle and inefficiently used land can be put to better use. Targeted steps will be taken to address land use problems in various types of industrial parks. Policies will be formulated for extending land use rights for industrial and commercial purposes and for renewing them upon expiration.

VII. Pursuing High-Standard Opening Up

Opening up is a defining feature of Chinese modernization. We must remain committed to the basic state policy of opening to the outside world and continue to promote reform through opening up. Leveraging the strengths of China’s enormous market, we will enhance our capacity for opening up while expanding international cooperation and develop new institutions for a higher-standard open economy.

(24) Steadily expanding institutional opening up

We will promote alignment with high-standard international economic and trade rules and harmonize rules, regulations, management, and standards relating to property rights protection, industrial subsidies, environmental standards, labor protection, government procurement, e-commerce, the financial sector, and other areas, in an effort to create an institutional environment that is transparent, stable, and predictable. We will seize the initiative by opening China’s commodity, services, capital, and labor markets wider to the outside world in an orderly manner and unilaterally opening our doors wider to the world’s least developed countries. We will further reform institutions and mechanisms for foreign aid to realize full-chain management.

We will safeguard the WTO-centered multilateral trading system, actively participate in the reform of global economic governance, and provide more global public goods. We will expand our globally-oriented network of high-standard free trade areas, establish compliance mechanisms that are aligned with prevailing international rules, and optimize the environment for opening up and cooperation.

(25) Deepening the foreign trade structural reform

We will better coordinate trade policies with fiscal, tax, financial, and industrial policies, create a set of systems and policies to support efforts to build China into a strong trading nation, step up reforms to integrate domestic and foreign trade, and actively respond to the trends of digital and green trade. We will develop new regulatory approaches for customs clearance, taxation, and foreign exchange and foster an institutional environment that is conducive to the development of new models and forms of trade. We will develop digital trade in an innovative manner and promote the development of integrated pilot zones for cross-border e-commerce. We will build commodity trading centers and global distribution centers, support various types of entities in developing logistics facilities overseas in a well-ordered way, and facilitate the development of international logistics hubs, as well as hubs for the distribution of commodities and resources, in areas where conditions allow. The mechanisms for preventing and controlling trade risks will be improved, and our export control framework and trade remedy system will be refined.

We will adopt innovative measures to boost trade in services and fully apply the negative list for cross-border trade in services. We will promote comprehensive trials and demonstrations for expanding opening up of the service sector and encourage specialized service organizations to enhance their capacity for providing international services. We will work faster to promote offshore trade and develop new types of transactions in offshore international trade. We will set up sound systems for cross-border financial services and diversify the supply of financial products and services.

(26) Further reforming the management systems for inward and outward investment

We will foster a first-rate business environment that is market-oriented, law-based, and internationalized and protect the rights and interests of foreign investors in accordance with the law. We will expand the catalog of encouraged industries for foreign investment, appropriately shorten the negative list for foreign investment, remove all market access restrictions in the manufacturing sector, and promote wider opening with regard to telecommunications, the internet, education, culture, medical services, and other sectors in a well-conceived way. We will further reform the institutions and mechanisms for promoting foreign investment, ensure national treatment for foreign-funded enterprises in terms of access to factors of production, license application, standards setting, and government procurement, and support them in collaborating with upstream and downstream enterprises in industrial chains. We will improve relevant measures to make it more convenient for people from outside the mainland to live, receive medical services, and make payments on the mainland. We will refine the institutions and mechanisms for promoting and protecting Chinese investment abroad, improve the management and service systems for outward investment, and facilitate international cooperation in industrial and supply chains.

(27) Optimizing the layout for regional opening up

We will consolidate the leading role of eastern coastal areas in our opening up endeavors, promote further opening up in the central, western, and northeastern regions, and move faster toward all-around opening up through links running eastward and westward, across land, and over sea. To leverage the strengths of areas along the coasts, borders, rivers, and major transportation routes, we will optimize the division of functions for opening up among different regions in order to develop a diverse array of pacesetters for opening up. We will implement the strategy for upgrading pilot free trade zones and encourage these zones to engage in pioneering and integrated explorations. The development of the Hainan Free Trade Port will be accelerated.

Harnessing the institutional strengths of the One Country, Two Systems policy, we will work to consolidate and enhance Hong Kong’s status as an international financial, shipping, and trade center, support Hong Kong and Macao in building themselves into international hubs for high-caliber talent, and improve relevant mechanisms to see the two regions playing a greater role in China’s opening to the outside world. We will encourage cooperation between Guangdong, Hong Kong, and Macao in the Greater Bay Area by promoting closer alignment of rules and mechanisms. We will improve relevant institutions and policies to promote economic and cultural exchanges and cooperation across the Taiwan Strait and advance integrated cross-Strait development.

(28) Improving the mechanisms for high-quality cooperation under the Belt and Road Initiative

We will continue to implement the Belt and Road Science, Technology, and Innovation Cooperation Action Plan and redouble efforts to develop multilateral platforms for cooperation in green development, the digital economy, artificial intelligence, energy, taxation, finance, disaster mitigation, and other areas. We will work to improve the integrated framework for land, sea, air, and cyberspace connectivity and build a multidimensional network to connect countries along the Belt and Road. We will make coordinated efforts to advance both major signature projects and “small but beautiful” public welfare projects.

VIII. Advancing Whole-Process People’s Democracy

Developing whole-process people’s democracy is integral to Chinese modernization. We must firmly stay on the path of socialist political advancement with Chinese characteristics and uphold and improve our country’s foundational, basic, and important political systems. We will develop diverse forms of democracy at all levels and ensure that the principle of the people running the country is manifested in concrete and visible ways in all aspects of China’s political and social activities.

(29) Strengthening the institutions through which the people run the country

We must uphold, improve, and implement the system of people’s congresses to good effect. We will improve the systems under which the people’s congresses conduct oversight of the administrative, supervisory, adjudicatory, and procuratorial organs, refine the Law on the Oversight by the Standing Committees of People’s Congresses at All Levels and the mechanisms for its implementation, and strengthen the examination and oversight of government budgets and final accounts by people’s congresses as well as their oversight of state-owned asset and government debt management. We will improve the rules of procedure for people’s congresses and their debate, assessment, discussion, and hearing systems. We will see that deputies to people’s congresses reach out to the public on a greater variety of issues and in more diverse ways and enhance the working mechanisms for drawing on public opinion and pooling the wisdom of the people. The roles of people’s organizations, such as trade unions, Chinese Communist Youth League organizations, and women’s federations, will be brought into play in connecting with and serving the people.

(30) Improving the mechanisms for consultative democracy

We will give play to the role of the Chinese People’s Political Consultative Conference (CPPCC) as a specialized consultative body. We will refine the mechanisms that enable in-depth consultations and interactions, the full expression of opinions, and the formation of broad consensus. We will strengthen the mechanisms through which the CPPCC reports on social conditions and public opinions, stays in contact with the people, and provides them with services. Moves will also be made to refine the mechanisms that facilitate democratic oversight by the CPPCC.

The system of consultative democracy will be improved, with the introduction of more diverse forms of consultation. We will enhance the institutional platforms through which consultations are carried out by political parties, people’s congresses, government departments, CPPCC committees, people’s organizations, communities, and social organizations, and strengthen coordination between the various channels of consultation. We will improve the mechanisms for conducting consultations prior to decision making and during the implementation of decisions. Improvements will also be made to the mechanisms for adopting, implementing, and providing feedback on the consultation outcomes.

(31) Enhancing democracy at the primary level

We will improve the mechanisms for conducting community-level self-governance under the leadership of Party organizations at the primary level. We will refine the institutional and working systems for primary-level democracy and create more channels to allow for the well-ordered participation of various primary-level organizations and local people in the governance of their communities. We will enhance the institutions for keeping the public informed. We will improve the democratic management systems in enterprises and public institutions, which generally take the form of workers’ congresses. In addition, more effective ways will be developed to ensure that enterprise employees can participate in management.

(32) Building a broad united front

We will improve the policies and measures for facilitating the united front’s political role in rallying the support of the people and pooling their strength. We will uphold, develop, and improve China’s new type of political party system. We will see that people from outside the Party can better play their roles and improve the systems for building up the ranks of non-CPC representatives. A law on promoting ethnic solidarity and progress will be formulated, and we will take steps to improve the institutions and mechanisms for forging a strong sense of community for the Chinese nation so as to further strengthen our national cohesion. We will make systematic efforts to ensure that religions in China are Chinese in orientation and establish a more solid legal footing for the governance of religious affairs. We will improve the mechanisms for providing political guidance to non-CPC intellectuals and people from emerging social groups. We will continue working to cultivate a cordial and clean relationship between government and business across the board and improve the working mechanisms for facilitating the healthy development of the non-public sector and those working in it. We will refine the mechanisms for work related to Hong Kong, Macao, Taiwan, and overseas Chinese affairs.

IX. Promoting Socialist Rule of Law with Chinese Characteristics

The rule of law provides an important guarantee for Chinese modernization. We must ensure full implementation of the Constitution and uphold its authority, coordinate the reforms to promote sound legislation, law enforcement, administration of justice, and observance of the law, and improve the mechanisms for ensuring that all are equal before the law, so as to promote socialist rule of law, uphold social fairness and justice, and see that all work of the state is carried out under the rule of law.

(33) Deepening reforms in legislation

The socialist legal system with Chinese characteristics centered on the Constitution will be improved. We will refine the systems for ensuring full implementation of the Constitution and establish a system for reporting on its implementation. We will improve the legislative framework under which Party committees exercise leadership, people’s congresses play a principal role, government departments provide support, and various sectors of society get involved. We will make sure that steps to enact, revise, abolish, interpret, and codify laws are well-coordinated and work to bolster legislation in key, emerging, and foreign-related areas. We will improve both the constitutional review system and the record and review system for normative documents. These efforts will ensure that the quality of legislation further improves. We will explore cross-regional collaboration on legislation. We will improve mechanisms for aligning and coordinating Party rules and regulations with state laws and regulations. A unified national information platform for laws, regulations, and other normative documents will be created.

(34) Advancing law-based government administration

We will keep working to establish a sound legal footing for government institutions, functions, powers, procedures, and responsibilities. We will make government services more standardized, procedure-based, and accessible and improve the integrated national online platform for government services. We will improve the legality review mechanism for major decisions and normative documents and conduct a more thorough review of the legislative work of the government. We will push forward with structural reforms regarding administrative law enforcement, improving institutions and mechanisms for coordinated law enforcement at the community level and for conducting oversight over enforcement. We will refine the system of standards on administrative discretion for matters such as administrative penalties and work to align the administrative law enforcement standards of different regions. Improvements will be made to the system for coordinating administrative and criminal penalties, the institutions and mechanisms for administrative reconsideration, and the administrative adjudication system. We will refine both the vertical management system and the tiered management system at the local level to promote closer coordination and collaboration between institutions under vertical management and local governments. Prudent steps will be taken to optimize the institutions in counties with small populations. We will further reform the management system in development zones. We will improve the structure and layout of public institutions to ensure that they better serve the public interest.

(35) Improving the institutions and mechanisms for impartial law enforcement and administration of justice

We will refine the institutions and mechanisms for ensuring that supervisory organs, public security organs, procuratorates, courts, and administrative departments for justice all fulfill their respective functions and that powers of supervision, investigation, procuratorate, adjudication, and enforcement complement and constrain each other. This will ensure that law enforcement and judicial activities are subject to effective checks and oversight at every link and stage in the process. We will deepen the reforms to separate adjudicatory and enforcement powers, improve the national system for law enforcement, and see that the parties concerned, the procuratorates, and the public exercise oversight throughout the process of enforcement activities. We will improve the system for providing legal remedies and protection during the course of law enforcement and judicial activities as well as the system for granting state compensation. We will increase the transparency of judicial work and improve relevant procedures. We will also enforce and enhance judicial accountability. The establishment of special courts will be regulated. We will further the reforms related to the jurisdiction of administrative cases where jurisdiction is defined by subject matter, exercised in a centralized manner, or established in another region. We will develop institutions and mechanisms for coordinated, efficient policing, advance the reform of staffing management in public security organs at the local level, and continue to reform the management systems in the civil aviation public security organs and the anti-smuggling departments of customs authorities. We will standardize the management of police auxiliaries.

Adhering to the correct outlook on human rights, we will provide more effective human rights protection through law enforcement and administration of justice. We will improve the working mechanisms for ex ante review, ongoing oversight, and ex post redress and refine the system for coercive measures that concern the personal rights of citizens as well as the sealing, sequestering, and freezing of assets. We will investigate and prosecute, in accordance with the law, the abuse of power to bend the law for personal gain, illegal detention, the use of torture to extort confessions, and other similar offences. We will see that lawyer defense is provided in all criminal cases and introduce a system to seal records for minor offences.

(36) Improving the mechanisms for building a law-based society

We will improve the public legal services system covering both urban and rural populations and further reform the systems related to lawyers, notarization, arbitration, mediation, and forensic evidence management. We will adopt more effective methods to raise public awareness of the rule of law and refine the practice-oriented approach to law school education. We will better protect the rights and interests of minors, step up efforts to prevent and control juvenile delinquency, and formulate special regulations on correction and education.

(37) Strengthening the rule of law in foreign-related affairs

We will establish mechanisms for taking a holistic approach to promoting legislation, law enforcement, administration of justice, observance of the law, legal services, and the training of legal professionals for foreign-related affairs. We will improve the system of foreign-related laws and regulations and the systems for enforcing the rule of law and work to deepen international cooperation in law enforcement and administration of justice. We will refine the judicial system that allows the parties in foreign-related civil lawsuits to lawfully enter into jurisdictional agreements and choose applicable extraterritorial laws. We will improve the arbitration and mediation system for international commercial disputes and cultivate world-class arbitration organizations and law firms. We will actively participate in the formulation of international rules.

X. Deepening Reform in the Cultural Sector

Chinese modernization is the modernization of material and cultural-ethical advancement. We must boost our cultural confidence and work to develop advanced socialist culture, promote revolutionary culture, and carry forward fine traditional Chinese culture. We must move faster to stay abreast of new dramatic developments in information technology, cultivate a vast pool of talented personnel in the field of culture, and ignite the cultural creativity of the entire nation.

(38) Improving the responsibility system for ideological work

We will refine the working systems for arming all Party members, educating the people, and guiding our practice with the Party’s new theories. We will improve the system under which the theoretical study groups of Party committees (leading Party members groups) hold regular study sessions, as well as the system for theoretical and political work. We will develop new approaches in the project to study and develop Marxist theory and promote innovation in philosophy and social sciences with a view to building a Chinese intellectual system in this field. We will improve the spokesperson system, develop content production and communication mechanisms as well as assessment systems for all forms of media, and promote a systemic transformation in mainstream media. We will improve the mechanisms for guiding public opinion and coordinating responses to public opinion incidents.

Activities to foster ideals and convictions will be carried out on a regular and institutionalized basis. We will enhance the systems and mechanisms for cultivating and practicing the core socialist values. We will improve and innovate working mechanisms for raising awareness, applying principles, and developing initiatives aimed at promoting cultural-ethical progress. We will launch projects to enhance social etiquette and civility in rural areas. We will refine the mechanisms for publicizing heroes and role models and encouraging people to learn from them and work to develop new mechanisms for promoting patriotism and organizing themed public activities, in an effort to create a social atmosphere in which people look up to heroes, pay tribute to martyrs, and strive to become pioneers. We will establish a system for carrying forward traditional Chinese virtues and improve the institutions and mechanisms for cultivating social morality, work ethics, family values, and personal integrity. We will refine the long-term mechanisms for promoting integrity and credibility and provide public education and guidance so that all members of society readily abide by the law and respect public order and moral standards. We will take firm steps to oppose money worship, hedonism, egocentricity, and historical nihilism. We will develop mechanisms to provide online theoretical and ethical education in a differentiated and targeted manner. We will establish better mechanisms for addressing serious ethical problems in a coordinated way and improve the long-term mechanisms for combating pornography and illegal publications.

(39) Refining the mechanisms for supplying cultural services and products

We will improve the system of public cultural services, establishing mechanisms for channeling quality cultural resources directly to the community level, improving the mechanisms through which nongovernmental actors participate in the supply of public cultural services, and advancing reforms to separate the ownership and use rights for public cultural facilities. In the cultural sector, we will continue with the reform of state capital and SOEs, deepen the internal reform of public institutions on a categorized basis, and improve the mechanisms for developing theater troupes.

We will remain committed to people-centered cultural creation and stay focused on both literary and artistic production and talent cultivation, and on both producing fine works and fostering a favorable environment for creation. On this basis, we will improve the working mechanisms for serving, guiding, and organizing literary and artistic creation and production. We will refine the systems for cultural industries and markets as well as economic policies concerning the development of the cultural sector. We will explore effective mechanisms for integrating culture with science and technology and step up our efforts to foster new forms of cultural business. We will further reform the systems for culture-related government review and approval and record keeping so as to strengthen ongoing and ex post oversight. Comprehensive governance of the cultural and recreational industries will be advanced.

We will establish coordination agencies for preserving and passing down our cultural heritage and put in place an inspection system for cultural heritage protection to facilitate systematic protection and unified supervision. We will institute a system of the defining symbols of Chinese culture and refine institutions and mechanisms for promoting the full integration of culture and tourism. We will improve the public fitness services system and carry out reforms to refine the management systems and operating mechanisms for competitive sports.

(40) Improving the system for comprehensive cyberspace governance

We will deepen reform of the internet management system, combine the functions of online content development and management, and promote integrated management of media communication and online public opinion. We will improve the mechanisms for developing and managing generative artificial intelligence. We will step up the law-based governance of cyberspace, improve the long-term governance mechanisms for the online environment, and refine the system for protecting minors in cyberspace.

(41) Establishing a more effective international communication system

We will move ahead with restructuring China’s international communication framework and deepen the reform and innovation of our mainstream media’s international communication mechanisms in a bid to accelerate the development of a multi-channel and multi-dimensional architecture. We will move faster to develop China’s discourse and narrative systems with a view to making our international communication more effective. Mechanisms for promoting the implementation of the Global Civilization Initiative will be established. We will work to facilitate both outbound and inbound visits to promote broader international people-to-people exchanges and cooperation.

XI. Ensuring and Improving the People’s Wellbeing

Ensuring and enhancing the people’s wellbeing in the course of development is one of the major tasks of Chinese modernization. In line with the principle of doing everything within our means, we will refine the systems of basic public services, with the focus on providing inclusive services, meeting essential needs, and providing a cushion for those most in need. We will strive to resolve the most practical problems that are of the greatest and most direct concern to the people so as to meet people’s aspirations for a better life.

(42) Improving the income distribution system

We will build an institutional framework under which primary distribution, redistribution, and tertiary distribution are well coordinated and mutually complementary. We will work to raise the share of personal income in the distribution of national income and give more weight to work remuneration in primary distribution. We will improve the mechanisms for determining wages, ensuring that they are increased at a reasonable rate and that they are paid in full, and refine the policy system for distribution based on factors of production. We will improve the redistribution mechanisms such as taxation, social security, and transfer payments. We will support the development of public interest activities and charities.

We will keep income distribution and the means of accumulating wealth well-regulated, open more avenues for urban and rural residents to increase their property incomes, and put in place systems to effectively boost the incomes of low-income earners, steadily expand the size of the middle-income group, and properly regulate excessive incomes. We will further reform the salary-setting mechanism for SOEs and rationally determine and strictly regulate the remuneration standards, allowances, and benefits for SOE executives at all levels.

(43) Improving the employment-first policy

We will develop sound mechanisms for promoting high-quality and full employment, refine the related public services system, and work hard to tackle structural unemployment. We will improve the system of employment support for key groups such as college graduates, rural migrant workers, and ex-service members and the system of lifelong vocational skills training. We will coordinate urban and rural employment policies, simultaneously advance service reforms related to household registration, human resources, and personnel records, improve the policy environment to boost employment by encouraging business startups, and support and regulate the development of new forms of employment. We will improve the systems and mechanisms for promoting equality of opportunity and see that the channels for social mobility are unimpeded. We will refine the mechanisms for labor relation consultations and mediation and do more to safeguard workers’ rights and interests.

(44) Improving the social security system

We will improve the system for unified national management of basic old-age insurance funds and the unified national platform for social insurance public services. We will develop sound systems for ensuring that social security funds are kept safe through supervision and their value is maintained and increased over time. We will refine the mechanisms for financing basic old-age insurance and basic medical insurance and for adjusting the benefits of both as appropriate. Basic pension benefits for rural and non-working urban residents under the basic old-age insurance scheme will be raised gradually. We will build a sound social security system to serve people in flexible employment, rural migrant workers, and those in new forms of employment and expand the coverage of unemployment insurance, workers’ compensation, and childbirth insurance programs. We will see to it that all restrictions preventing people from accessing social security in the places where they work but do not hold permanent residency are lifted and that policies for transferring social security accounts are improved. We will move faster to develop a multi-tiered, multi-pillar old-age insurance system, expand the coverage of the annuity system, and promote the implementation of private pension schemes. We will leverage various commercial insurance schemes as a supplementary support. We will work toward provincial-level unified management of basic medical insurance funds, further reform medical insurance payment models, improve major disease insurance and medical assistance schemes, and tighten oversight over medical insurance funds. We will improve the social assistance system, the system for protecting the lawful rights and interests of women and children, and the social security and service systems for people with disabilities.

We will move faster to establish a housing system that supports both housing rentals and purchases and foster a new development model for the real estate sector. We will scale up the building and supply of government-subsidized housing to meet the essential need of salaried people for a home to live in. We will also work to support the diverse needs of urban and rural residents for better housing. Municipal governments will be given greater decision-making powers to regulate the real estate market, and based on local conditions, some cities will be permitted to abolish or reduce restrictions on housing purchases and to scrap relevant standards for ordinary and non-ordinary housing. We will carry out reforms to change the way real estate development is financed and to improve the advance purchase system for commodity housing. Improvements will also be made to the taxation system in the real estate sector.

(45) Further reforming the medical and healthcare systems

We will implement a health-first strategy. We will improve the public health system, promoting public participation as well as collaboration and integration between hospitals and disease prevention and control institutions and boosting capacities for disease monitoring and early warning, risk assessment, epidemiological investigation, testing and inspection, emergency response, and medical treatment. We will support coordinated development and governance of medical services, medical insurance, and pharmaceuticals. We will do more to increase the availability of quality medical resources and see that such resources are channeled toward the community level and more evenly distributed among regions. We will move faster to develop the tiered diagnosis and treatment system, propel the development of tightly knit medical consortia, and upgrade the services of community-level medical and healthcare institutions. We will deepen the reform of public hospitals to see that they better serve the public interest, establish mechanisms whereby medical expenses are primarily based on medical services, improve the remuneration system, and set up a mechanism for making dynamic staffing adjustments. We will guide and better regulate the development of private hospitals and introduce new approaches in the supervision of medical and healthcare services. We will improve the mechanisms for supporting the development of innovative drugs and medical equipment and for promoting the preservation and innovative development of traditional Chinese medicine.

(46) Improving the systems for supporting population development and providing related services

We will improve the population development strategy in response to population aging and the declining birth rate. A sound system will be instituted to provide full life-cycle population services to all in order to promote high-quality population development. We will refine the policy system and incentive mechanisms for boosting the birth rate and strive to build a childbirth-friendly society. We will work to bring down the costs of childbirth, parenting, and education, refine parental leave policies, introduce a system of childbirth subsidies, improve basic public services for childbirth and pediatric medical care, and further raise the childcare-related deduction for personal income tax. We will make greater efforts to develop a public-benefit childcare service system and provide support for employer-run nurseries, community childcare facilities, and home-based childcare. Based on the general patterns underlying population flows, we will see that public services follow the movement of populations and facilitate the reasonable concentration of people in and their orderly flow between urban and rural areas and different regions.

To actively respond to population aging, we will refine the policies and mechanisms for developing elderly care programs and industries. We will develop the silver economy and support the creation of diverse jobs tailored to elderly people. In line with the principle of voluntary participation with appropriate flexibility, we will advance reform to gradually raise the statutory retirement age in a prudent and orderly manner. To boost the supply of basic elderly care services, we will develop community-based facilities, improve the operation mechanisms for public-run institutions, encourage and guide the participation of enterprises and other non-governmental actors in service provision, and promote mutual-aid elderly care and the integration of medical care and elderly care. We will work faster to shore up weaknesses in rural elderly care services. We will also see to it that better services are provided for elderly people with special difficulties including those who live alone, have disabilities, or suffer from physical impairment, and accelerate the introduction of insurance schemes for long-term care.

XII. Deepening Reform in Ecological Conservation

Chinese modernization is the modernization of harmony between humanity and nature. We must work to improve ecological conservation systems and make concerted efforts to cut carbon emissions, reduce pollution, pursue green development, and boost economic growth. We must actively respond to climate change and move faster to improve the institutions and mechanisms for applying the principle that lucid waters and lush mountains are invaluable assets.

(47) Improving the basic systems for ecological conservation

We will implement region-specific environmental management systems featuring differentiated, targeted regulation and improve the systems for environmental monitoring and assessment. We will establish sound, united, well-aligned systems for regulating the use of territorial space of all types across the country and for approving territorial space plans. To improve the property rights and management systems for natural resource assets, we will refine the mechanism for the delegation of ownership over public-owned natural resource assets and establish systems for assessing and supervising performance in terms of protecting the environment, protecting and utilizing natural resources, and ensuring that natural resource assets hold their value and appreciate. We will improve the coordination mechanism for ensuring national ecological security. An environmental code will be compiled.

(48) Improving environmental governance systems

We will develop responsibility, oversight, and market systems as well as laws, regulations, and policies to improve environmental governance. We will refine the institutions and mechanisms for ensuring that pollution control practices are targeted, grounded in science, and law-based, and implement an oversight system for stationary pollution sources centered on emissions permits. We will establish systems for the coordinated treatment of new pollutants and management of environmental risks and make a coordinated push to reduce the discharge of various pollutants. The reform to advance the law-based disclosure of environmental information will continue, and an environmental credibility oversight system will be put into place. We will develop systems for integrated upstream-downstream environmental governance in major river basins. Comprehensive efforts will be made to develop the national park-based system of protected areas.

We will implement the management system for ecological conservation redlines, improve the mechanisms for integrated protection and systematic governance of mountain, water, forest, farmland, grassland, and desert ecosystems, and develop multiple funding mechanisms for ecosystem protection and restoration. We will enforce the system of mandatory limits on the use of water resources and replace the water resource fee with a tax nationwide. The coordination mechanism for biodiversity protection will be enhanced, and the systems for developing and protecting marine resources will be improved. We will refine the mechanisms for realizing the market value of ecosystem goods and services. We will further reform the system of paid use for natural resources. We will advance comprehensive compensation for ecological conservation, improve the trans-regional compensation mechanism for ecological conservation, and take coordinated steps to promote compensation for environmental damage.

(49) Improving the mechanisms for green and low-carbon development

We will implement fiscal, tax, financial, investment, and pricing policies as well as standards to support green and low-carbon development, develop green and low-carbon industries, improve incentive mechanisms for eco-friendly consumer spending, and work toward an economy that facilitates green, low-carbon, and circular development. We will optimize policies on green government procurement and refine the green taxation system. We will improve the systems for total resource consumption control and comprehensive resource conservation, as well as the system for recycling waste and used materials. Mechanisms for ensuring clean and efficient use of coal will be refined. We will accelerate the planning and development of a new type of energy system and improve the policies and measures for promoting the absorption of electricity generated from new energy sources into power grids and for the regulation of such energy. Improvements will be made to the working systems for adapting to climate change. New mechanisms will be put in place to facilitate the transition from controlling the total amount and intensity of energy consumption to controlling the total amount and intensity of carbon emissions. We will establish a carbon emissions statistics and accounting system, a carbon labeling and certification system, as well as a carbon footprint management system. We will also improve the cap-and-trade system for carbon emissions and the trading system for voluntary greenhouse gas emissions reduction. On this basis, we will actively and prudently move toward reaching peak carbon emissions and carbon neutrality.

XIII. Modernizing China’s National Security System and Capacity

National security provides a pivotal foundation for ensuring steady and sustained progress in Chinese modernization. We must fully apply a holistic approach to national security, improve the institutions and mechanisms for safeguarding national security, and ensure that high-quality development and greater security reinforce each other, so as to safeguard the country’s long-term stability and security.

(50) Improving the national security system

The mechanisms for coordinating national security work will be strengthened. We will improve the legal, strategy, policy, and risk monitoring and early warning systems for national security, the systems for safeguarding security in key sectors, and the coordination and command systems for major projects. We will create a coordinated and highly effective system for protecting national security and better leverage science and technology to safeguard national security.

(51) Improving the public security governance mechanisms

We will improve the response and support system for major public emergencies, refine the emergency response command mechanisms under the overall safety and emergency response framework, bolster response infrastructure and capabilities in local communities, and strengthen capacity for disaster prevention, mitigation, and relief. The mechanisms for identifying and addressing workplace safety risks and for conducting retroactive investigations to determine liability will be improved. We will refine the food and drug safety responsibility system, as well as the systems of monitoring, early warning, and risk prevention and control for biosafety and biosecurity. We will strengthen the cybersecurity system and institute oversight systems to ensure the safety of artificial intelligence.

(52) Improving the social governance system

We will apply and further develop the Fengqiao model for promoting community-level governance in the new era, enhance the Party organization-led urban and rural community governance system based on self-governance, the rule of law, and the rule of virtue, and improve the social governance system based on collaboration, participation, and benefit sharing. We will explore avenues for establishing a unified national population management system. We will improve the institutions and mechanisms for social work, better guide community-level governance through Party building, strengthen the ranks of social workers, and advance the development of the volunteer service system. We will promote law-based handling of public complaints and proposals. To improve the social governance capacity of cities, steps will be taken to ensure that citizen hotlines and other public service platforms function more effectively. To advance one-stop government services, we will improve the list-based management mechanism for relevant major tasks as well as the mechanism for ensuring ongoing progress. We will improve the system for public psychological and counseling services and crisis intervention mechanisms. We will refine the mechanisms for giving full play to the role of family ties, values, and traditions in community-level social governance. Reform of trade associations and chambers of commerce will be furthered. Improvements will be made to the management system for social organizations.

We will enhance the systems for ensuring that the powers and resources of towns and townships (urban sub-districts) are commensurate with their duties, so that they are better able to provide services and conduct management. We will improve the integrated system for maintaining law and order and the mechanism for combating and rooting out organized crime on an ongoing basis, and we will, in accordance with the law, crack down hard on illegal and criminal activities that cause grave public concern.

(53) Improving the mechanisms for ensuring national security in foreign-related affairs

We will establish sound coordination mechanisms for promoting security in neighboring regions. We will strengthen the institutions and mechanisms for early warning, prevention and control, and protection against risks to China’s interests and investments overseas and deepen international law enforcement cooperation in the realm of security, so as to protect the lawful rights and interests of Chinese citizens and legal entities overseas. Mechanisms for countering foreign sanctions, interference, and long-arm jurisdiction will be strengthened. We will enhance the mechanisms for safeguarding China’s maritime rights and interests, as well as those for China’s participation in global security governance.

XIV. Deepening National Defense and Military Reform

National defense and military modernization is an integral part of Chinese modernization. We must maintain the Party’s absolute leadership over the people’s armed forces and fully implement the strategy of strengthening the military through reform, in order to provide a strong guarantee for realizing the centenary goal of the People’s Liberation Army in 2027 and basically modernizing national defense and the armed forces.

(54) Improving the institutions and mechanisms for leading and managing the people’s armed forces

We will improve the institutions and mechanisms for implementing the system of ultimate responsibility resting with the chairman of the Central Military Commission (CMC) and continue to enhance political loyalty in the military. We will optimize the functional setup of CMC departments and improve the mechanisms for coordinated advancement of military operations, capacity building, and combat preparedness. We will refine the consultation and evaluation mechanisms for major decisions, develop new approaches to strategic management, and improve the military governance system. We will improve the working mechanisms for running the military in accordance with the law. We will refine the supporting policies and systems for military operations, combat preparedness, military human resources, and other fields. The reform of military academies will be deepened in a bid to fully harness their potential. Military-affiliated enterprises and public institutions will also undergo adjustment and reform.

(55) Deepening reform of joint operations systems

We will refine the functions of the CMC command center for joint operations, enhance its command functions in major security fields, and establish mechanisms for facilitating its coordination with central Party and state departments. We will optimize the composition of the command centers for joint theater operations and improve the configuration of commands for joint taskforce operations. We will better coordinate the development and application of the network information system. To develop a new framework of services and arms, we will speed up the development of strategic deterrence forces and strive to develop new-domain forces with new combat capabilities, while making coordinated efforts to strengthen traditional combat forces. The composition of the armed police force will be improved.

(56) Deepening military-civilian reforms

We will improve the working mechanisms for developing integrated national strategies and strategic capabilities and refine the institutions and mechanisms for military-related decision-making, deliberation, and coordination. We will improve the mechanisms for submitting and reporting on defense-related military needs and enhancing military-civilian alignment and refine the national defense mobilization system. Reform of the defense-related science, technology, and industry systems will be deepened to upgrade the layout of these areas. We will refine the system for weaponry and equipment procurement, develop reward mechanisms for designing military products, and modernize our weaponry and equipment management system. We will improve the mechanisms for coordinating standards between the military and civilian sectors. We will better coordinate development and management in aerospace, military trade, and other fields. We will optimize the institutions and mechanisms for leading and managing border and coastal defense and improve mechanisms to enable the Party, the government, the military, the police force, and the people to work together on border governance. Reform of the militia system will be furthered. The mechanisms for strengthening mutual support between civilian sectors and the military will be refined.

XV. Improving the Party’s Leadership

Leadership by the Party provides a fundamental guarantee for further deepening reform comprehensively to advance Chinese modernization. We must acquire a deep understanding of the decisive significance of establishing Comrade Xi Jinping’s core position on the Party Central Committee and in the Party as a whole and establishing the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. We must be more conscious of the need to maintain political integrity, think in big-picture terms, follow the leadership core, and keep in alignment with the central Party leadership. We must stay confident in the path, theory, system, and culture of socialism with Chinese characteristics. We must uphold Comrade Xi Jinping’s core position on the Party Central Committee and in the Party as a whole and uphold the Central Committee’s authority and its centralized, unified leadership.

We must maintain a keen awareness of the need to use the Party’s self-reform to steer social reform and continue to apply both the spirit of reform and rigorous standards in conducting Party self-governance. We will improve the systems and regulations for the Party’s self-reform and continue working to purify, improve, renew, and excel ourselves. All this will enable our Party to remain the strong leadership core in building socialism with Chinese characteristics.

(57) Upholding the Party Central Committee’s centralized, unified leadership over the endeavor to further deepen reform comprehensively

The Party Central Committee exercises leadership over the general design, coordination, and overall advancement of all our reforms. We will refine the mechanisms through which the major decisions and plans of the Central Committee are implemented, in order to ensure full compliance with its orders and prohibitions. Party committees (leading Party members groups) at all levels are responsible for implementing the Central Committee’s decisions and plans, planning and advancing reforms in their regions and departments, encouraging pioneering efforts and innovations based on their own situations, and creating new experience that can be applied elsewhere. Continuing to follow the Party’s mass line in the new era, we will fully incorporate social expectations, the people’s wisdom, the views of experts, and primary-level experience into the design of reforms. We will set reform agendas with a focus on solving prominent problems and improve the mechanisms for drawing up key reform plans. We will uphold truth, correct errors, and discover problems and remedy failings as they arise. We will improve reform incentives and better guide public opinion so as to foster a favorable environment for reform.

(58) Deepening institutional reforms related to Party building

With a focus on boosting the whole Party’s drive, initiative, and creativity for reform and development, we will improve the systems and mechanisms for Party building. We will further arm ourselves with the Party’s new theories and set up sound long-term mechanisms for reinforcing commitment, acquiring knowledge, improving conduct, and enhancing performance through learning. We will further reform the management system for officials and personnel and firmly follow the right approach to selecting and appointing officials. Officials who are politically committed, highly responsible, determined to pursue reform, outstanding in performance, and honest and clean, must be selected; and the problem of officials acting arbitrarily or lacking the willingness, courage, or ability to deliver must be addressed. We will see that officials have a correct understanding of what it means to perform well and improve the mechanisms for effectively preventing and correcting any misguided views about achievements. We will apply the “three distinctions”([2]) to encourage officials to forge ahead in a pioneering spirit and demonstrate enterprise in their work. We will make an ongoing effort to ensure that officials can be demoted as well as promoted and make a stronger push to replace those who are no longer suitable for their posts. We will improve the mechanisms for providing regular training, and basic training in particular, for officials, give them more professional training opportunities, and temper them through practice, in order to make them fully capable of advancing modernization initiatives. The tenure system for leading officials will be refined and fully applied, and the handover system for the heads of leadership teams will be improved. We will strengthen the political and organizational functions of Party organizations. We will look into effective ways of Party building in new types of economic and social organizations and among groups in new forms of employment. We will improve the mechanisms for guiding and managing Party members and giving full play to their roles. We will also refine Party rules and regulations, increase their authority, and fully enforce them.

(59) Intensifying efforts to improve conduct, build integrity, and combat corruption

Mechanisms for conducting concrete, targeted, and regular political oversight will be improved. We will steadfastly implement the central Party leadership’s eight-point decision on improving conduct and refine our systems and mechanisms for preventing and tackling pointless formalities and bureaucratism. We will continue to streamline and standardize meetings and documents, as well as all types of demonstration initiatives, evaluations, standards inspections, festival celebrations, expositions and exhibitions, and forums; strictly control the total number of community-level inspections, examinations, and evaluations; and raise the quality of research and studies. Great effort will be made to address the excessive frequency of all these activities. We will formulate lists of duties for towns and townships (urban sub-districts) and refine the long-term mechanisms for reducing their burdens. We will set up mechanisms for carrying out regular and intensive education on Party discipline and better exercise four forms of oversight over discipline compliance,([3]) thus ensuring we make full use of Party discipline as a guide, restraint, guarantee, and incentive.

We will improve the mechanisms for coordinating efforts to ensure that officials do not have the audacity, opportunity, or desire to be corrupt and work hard to eradicate the breeding grounds and conditions for corruption. We will improve the mechanisms for investigating and addressing instances of both misconduct and corruption, intensify efforts to uproot corruption in sectors with a high concentration of power, funds, and resources, and strictly investigate and deal with any collusion between government officials and businesspeople that undermines the political ecosystem and economic development. We will refine the mechanisms for taking joint punitive actions against major bribe givers and adopt more measures to effectively prevent and control new and disguised forms of corruption. We will take stronger steps to handle false accusations. We will improve the mechanisms for pursuing fugitives, preventing escape, and retrieving stolen assets. We will see that a culture of integrity prevails in the new era.

Party and state oversight systems will be improved. We will ensure that principal and oversight responsibilities for full and rigorous Party self-governance are assumed. We will improve the supporting systems for more effective oversight of leadership teams and their heads. We will improve the mechanisms for applying checks over the allocation and exercise of power and oppose privilege-seeking mindsets and behavior. We will work to coordinate discipline and law enforcement with the administration of criminal justice. We will improve the working institutions and mechanisms for discipline inspection. We will optimize the functions of oversight, inspection, review, and investigation agencies, improve the discipline inspection and supervision systems for departments under vertical management, and work to see that discipline inspection and supervision teams are dispatched to all central government-administered enterprises. Institutional reforms for primary-level oversight will be deepened. Steps will be taken to advance national anti-corruption legislation, revise the Supervision Law, and formulate a law on countering transnational corruption.

(60) Ensuring the implementation of reforms with relentless perseverance

The whole Party must take pragmatic, resolute, and effective steps to ensure implementation of the Party Central Committee’s decisions and plans on further deepening reform comprehensively. We need to work in concert from top to bottom across all departments and regions to set the tasks, timelines, and priorities for reform in a well-conceived way, and designate competent departments for implementing each reform initiative and clearly define their responsibilities. The implementation of major reforms will be subject to oversight and inspection, and the litmus test of reform will lie in how well it performs, what it delivers, and how much satisfaction it brings our people.

Chinese modernization is the modernization of peaceful development. In diplomatic work, China remains firm in pursuing an independent foreign policy of peace and is dedicated to promoting a human community with a shared future. We will stay committed to the common values of all humanity, pursue the Global Development Initiative, the Global Security Initiative, and the Global Civilization Initiative, and call for an equal and orderly multipolar world and universally beneficial and inclusive economic globalization. We will deepen institutional reforms related to the work of foreign affairs and get involved in leading the reform and development of the global governance system. We will resolutely safeguard China’s sovereignty, security, and development interests and foster a favorable external environment for further deepening reform comprehensively to advance Chinese modernization.

Let the whole Party, the entire military, and Chinese people of all ethnic groups rally more closely around the Party Central Committee with Comrade Xi Jinping at its core. Let us hold high the banner of reform and opening up, pool all wisdom and strength, and forge ahead with enterprise. Let us work hard toward the Second Centenary Goal of building China into a great modern socialist country in all respects and strive to advance the rejuvenation of the Chinese nation on all fronts through Chinese modernization.

([1]) The Five-Sphere Integrated Plan is to promote coordinated economic, political, cultural, social, and ecological advancement. The Four-Pronged Comprehensive Strategy is to make comprehensive moves to build a modern socialist country, deepen reform, advance law-based governance, and strengthen Party self-governance.

([2]) The three distinctions refer to those between errors caused by lack of experience in pilot reforms and deliberate violations of discipline and law; between errors made in conducting experiments that are not explicitly restricted by higher-level authorities and arbitrary violations of discipline and law in the face of higher-level authorities’ explicit prohibition; and between unwitting errors made in pursuing development and violations of discipline and law for personal gain.

([3]) The four forms are: 1) criticism and self-criticism activities and oral and written inquiries, which are to be conducted regularly to ensure that those who have committed minor misconduct are made to “redden and sweat”; 2) light penalties and minor organizational adjustments to official positions, which are to be applied in the majority of cases; 3) heavy penalties and major adjustments to official positions, which are to be applied in a small number of cases; and 4) investigation and prosecution, which are to be undertaken in a very small number of cases involving serious violations of discipline and suspected criminal activity.

The 20th Central Committee of the Communist Party of China (CPC) starts its third plenary session in Beijing on Monday morning. Keen observers of China might remember that on March 12 this year, Xinhua News Agency issued an article titled "Profile: Xi Jinping the reformer," describing Xi as "another outstanding reformer in the country after Deng Xiaoping."

Today, aligning with the start of the third plenary session, Xinhua released both an updated version of this article via its wire service to subscribers, and for the first time, a Chinese version. This revision reaffirms Xi’s status as "another outstanding reformer in the country after Deng Xiaoping" and incorporates additional insights pertinent to the themes of the third plenary session.

Due to the extensive length of the original article, I have selected some key highlights from the updated English version for the first part of today’s newsletter. The complete text in English can be found in the second part, and the full Chinese version is presented in the third part. Please note that the selections reflect my personal perspective and not necessarily that of Xinhua.

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Highlights:

• The ongoing session is considered on par with other reform-themed "third plenums," including the one in 1978 when Deng Xiaoping kick-started China's reform and opening-up drive.

• In the run-up to the current plenum, Xi has been busy promoting reform, urging efforts to "emancipate the mind, liberate and develop social productive forces, and unleash and enhance social vitality," so as to "provide strong impetus and institutional guarantees for Chinese modernization." This has raised expectations for a new round of profound reforms, dispelling concerns about whether China's reform is "stagnating," or whether the Chinese economy is "losing steam."

• Nevertheless, faced with a myriad of old and new challenges, China is now in a critical period for accelerating its reform pace.

• Xi is regarded as another outstanding reformer in the country after Deng Xiaoping. The two leaders faced the same mission -- to modernize China, but against strikingly different backdrops ... Yet extra effort is required as China now faces people's ever-growing needs for a better life, and is confronted with major challenges such as downward economic pressure following the COVID-19 pandemic and risks associated with the real estate sector, local government debts, and some small and medium-sized financial institutions.

• Seeking a better future for the country and its people, Xi highlighted reform and opening-up as "an important means" to realize Chinese modernization and extend the country's development miracle.

• Xi's commitment to reform has been consistent all along. In 1969, when he was not even 16, Xi was sent to Liangjiahe village in northwest China's Shaanxi Province to do farm labor. There, he experienced hunger. The young man's aspiration at that time was to ensure that all fellow villagers could have enough to eat.

• Xi's commitment to reform was influenced by his father, Xi Zhongxun, an old revolutionary as well as a champion of reform and opening-up. In 1978, the senior Xi was appointed as a major official of south China's Guangdong Province. He helped build up the country's first special economic zones including Shenzhen, Zhuhai and Shantou.

• In 2014, during an inspection tour of SAIC Motor, a major Chinese carmaker, Xi emphasized the significance of developing products that cater to diverse needs and highlighted the importance of new energy vehicles in strengthening China's position in the automotive sector. In the following decade, Xi became a big fan of electric cars, visiting automotive companies, touring laboratories, and showing great interest in trying new home-developed models. He encouraged carmakers to focus on product quality and cultivate market competitiveness. The new energy industry is, in fact, part of Xi's vision of "new quality productive forces." This new phrase first mentioned by Xi during last year's local inspections has quickly become a buzzword for the Chinese economy, but Xi had started relevant practice since a much earlier date. Back in the 1970s in the Liangjiahe village of Shaanxi, Xi became the first person across the province to introduce the use of biogas-generating facilities, which could be categorized as "new quality productive forces" at that time, to give fellow villagers a clean replacement of firewood and kerosene used for cooking and lighting.

• He likened China's lack of strong innovation capability to the Achilles' heel of an economic giant. "Only reformers can advance, only innovators can thrive, and only those who reform and innovate will prevail," he said.

• Carrying on Deng's legacy and with a strong sense of responsibility, Xi is leading China on a path of modernization that not only creates economic miracles and development opportunities, but also explores a new form of human civilization. "Our modernization is both the most challenging and the greatest," said Xi. "This is an unprecedented path, but we will continue to explore it and forge ahead with courage."

Profile: Xi Jinping the reformer

BEIJING, July 15 (Xinhua) -- China's leader Xi Jinping is rolling out a set of new reforms that will determine the growth trajectory of the world's second-largest economy, as the Communist Party of China (CPC) leadership started a four-day policy meeting in Beijing on Monday morning. At the opening of the Third Plenary Session of the 20th CPC Central Committee, Xi, as the general secretary of the Committee, delivered a work report on behalf of the Political Bureau and expounded on a draft decision on further comprehensively deepening reform and advancing Chinese modernization.

The ongoing session is considered on par with other reform-themed "third plenums," including the one in 1978 when Deng Xiaoping kick-started China's reform and opening-up drive.

In the run-up to the current plenum, Xi has been busy promoting reform, urging efforts to "emancipate the mind, liberate and develop social productive forces, and unleash and enhance social vitality," so as to "provide strong impetus and institutional guarantees for Chinese modernization."

This has raised expectations for a new round of profound reforms, dispelling concerns about whether China's reform is "stagnating," or whether the Chinese economy is "losing steam."

Since Xi assumed the top office more than a decade ago, China has entered a "new era." The country's economic strength has grown, and its international prestige has continued to rise. Reform is the hallmark of this era.

Nevertheless, faced with a myriad of old and new challenges, China is now in a critical period for accelerating its reform pace.

REFORM WILL NOT STOP, OPENING-UP WILL NOT CEASE

Xi is regarded as another outstanding reformer in the country after Deng Xiaoping.

The two leaders faced the same mission -- to modernize China, but against strikingly different backdrops.

When Deng launched reform and opening-up in the late 1970s, China's per-capita GDP was less than 200 U.S. dollars. His cause of reform and opening-up started almost from scratch.

In 2012, when Xi was elected general secretary of the CPC Central Committee, China had become the world's second-largest economy, with a per-capita GDP of over 6,000 dollars. But growth was shifting gears and many advantages, including low labor costs, had started to diminish.

Instead of resting on the laurels of his predecessors, Xi was committed to carrying on reform, though he knew how hard it would be.

"The easy part of the job has been done to the satisfaction of all. What is left are tough bones that are hard to chew," he said.

Over the past decade, more than 2,000 reform measures have been rolled out, enabling the country to eliminate extreme poverty, promote integrated urban-rural development, fight corruption, support businesses, boost innovation, and push forward a "green revolution."

Owing to these reform measures, the Chinese economy has not only sustained robust growth but also more than doubled since 2012, cementing the country's global status as a major growth contributor.

Yet extra effort is required as China now faces people's ever-growing needs for a better life, and is confronted with major challenges such as downward economic pressure following the COVID-19 pandemic and risks associated with the real estate sector, local government debts, and some small and medium-sized financial institutions.

Seeking a better future for the country and its people, Xi highlighted reform and opening-up as "an important means" to realize Chinese modernization and extend the country's development miracle.

He reiterated the significance of reform at a group study session of the Political Bureau of the CPC Central Committee in January. Weeks later, at the annual sessions of the nation's top legislature and political advisory body, he stressed the need to deepen reform in various sectors.

"Reform is the driving force for development," Xi said in May when he inspected east China's Shandong Province. During that trip, he also convened a symposium to seek opinions from business leaders and scholars on how to further deepen reform.

"It's quite clear that reform holds a significant weight in Xi's mind, and I think he has a good understanding of all reform-related issues," said Huang Hanquan, head of the Chinese Academy of Macroeconomic Research who attended the symposium as a guest speaker.

Earlier, Xi had told members of the U.S. business, strategic and academic communities who visited Beijing this spring that China was planning and implementing "a series of major steps to comprehensively deepen reform." China will steadily foster a market-oriented, law-based and internationalized business environment, Xi said, adding that this will create broader development space for U.S. and other foreign businesses.

Xi's commitment to reform has been consistent all along.

In 1969, when he was not even 16, Xi was sent to Liangjiahe village in northwest China's Shaanxi Province to do farm labor. There, he experienced hunger. The young man's aspiration at that time was to ensure that all fellow villagers could have enough to eat.

Xi's strong advocacy for reform also stems from the people's aspirations for a better life. The reform measures he introduced as the Party chief of Liangjiahe, which included the use of biogas and the opening of a blacksmith shop and a grocery store, all aimed at improving the villagers' lives.

Xi's commitment to reform was influenced by his father, Xi Zhongxun, an old revolutionary as well as a champion of reform and opening-up. In 1978, the senior Xi was appointed as a major official of south China's Guangdong Province. He helped build up the country's first special economic zones including Shenzhen, Zhuhai and Shantou.

Also in 1978, Xi Zhongxun entrusted the junior Xi, who was then studying at the prestigious Tsinghua University, to conduct a field study on the household contract responsibility system initiated in east China's Anhui Province. The younger Xi took a lot of notes that filled an entire notebook, and he has kept that notebook to this day.

Xi's reputation as a reformer was reinforced as his political career advanced.

In the early 1980s, he initiated reform experiments in the impoverished county of Zhengding, Hebei Province, commencing with the rural land contract system trial -- the first of its kind throughout the northern province.

An article published in the China Youth magazine in 1985 described the county's transformation in detail. It cited a county Party secretary from a neighboring province who paid a visit to Zhengding as saying: "Here, you don't hear people chanting 'reform,' but reform is happening everywhere."

"Looking back at those years, one of the things we achieved was liberating our thinking," said Xi while reflecting on the reforms he led in Zhengding.

After Zhengding, Xi was assigned to work in Xiamen, a special economic zone in Fujian Province, where he spearheaded the establishment of China's first joint-venture bank -- Xiamen International Bank. After ascending to the position of governor of Fujian, Xi led reforms in collective forest tenure, which were later introduced to other parts of the country. This initiative has been reputed as another revolutionary step in China's rural reforms after the household contract responsibility system.

During his tenure as the Party chief of east China's Zhejiang Province, Xi proposed an initiative to promote development through industrial upgrading. He actively supported private businesses, and encouraged businesspeople to "come directly" to his office to seek help. He also brought reforms in Zhejiang far beyond the economic and political spheres, to cover the cultural, social and ecological aspects.

Xi's name as a reformer appealed to some prominent international figures. In September 2006, Henry Paulson, then U.S. treasury secretary, visited China and chose Hangzhou, capital city of Zhejiang, as his first stop. He regarded Xi as the "perfect choice" for his initial meeting in China, describing the latter as "the kind of guy who knows how to get things over the goal line."

Paulson later recounted that during another meeting with Xi in 2014, the Chinese leader stated, "My concern is mainly reform and related issues."

In 2007, as Shanghai's Party chief, Xi foresaw the need for reforms to transition the city's economy to innovation-driven development, enhance its competitiveness as an international financial center, and reinforce its role as a leader in the country's reform and opening-up.

After assuming the Party's top post in 2012, Xi's first domestic inspection took him to Shenzhen, following in his father's footsteps. There, he laid a flower basket at the bronze statue of Deng Xiaoping in Lianhuashan Park, declaring a firm commitment to reform: "Reform will not stop, and opening-up will not cease!"

The Third Plenary Session of the 18th CPC Central Committee, convened in 2013 under Xi's leadership, is heralded as a milestone, much like the Third Plenary Session of the 11th CPC Central Committee in 1978 that ushered in the era of reform. The 2013 event marked the dawn of a new era of reform.

During this session, Xi listed a series of challenges for China's further development, including corruption, unsustainable development and environmental issues. He stressed that "the key to addressing these problems lies in deepening reform."

The session approved a decision on "some major issues concerning comprehensively deepening the reform." A Spanish newspaper commented that Xi had initiated the most profound economic, social and administrative reforms in China in over 30 years.

More than a month later, China announced the decision to establish the Central Leading Group for Comprehensively Deepening Reform, which Xi personally headed. This marked the first time in the Party's history that a leadership body exclusively dedicated to reform was established at the central level. Later, this group evolved into the Central Commission for Comprehensively Deepening Reform, still with Xi as its director.

"On difficult and important reforms, Xi made the final decisions," said a person close to the decision-making process. The official also disclosed that Xi meticulously reviewed each draft of major reform plans, making edits word by word.

VENTURING INTO THE MOUNTAIN DESPITE KNOWING THERE ARE TIGERS

The reforms led by Xi have been based on thoughtful considerations derived from his many years of practice, with a whole set of top-level designs.

He has invoked the ancient Chinese idiom of "discarding the outdated in favor of the new" to call for action, believing that reform and innovation are inherent cultural genes of the Chinese nation.

Xi has been clear-headed regarding the direction of reform. He has cautioned against copying the political systems of other countries, once saying that reform denying socialist orientation would only lead to a "dead end."

"What cannot be changed must be resolutely kept unchanged," he stated, stressing the necessity to uphold the Party's overall leadership in advancing reforms.

For what needs to be changed, Xi has demanded firm actions, urging the creation of conditions for reform even when they do not yet exist. The must-do tasks included eliminating all drawbacks that restrict the vitality of business entities and hinder the full play of the market.

With unprecedented scope, scale and intensity, Xi's reforms have covered the fields of economy, politics, culture, society, ecology, Party building, national defense and the military, among others.

He has developed a methodology for reform in the new era, which stresses properly handling the relationships between emancipating the mind and seeking truth from facts, between advancing as a whole and making breakthroughs in key areas, between top-level design and "crossing the river by feeling the stones," between being bold and maintaining a steady pace, as well as balancing reform, development and stability.

He has stressed pursuing reform in a systematic, holistic and coordinated way and respecting the pioneering spirit of the people. Officials have also been told to "establish the new before abolishing the old" and ensure proper timing and intensity of reform to good effect.

"He corrected the mentality of measuring the success of development simply by GDP growth and enabled the reform to truly touch the vested interests of some people," said an official from Shaanxi.

He recalled that Xi demanded multiple inquiries to stop illegal villa construction by developers in collusion with local officials in the nature reserves of the Qinling Mountains. This also reflected the local resistance encountered by the reform in the ecological field back then.

Xi has been pushing through reform in adversity and had to break the blockades of vested interests. "We need the courage to 'venture into the mountain despite knowing full well there are tigers' and continuously move the reform forward," he said.

Less than 20 days after assuming the top office, Xi oversaw the formulation of the "eight-point decision" on improving Party and government officials' work conduct, to address chronic issues in the bureaucracy such as official privileges, extravagant banquets and other forms of waste of taxpayers' money. This move was later hailed as a "game changer" for China's governance.

On that basis, Xi initiated an unprecedented anti-corruption "storm." The fight against corruption is beneficial for purifying the "political ecosystem" as well as the "economic ecosystem," and is conducive to straightening out the market order and restoring the market to what it should be, he said.

The "zero-tolerance" anti-corruption campaign continues to roar. Over the past year, it has made waves across sectors, including finance, grain supply, healthcare, semiconductor development and manufacturing, and sports.

Hundreds of high-ranking government officials, bank executives and hospital directors, even figures like the president of the Chinese Football Association and former head coach of the national men's football team, were investigated or indicted.

Xi advocated the necessity of reforming the Party, calling for "the most thorough self-revolution."

Under his leadership, a full and rigorous Party self-governance system was built, and a sound system of Party regulations has taken shape. He improved the inspection system and established the national supervision system, to "confine power to an institutional cage."

He also initiated an unprecedented reform of the Party and state institutions.

This reform has been the most eye-catching part of the country's overall reform process, commented Li Junru, former vice president of the Party School of the CPC Central Committee. "Xi uses reform to address unique challenges facing the Party and to build a stronger and more powerful Marxist political party," Li added.

Such reform further dismantled vested interests. Xi has called for the resolve to "offend a few thousand instead of failing the 1.4 billion Chinese people."

He propelled the Party's self-revolution to guide social changes. The Party has taken the initiative to eliminate institutional deficiencies in social development to unlock productive forces, as explained by Liu Bingxiang, a professor at the Party School of the CPC Central Committee.

In this regard, Xi has advocated fully advancing law-based governance, striving to solve the long-standing problems of power outweighing the law and personal relationships trumping legal principles.

He once lashed out at the phenomenon where "money can buy exemption from punishment and even buy life." On another occasion, he said: "The socialist market economy is an economy based on credit and the rule of law."

He has instructed the formulation and revision of a series of laws, including the Anti-Monopoly Law, which provides the legal basis for the fair competition review system.

The legal system for intellectual property rights was also improved. In a typical case, U.S. basketball legend Michael Jordan won a lawsuit in 2020 in Shanghai, with a Chinese company ordered to cease using "Qiao Dan," the Chinese translation of "Jordan," in its name and product trademarks.

Xi's reforms have not only led to economic transformation. He has asserted that the essence of modernization lies in the modernization of the people. Fostering "cultural confidence and national pride" among the Chinese people has become a key objective of the reform.

In 2012, Xi incorporated "cultural confidence" into a keynote report to the 18th CPC National Congress. He later integrated this concept into the "Four Confidences" of socialism with Chinese characteristics, describing cultural confidence as a "more fundamental, deeper and more enduring force."

Xi's reforms also signify a reworking of Marxism to adapt to the new era, integrating its basic tenets with China's specific realities and fine traditional culture. As a result, China's reforms have assumed fresh philosophical significance.

In his 2017 New Year Message, Xi stated that "the main framework of reform, resembling the 'four beams and eight pillars' of a house, has been essentially established in various fields." For those acquainted with traditional Chinese architecture, this signifies that the house has taken shape and can be further perfected.

Xi has directed reforms toward an overarching goal: upholding and improving the system of socialism with Chinese characteristics and modernizing China's system and capacity for governance.

This, undoubtedly, takes a long and challenging process to fulfill.

ONLY REFORMERS CAN ADVANCE, ONLY INNOVATORS CAN THRIVE

In the year when Xi assumed the top office, China's annual economic growth rate dropped below 8 percent for the first time since 1999.

The debt crisis in Europe severely hurt China's foreign trade, and real estate regulation dragged down domestic demand. A foreign bank analyst claimed that "China's economy is facing its most critical moment in nearly 30 years."

Undeterred, Xi identified where reform should head. He was convinced that development still holds the key to solving all problems, and made boosting development a top priority in his reform agenda.

Xi pointed out that China's economy had entered a new development stage and proposed a new development philosophy featuring innovative, coordinated, green, open and shared growth. He initiated the supply-side structural reform, pushed the economy toward high-quality development and moved to construct a new development pattern.

Addressing officials on the significance of the reform to optimize supply structure, Xi cited the example of Chinese tourists buying smart toilet seats and rice cookers abroad, as they couldn't find such innovative or high-quality products on the home market. Meanwhile, some domestic producers were struggling to find customers.

After years of supply-side structural reform under Xi's watch, a new generation of China-made products is enjoying rising popularity at home and abroad. These include energy-saving home appliances, smart electronics, sports gear made from new materials, and large passenger planes.

Overcapacity in certain sectors was effectively tackled. For instance, by the end of 2022, the steel industry had eliminated outdated and excess capacity totaling around 300 million tonnes, exceeding twice the size of the entire crude steel production of India that year.

To push forward the supply-side structural reform, Xi led by example with great foresight. A decade ago, most cars on China's roads were gasoline vehicles. In 2014, during an inspection tour of SAIC Motor, a major Chinese carmaker, Xi emphasized the significance of developing products that cater to diverse needs and highlighted the importance of new energy vehicles in strengthening China's position in the automotive sector.

In the following decade, Xi became a big fan of electric cars, visiting automotive companies, touring laboratories, and showing great interest in trying new home-developed models. He encouraged carmakers to focus on product quality and cultivate market competitiveness.

The new energy industry is, in fact, part of Xi's vision of "new quality productive forces." This new phrase first mentioned by Xi during last year's local inspections has quickly become a buzzword for the Chinese economy, but Xi had started relevant practice since a much earlier date.

Back in the 1970s in the Liangjiahe village of Shaanxi, Xi became the first person across the province to introduce the use of biogas-generating facilities, which could be categorized as "new quality productive forces" at that time, to give fellow villagers a clean replacement of firewood and kerosene used for cooking and lighting.

A firm believer in Marxism, Xi regards the notion of productive forces as "the ultimate cause of all social and political changes."

Developing new quality productive forces, which feature innovation and high quality, is a call to action by China's policymakers to ride the new wave of tech revolution unfolding in such areas as artificial intelligence, synthetic biology, nanotechnology, and quantum information through reform. It also aligns with the innovation-driven development strategy proposed by Xi.

He likened China's lack of strong innovation capability to the Achilles' heel of an economic giant. "Only reformers can advance, only innovators can thrive, and only those who reform and innovate will prevail," he said.

Under his guidance, reform in the science and technology realm was advanced with unprecedented intensity. Spurred by a slew of pro-innovation measures, a new system for mobilizing resources nationwide was leveraged to facilitate key technological breakthroughs, the country's first group of national laboratories set up, and enterprises' principal role in innovation reinforced.

The effects are evident, with China's ranking in the Global Innovation Index, published by the World Intellectual Property Organization, jumping from 34th in 2012 to 12th last year.

Data issued in 2023 showed that China in 2022 overtook the United States for the first time as the No. 1 ranked country for contributions to research articles published in the Nature Index group of high-quality natural science journals.

Despite years of U.S. suppression and chip sanctions, Chinese telecom giant Huawei managed to launch its new high-end smartphones in 2023. Many saw it as proof that the attempted containment of China's tech sector by some Western countries would hardly work.

Yet, there is still much work to be done. Xi has cautioned: "Basic research is the source of sci-tech innovation. Although China has made significant progress in basic research, the distance between us and the international advanced level remains evident."

He has called for further institutional reforms to strengthen basic research, as well as support for original innovation and faster development of strategic, cutting-edge and disruptive technologies.

UNLEASHING THE POWER OF THE MARKET

When Xi assumed Party leadership, two decades had passed since the concept of building a socialist market economy was established.

However, doing business remained a challenging endeavor. In 2014, a lawmaker attending local "two sessions" revealed that a single investment project, from acquiring land to completing all administrative approval procedures, required more than 30 government approvals and over a hundred stamps. The entire process took a minimum of 272 working days.

Xi strongly opposes cumbersome government approvals. While working in the city of Fuzhou, Fujian, he pioneered a mechanism that enabled all procedures for investment project approval to be completed in a single building.

As the country's top leader, he advocated that "the market plays the decisive role in resource allocation and the government plays its role better."

Over the years, the State Council, or the Chinese cabinet, has canceled or delegated to lower-level authorities the power of administrative approval for over 1,000 items, and slashed the number of investment items subject to central government approval by over 90 percent.

"Let the vitality that creates wealth burst forth, and let the power of the market be fully unleashed," said Xi.

The results of the reforms are remarkable, as China was ranked by the World Bank as one of the top 10 economies with the most notable improvement in business environment for two years in a row.

In 2019, construction started for Tesla's Shanghai Gigafactory in January, and by December the automaker already started delivering the first batch of China-made Model 3 electric cars built at the factory. Such fast development won praise from Tesla CEO Elon Musk. In May this year, the U.S. company's first overseas Megapack factory broke ground in Shanghai, once again standing as a strong testament to the "China speed."

Well-acquainted with the challenging situation faced by private enterprises, Xi has instructed the establishment of a private economy development bureau under the country's top economic planner to provide assistance to private enterprises facing difficulties.

Xi also emphasized the need to promote financial reforms to facilitate financing for private enterprises. He stressed the importance of encouraging private capital to enter industries and sectors where entry is not explicitly prohibited by laws and regulations.

Under Xi's instruction, the system of a negative list for market access was comprehensively implemented, allowing entry into areas not explicitly prohibited by the list. By the end of 2023, the number of registered business entities nationwide reached 184 million, more than three times the figure in 2012.

From 2012 to 2023, the number of private enterprises in China more than quadrupled, and the proportion of private enterprises in the total number of enterprises increased from less than 80 percent to over 92 percent.

During that period, privately-owned banks received approval for establishment, a high-speed rail controlled by private capital began operation, private investment was permitted to enter the oil and gas exploration and production sector, and a private rocket company achieved success in launching a rocket from the sea.

Xi also initiated market-oriented reforms for state-owned enterprises (SOEs). In 2017, China Unicom, as the first centrally-administered SOE in the telecommunications industry to open up to private capital, introduced 14 strategic investors, including Internet titans Tencent, Baidu, JD.com and Alibaba, in the "mixed-ownership reform."

A three-year action plan for SOE reform further converted SOEs into limited liability companies or companies limited by shares. Some 38,000 SOEs established boards of directors.

International media have noticed that China's reform has been advancing in step with changes in the situation. A trade war waged by the United States, the global pandemic, and increased geopolitical tensions have tested the resilience of China's economy. The country is also transforming its economic development model.

Xi has led China to accelerate building the new development pattern, which takes the domestic market as the mainstay while allowing domestic and international markets to reinforce each other.

A key support for this strategy is the establishment of a unified national market. To achieve this, a series of reforms are being implemented to eliminate local protectionism and dismantle regional barriers.

Li Junru, the veteran Party theorist, said Xi drew new "dots," "circles" and "belts" on China's map as he advanced inter-regional coordination and boosted the development of the Xiong'an New Area, the Yangtze River Delta and the Guangdong-Hong Kong-Macao Greater Bay Area, among others.

Xi has doubled down on opening-up efforts to push forward reform and made "institutional opening-up" a priority. In one such move, China has lifted foreign ownership limits for securities companies, management companies of securities investment funds, futures companies and life insurance companies.

China is pushing for accession to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, as the government strives to meet the high standards set by the agreement and commits to practices that go beyond existing market access policies.

In 2013, Xi set up the country's first pilot free trade zone in Shanghai. Currently, the number of such zones has reached 22, with the entire tropical island province of Hainan becoming a free trade port.

Another significant reform step taken by Xi is the establishment of the China International Import Expo, the world's first national-level exhibition with a focus on expanding imports.

He has also initiated a fair to facilitate trade in services and an expo featuring the display of global consumer products, showcasing his vision for trade liberalization and economic globalization.

China is now the main trading partner of more than 140 countries and regions, and has maintained its position as the world's second-largest foreign direct investment destination.

Meanwhile, Xi is cautious about disorderly capital expansion, market manipulation and the pursuit of exorbitant profits in certain areas, guarding against risks similar to the U.S. subprime crisis.

He proposed setting "traffic lights" for capital flows, ensuring that "financial magnates" do not act unscrupulously while still allowing capital to function properly as a production factor.

This indicates that China's reform is no longer solely focused on growth, but considers a more balanced approach.

Coordinating development and security stands out in Xi's campaign to deepen reform in all aspects. China remains the world's only major economy free from any financial crisis over the past four decades.

MAKING PEOPLE'S PRIORITIES HIS OWN

Xi emphasizes that the ultimate goal of China's reform is to improve the people's well-being. He has pledged to make people's priorities his own and act on their wishes, a stark difference from the "capital first" approach often seen in a capitalist economy.

In 2017, Xi pointed out that after nearly 40 years of reform and opening-up, the principal contradiction facing Chinese society had undergone significant changes. "What we now face is the contradiction between unbalanced and inadequate development and the people's ever-growing needs for a better life," he explained.

In response to this change, he advocates for coordinated and shared development, and commits himself to achieving Deng Xiaoping's vision of "common prosperity."

When Xi took over the helm in 2012, significant disparities existed between China's eastern and western regions, and wealth inequality was severe.

He has transformed the poverty relief strategy, implementing a new approach called "targeted poverty elimination."

The individuals and villages confirmed as poor were registered and a file was created in the national poverty alleviation information system. Meanwhile, the impoverished were relocated from inhospitable areas. Governments promoted industries in line with local conditions and organized training classes for the underprivileged to help raise their income. Over 3 million officials were dispatched to be stationed in designated villages to ensure poverty relief measures were fully and well enforced.

Under Xi's leadership, China eradicated absolute poverty in its rural areas, a problem that had persisted for several thousand years.

China's reforms started in the rural areas in the late 1970s, and Xi's reform initiatives regarding agriculture, rural areas and farmers encompass a broader range of changes.

He has established a sound mechanism for stable grain production to ensure that "China's food supply remains firmly in its own hands," improved the village business environment, and promoted rural revitalization across the board.

In the early 2000s, Xi proposed in an academic paper bold reforms to the household registration system to eliminate various social and economic disparities, as well as the division of the urban and rural labor markets caused by the system. At that time, there was much controversy about whether or not the household registration restrictions should be abolished.

In 2016 the central government rolled out a plan to grant urban residency to some 100 million people from rural areas and other permanent residents without local household registration, and this goal was fulfilled ahead of schedule.

During an inspection trip to Shanghai in 2023, Xi visited the apartments where migrant workers lived. He was happy to learn that migrants were settling down in the metropolis.

"Great! Stay, settle down, and strive for a better life," he said.

Under Xi's leadership, China scrapped the reeducation-through-labor system, which had been in operation for over half a century, raised the threshold for personal income tax exemption from 3,500 yuan to 5,000 yuan per month, and laid down a people-centered principle for the real estate sector's development -- "Housing is for living in, not for market speculation."

In response to demographic changes, China has adjusted its population and family planning policies. Reforms have been carried out to ensure better and more equitable education. Additionally, Xi has spearheaded the establishment of the world's largest social security system and initiated reforms in basic elderly care services. Today, the numbers of people covered by basic old-age insurance and basic medical insurance in China have exceeded 1 billion and 1.3 billion, respectively.

With the belief that "people's health is the primary indicator of modernization," Xi called for studying and promoting the practice in the city of Sanming in Fujian to push forward the healthcare reform.

Xi advocated for the comprehensive elimination of markups on drugs and medical consumables that had been in place for over 60 years, reducing patients' costs. Government departments acted on his call and formed a work team to negotiate drug and consumable prices with pharmaceutical companies.

In a widely circulated online video of such price negotiations in 2021, representatives from the National Healthcare Security Administration insisted that "no minority group of patients should be abandoned," and managed to cut the price of a life-saving drug for a rare disease from about 700,000 yuan per shot to 33,000 yuan per shot through eight rounds of intense negotiations.

This drug was then included in China's medical insurance catalog, igniting hope for over 30,000 patients nationwide. Similar price cuts for hundreds of drugs have in several years cumulatively saved the public some 500 billion yuan in medical expenses.

Xi has advanced reforms in the rural healthcare system to ensure that people in the vast countryside have access to affordable medical treatment. The campaigns have significantly reduced cases of illness-induced poverty. Almost all low-income people and individuals just lifted out of poverty in the rural areas now have medical insurance.

Xi's reform in the cultural sector emphasizes enriching the "spiritual world" of the people as an essential requirement for Chinese modernization. This involves refining cultural industry planning and policies, and nurturing new cultural business forms and cultural consumption patterns.

As a result, the film industry has seen fast development in recent years. The number of cinema screens in China increased from about 13,000 in 2012 to over 86,000 at the end of 2023, the highest in the world. The New York Times reported earlier this year that China's film industry is producing more high-quality movies that resonate with domestic audiences.

Xi also revamped the educational system, which directly relates to the expansion of the talent pool and the sci-tech advancement.

He moved to promote the balanced development of compulsory education, reduce the heavy workload of students to ensure their well-rounded development, and build a modern vocational education system and a modern university system.

The proportion of national fiscal expenditure allocated to education has remained above 4 percent of GDP for consecutive years, making it the largest share of China's general public budget spending.

Another ground-breaking reform led by Xi occurred in the ecological domain.

When Xi became the Party's general secretary in 2012, environmental pollution was one of the most common complaints among the public. At the start of that year, cadmium pollution affected a river in Guangxi Zhuang Autonomous Region, endangering the drinking water safety of over a million people. Several high-profile "not-in-my-backyard" incidents triggered by industrial pollution concerns occurred across the country during the year.

Xi, known for bold and resolute environmental initiatives in Xiamen to clean up the Yundang Lake and in Hangzhou to protect the West Lake, established the Ministry of Ecology and Environment, set ecological and environmental protection as an inviolable "red line," introduced inspections on ecological and environmental protection by central authorities, and asked local officials to be responsible for the protection of rivers, lakes and forests as their "management chiefs."

Under Xi's leadership, China became the country with the fastest improvement in air quality, the largest increase in forest resources, and the largest area of afforestation globally. The country has also held a steady position as the world leader in installed capacities for hydro, wind, solar and biomass power generation.

China has also developed the world's largest carbon market and vowed to achieve carbon neutrality after carbon peaking in a much shorter time span compared with developed countries. "Green and low-carbon development is the order of the day, and those who follow it will prosper," Xi said.

Xi believes that correcting unsustainable growth methods is essential for the sustainable development of the Chinese nation and for protecting Mother Earth -- "our one and only home."

FORGING AHEAD WITH COURAGE

"No other country around the world can comprehensively advance reform in the same way as present-day China does, with a commitment to its promises and a sense of urgency," said a report by the Singaporean newspaper Lianhe Zaobao.

According to the 2023 Edelman Trust Barometer, a survey conducted by consulting firm Edelman, China's overall trust level was 83, ranking first among all surveyed countries.

China was the only country among those surveyed that expressed optimism about economic prospects, according to the survey.

Observers believe that with Xi as the helmsman of reform in the new era, the socialist market economy heralded by Deng Xiaoping will undoubtedly continue and thrive. Xi has ignited the engine propelling China on an irreversible journey toward modernization.

Deng's reforms and his proclamation that "development is the absolute principle" liberated and developed China's social productive forces, catapulting the country into the position of a global economic powerhouse.

Xi has held that high-quality development is the unyielding principle of the new era, and initiated a comprehensive and systematic transformation in China, which has greatly contributed to the re-balancing of the world economy.

Last year, China's economy grew by 5.2 percent, contributing one-third of global growth. The country remains a strong global growth engine.

In meetings with foreign government and business leaders this year, Xi's message has been consistent: China is committed to furthering reform, which will bring opportunities to the world.

Visiting France in May, Xi told businesses there that China's reform would provide a broader market space for all countries. In Serbia, he visited the Smederevo steel plant, which he helped resuscitate with Chinese investment about eight years ago, saving jobs for over 5,000 local workers.

The plant is a flagship project of Xi's signature Belt and Road Initiative (BRI). Inspired by the ancient Silk Road, Xi proposed the initiative in 2013 to reform and enhance global development cooperation. He designed the BRI as a modern network linking countries through enhanced trade, infrastructure development, and people-to-people exchanges.

In a decade, the BRI has garnered participation by three-quarters of the world's countries, helping create 420,000 jobs and lift tens of millions of people out of poverty in those countries.

Since last year, the anticipation for the third plenum of the 20th CPC Central Committee has kept building up. People in China and the world at large are closely watching what major reform measures are to be unveiled, and gauging the potential impact of such measures.

Before the plenum, Xi had promised a series of "strategic, innovative and leading reforms," in order to "achieve new breakthroughs in important areas and key sectors."

There are reasons to be optimistic. Such optimism is based not only on China's enormous economic and market size but also on the unified leadership of the Party with Xi at the core. The CPC has the guts for self-reform and is capable of turning blueprints into concrete actions.

As some people overseas have doubts or even fears about China's reform, development and their implications, Xi has often said that China has no intention of changing or challenging the existing world order. It is just taking a more active part in global governance, and pushing for a more just and equitable world order.

"China's modernization has offered a new choice and has far-reaching implications for developing countries," said Jose Ricardo dos Santos Luz Junior, the CEO of a Sao Paulo-based company that connects Chinese and Brazilian entrepreneurs.

In the early days of Deng's reform era, the late Chinese leader stated that the goal of China's reform and opening-up was to "catch up with the times."

Today, reflecting on nearly half a century of progress, Xi pointed out that China's reform and opening-up has not only advanced its own development but also made significant contributions to global peace and progress.

Carrying on Deng's legacy and with a strong sense of responsibility, Xi is leading China on a path of modernization that not only creates economic miracles and development opportunities, but also explores a new form of human civilization.

"Our modernization is both the most challenging and the greatest," said Xi. "This is an unprecedented path, but we will continue to explore it and forge ahead with courage." Enditem

(by Xinhua writers Zhou Xiaozheng, Zhang Zhengfu, Wu Jihai, Cheng Yunjie, Xu Lingui, Wang Xiuqiong, Zhang Zhongkai, Shi Hao, Wang Yaguang, Zhang Bowen and Fu Min)

(Editor's note: This story is an updated version of a same-titled piece released by Xinhua English newswire on March 12, 2024.)

特稿｜改革家习近平

新华社北京7月15日电 题：改革家习近平

新华社记者

中共二十届三中全会15日在北京开始举行，习近平总书记带领全党全国踏上进一步全面深化改革新征程。

一段时期以来，他提出新一轮改革要“进一步解放思想、解放和发展社会生产力、解放和增强社会活力”，“为中国式现代化提供强大动力和制度保障”，受到广泛关注。

　　这也有力回应了外界对中国改革与经济发展前景的臆断猜测。

　　习近平执政的新时代也是改革的新时期。中国综合实力持续增长，国际影响力不断提升。面对各种机遇挑战，现在到了新一轮改革提速的关键期。

“改革不停顿，开放不止步”

　　习近平被认为是邓小平之后的又一位卓越的改革家。他们肩负相同的使命：使中国实现现代化。但两人面对的形势迥然不同。

　　邓小平发起改革开放的1978年，中国人均GDP不到200美元。改革几乎从零开始。而2012年习近平就任中共中央总书记时的中国，已是世界第二大经济体，人均GDP突破6000美元。同时许多发展红利正在消退，包括曾经低廉的劳动力成本。

　　“容易的、皆大欢喜的改革已经完成了，好吃的肉都吃掉了，剩下的都是难啃的硬骨头。”习近平说。他拒绝躺在前人功劳簿上休息，而是继续冲刺。10多年来，中国出台2000多个改革方案，经济总量翻了一番多，并保持了世界经济增长第一引擎位置。

　　但面对老百姓对于更美好生活的期盼，为保持新冠疫情后经济恢复势头，以及防范各种风险等，还需付出重大努力。

　　在习近平看来，未来要实现现代化，续写中国奇迹，仍然要用好改革开放这个重要法宝。

　　在今年初的中央政治局集体学习上，习近平重申改革。两会上，他要求加快推动各方面改革。在多次离京考察途中，他反复强调“改革是发展的动力”。

　　5月下旬，他在济南主持召开企业和专家座谈会，听取对进一步全面深化改革的意见和建议。与会的中国宏观经济研究院院长黄汉权告诉新华社记者：“座谈会气氛很活跃。可以看出改革在总书记心中分量很重，而且他对改革方方面面情况非常了解。”

　　习近平今年春季在会见美国工商界和战略学术界代表时说：“我们正在谋划和实施一系列全面深化改革重大举措，持续建设市场化、法治化、国际化一流营商环境，为包括美国企业在内的各国企业提供更广阔发展空间。”

　　习近平的改革情结一以贯之。上世纪60年代末，他不满16岁下乡插队，在陕北黄土高原贫瘠的梁家河村劳动7年，经常挨饿，那时他的愿望就是让乡亲们吃饱饭。他对后来邓小平发动改革的初衷——中国“不能再穷下去了”深为认同。

　　同邓小平一样，习近平的改革动力也来自人民的期待。他在梁家河时就带领乡亲实施了一些大胆改革举措，包括办铁匠铺、建商铺和改善农田生态条件。

　　习近平有改革家传。在改革伊始的1978年，习近平的父亲习仲勋受中央委派南下主政广东，创办深圳等经济特区。那年，正在清华大学学习的习近平受父亲委托到安徽滁州实地调研家庭联产承包责任制。他记了一大本笔记，收藏了40多年。

　　习近平在每一个地方任职都是改革先锋。在正定，他力主包产到户，使贫困的正定成为河北省第一批包产到户试点县。刊载于1985年第1期《中国青年》的一篇报道描写了习近平领导下的正定新面貌：“山西省一位县委书记到正定参观，临行前感慨地说：‘这里，听不见人人喊改革，但处处在改革。’”

　　“现在回过头来想一想，如果说我们做到了什么，其中之一就是做到了解放思想这一条。”习近平回忆正定改革时这样说。

　　习近平离开正定后去了经济特区厦门。在那里他推动成立中国第一家中外合资银行——厦门国际银行。担任福建省省长时，习近平率先在全省推行集体林权制度改革，这项改革后来在全国推开，被称作家庭联产承包责任制后中国农村的又一场革命。

　　调任浙江后，他开创性提出“腾笼换鸟”的改革构想，并成为最早参加浙商活动的省委书记，他让民营企业家有重要事情可以直接去办公室找他。他将浙江的改革从经济、政治领域推进到文化、社会、生态各方面。

　　他的改革者风貌令国际人士印象深刻。2006年9月时任美国财长亨利·保尔森首次访华，把杭州定为第一站，认为时任浙江省委书记的习近平是他到中国会见第一人的“完美人选”。“他是那种知道怎样攻破球门的人。”保尔森如此评价习近平。他后来回忆，2014年的一次会见中，习近平曾对他说“改革相关事宜是我关注的重中之重”。

　　上海任上，习近平要求该市通过改革实现“创新驱动”发展，推动国际金融中心建设，当好改革开放的排头兵。

　　2012年，习近平任总书记后离京考察的第一站，即循着父亲足迹来到深圳，向莲花山公园的邓小平铜像敬献花篮，宣示自己的坚定决心：“改革不停顿，开放不止步！”

　　1978年，邓小平通过中共十一届三中全会开启了改革开放和社会主义现代化建设新时期，而2013年习近平主导的十八届三中全会同样具有里程碑意义，开启了全面深化改革、系统整体设计推进改革的新时代。

　　在这次全会上，习近平列举了一长串中国发展面临的挑战，包括腐败现象、发展不可持续、生态环境恶化等。他说：“解决这些问题，关键在于深化改革。”

　　全会通过《中共中央关于全面深化改革若干重大问题的决定》。西班牙《世界报》说：“习近平开启了中国30年来最深刻的经济、社会和行政改革的序幕。”

　　1个多月后，中央政治局召开会议，决定成立由习近平任组长的中央全面深化改革领导小组，这是中共历史上首次在党中央层面设置专司改革工作的领导机构。后来这个小组成为中央全面深化改革委员会，由习近平任主任。

　　“重大改革事项，都由习近平总书记一锤定音。”一位熟悉情况的负责改革的部门领导告诉记者，重大改革方案每一稿他都认真审阅，逐字逐句亲笔修改。

“明知山有虎，偏向虎山行”

　　习近平的全面深化改革，基于他从长期实践中得出的深思熟虑，并形成一整套顶层设计。他认为改革创新是中华民族的文化基因，用中国古训“革故鼎新”来激励人们。

　　在改革方向上，习近平头脑清醒。他用“邯郸学步”、“画虎不成反类犬”、“水土不服”、“死路一条”来警告否定社会主义方向的改革将带来严重后果。“不能改的坚决不改。”他说。习近平强调，改革要“坚持党的全面领导”。

　　对于应该改的，习近平要求坚决改，暂不具备条件的也创造条件改——包括改掉一切束缚经营主体活力、阻碍市场和价值规律充分发挥作用的弊端。习近平的全面深化改革范围、规模和力度空前，全方位覆盖经济、政治、文化、社会、生态文明、党的建设、国防和军队等各个领域。

　　他实现了新时代改革理论的创新，并提出科学的改革方法论，包括：处理好解放思想和实事求是的关系、整体推进和重点突破的关系、顶层设计和摸着石头过河的关系、胆子要大和步子要稳的关系、改革发展稳定的关系。他要求用“五位一体”总体布局和“四个全面”战略布局来统率改革。

　　他格外注重改革的“系统性、整体性、协同性”，要求在改革中尊重群众首创精神，把握好推动改革的时度效。掌舵关乎14亿人口福祉的改革，他提出“稳中求进”、“先立后破”，确保改革符合中国实际。

　　“他纠正了‘唯GDP论英雄’。”一位陕西官员说。他回忆习近平先后6次批示，制止官商勾结在秦岭自然保护区建别墅。这件事也反映出生态领域改革当时遇到的地方利益集团阻力。

　　习近平的改革一直在艰难中突围。他要打破更多的利益藩篱。他说：“这个时候需要‘明知山有虎，偏向虎山行’的勇气，不断把改革推向前进。”

　　任总书记不到20天，他就主持制定“八项规定”，根治官场公款吃喝、铺张浪费等沉疴痼疾。这一措施坚持至今且不断完善，人民由衷赞叹“八项规定改变中国”。

　　以此为起点和切入口，习近平掀起史无前例的反腐风暴。他说：“反腐败斗争有利于净化政治生态，也有利于净化经济生态，有利于理顺市场秩序、还市场以本来的面目。”

　　“零容忍”的反腐斗争10多年从未间断，过去1年多来继续席卷金融、粮食、医疗健康、半导体等行业和体育界，数百名高级官员、银行高管、医院负责人甚至足协主席、国足主教练等落马。

　　治标更治本。习近平提出对中共这一百年大党进行改革，发起“最彻底的自我革命”。他领导构建全面从严治党体系，形成比较完善的党内法规体系，建立健全巡视制度和国家监察体系，“把权力关进制度的笼子里”。

　　“习近平总书记发起的党和国家机构改革，是改革中最受瞩目的。他用改革来解决大党独有难题、建设更加坚强有力的马克思主义政党。”中共中央党校原副校长李君如说。

　　这是“动奶酪”最大的一次改革。习近平说：“得罪千百人，不负十四亿。”

　　由此，他使改革进入纵深领域，以党的自我革命引领社会革命——“党主动改革不适应生产力发展要求的生产关系以及不适应经济基础的上层建筑，改变一切不适应生产力发展的管理方式、活动方式和思想方式，不断革除社会发展的体制机制弊病，进一步解放生产力、发展生产力。”中央党校教授刘炳香说。

　　在全面从严治党同时，习近平推动全面依法治国，通过司法改革等打破几千年权大于法的人治痼疾和事事讲人情托关系的社会风气。在一次会上，习近平痛斥“花钱可以免罪、花钱可以买命”的现象。他说，“社会主义市场经济是信用经济、法治经济”。

　　他领导制定和修订一批法律，包括反垄断法，将公平竞争审查制度上升为法律规定。知识产权的法律体系得到健全。在2020年宣判的一起典型案件中，中国法院判决一家福建企业侵害美国球星迈克尔·乔丹的姓名权，要求其停止在商标上使用。

　　海外舆论称中国新时代的改革为“习式改革”，而这不是一场简单的“经济转型”。习近平认为，现代化的本质是人的现代化。因此，改革的目标是塑造新时代的中国人，让人们“树立文化的自信、民族的自豪感”。2012年，他要求在党代会报告中写入“文化自信”。随后他将这个概念纳入中国特色社会主义“四个自信”，并称文化自信是“更基本、更深沉、更持久的力量”。

　　“习式改革”也意味着将马克思主义做了适应新时代和现实国情的再造，也使其与中华优秀传统文化结合在一起。

　　改革便因此具有了崭新的哲学意义，并显现出高度重视制度建设的特征——改革更多面对的是深层次体制机制问题，因此做了大量建章立制、构建体系的工作。

　　在作为国家主席发表2017年新年贺词时，习近平说，“各领域具有四梁八柱性质的改革主体框架已经基本确立”。了解中国传统建筑的人知道，“四梁八柱”搭起，屋子就已成形，可以进一步完善了。

　　习近平将全面深化改革指向一个总目标：完善和发展中国特色社会主义制度，推进国家治理体系和治理能力现代化。这无疑是一个长期而艰巨的进程。

“惟改革者进，惟创新者强”

　　习近平就任总书记当年，中国经济增速自1999年以来首次降到8%以下。欧洲债务危机重创外贸，房地产调控拖累内需，有外资银行分析师称，“中国经济已经到了近30年最危急的时刻”。

　　习近平确定了改革的主攻方向——坚持发展仍是解决所有问题的关键，仍然要把发展作为第一要务。

　　习近平认为中国经济进入新的发展阶段，他提出创新、协调、绿色、开放、共享的新发展理念，发动供给侧结构性改革，推动经济转向高质量发展，构建新发展格局。

　　为让官员们更好理解改革发展的现实意义，习近平用中国游客到国外买马桶盖和电饭锅的故事来给他们“上课”。当时，不少中国人热衷从海外购买从奢侈品到日常生活用品的各类商品，一些国内企业的产品却卖不出去。

　　通过习近平倡导的供给侧结构性改革，产能过剩困境得到缓解，其中钢铁行业截至2022年底淘汰落后和化解过剩产能约3亿吨，超过当年印度全国粗钢产量两倍。从节能环保家居产品到新材料运动装备，从智能电子设备到国产大飞机，越来越多产品受到海内外消费者的欢迎。

　　为推动改革，习近平身体力行，展露出敏锐的超前眼光。10年前，中国公路上跑的绝大多数是燃油车。2014年，习近平考察上海汽车集团，提出“开发适应各种需求的产品”，发展新能源汽车，使中国从汽车大国迈向汽车强国。

　　此后10年，习近平几乎成了电动汽车的“超级粉丝”，多次考察汽车公司，参观实验室，试坐电动汽车，鼓励生产者注重产品质量，形成市场竞争力。

　　新能源产业，实际上是习近平提出的新质生产力的一部分。虽然新质生产力是他去年国内考察调研时使用的新语汇，但他早已在推动发展。比如，在上世纪70年代的梁家河，他就率先把沼气引进陕西，使村民用上“新能源”灯，用气而不是靠砍柴来烧饭，既便利了生活，又保护了环境。

　　习近平多次通读《资本论》，是历史唯物主义和辩证唯物主义的坚定信仰者，他视生产力为“一切社会变迁和政治变革的终极原因”。

　　以“创新”、“质优”为特征的新质生产力反映了中国决策者面对新一轮科技革命——以人工智能为代表，汇聚生命科学、量子计算、纳米技术、新能源、新材料、太空和深海技术等——推动改革的紧迫感，而这与习近平提出的创新驱动发展战略一脉相承。

　　习近平说：“创新是引领发展的第一动力。”他将创新能力不强比喻为“我国这个经济大个头的‘阿喀琉斯之踵’”。

　　“惟改革者进，惟创新者强，惟改革创新者胜。”习近平说。他以前所未有的力度推动科技体制改革，发挥新型举国体制优势，组建首批国家实验室，强化企业科技创新主体地位，改革科技评价制度。“揭榜挂帅”、“赛马制”得到推行。中共二十大报告首次对教育、科技、人才工作专章部署、一体统筹。

　　改革的效果已然呈现，中国的全球创新指数排名从2012年的第34位跃升至2023年的第12位。去年5月发布的自然指数数据显示，中国作者2022年在高质量自然科学期刊上发表论文份额首次排名第一，超过了美国。

　　2023年，已遭美国全方位封锁打压多年的华为推出搭载自研芯片的新手机，舆论认为，这说明一些西方国家对中国的科技围堵难以奏效。但这还远远不够。习近平提醒：“基础研究是科技创新的源头。我国基础研究虽然取得显著进步，但同国际先进水平的差距还是明显的。”

　　他要求深化基础研究体制机制改革，支持原始创新，加快发展战略性、前沿性、颠覆性技术。

“让市场力量充分释放”

　　习近平上任总书记时，距离1992年中共十四大提出建设社会主义市场经济体制已有20年，但一些企业要办成一件事仍然很难。2014年，一位人大代表在地方两会上“晒”出一张“行政审批长征图”：一个投资项目从获得土地到办完手续，需经过30多项审批，盖上百个章，全程最少需历经272个审批日。

　　习近平痛恨繁琐而低效的审批。他在福州工作时，便率先倡导简政放权，创造性实行投资项目审批“一栋楼办公”，全部手续不用出楼即可办成。任总书记后，他拍板将“使市场在资源配置中起决定性作用和更好发挥政府作用”写入党中央文件。几年来，国务院取消和下放行政许可事项1000多项，中央政府层面核准投资项目压减90%以上。

　　“证照分离”等商事制度改革让企业开办时间压缩到平均4个工作日以内。企业去政府办事，“一颗印章管审批”、“最多跑一次”甚至“一次都不跑”的情况越来越多。2024年1月国务院又出台“高效办成一件事”的指导意见。

　　“让创造财富的活力竞相迸发，让市场力量充分释放。”习近平说。

　　改革的结果是，中国被世界银行评为营商环境改善幅度最大的十大经济体之一。美国企业特斯拉是受益于改革的一个例子。2019年，特斯拉上海超级工厂实现“当年开工、当年竣工、当年投产、当年上市”，公司首席执行官马斯克说，这创造了令人惊叹的上海速度，也创造了全球汽车制造业的新纪录。今年5月，特斯拉上海储能超级工厂动工，再次见证中国速度。

　　习近平十分关心并熟悉民营企业的情况。在一次会议上，他痛心地说，民营企业遇到了“三山”、“三门”，即“市场的冰山”、“融资的高山”、“转型的火山”和“玻璃门”、“弹簧门”、“旋转门”，要做的是“搬山破门”。

　　他指示设立民营经济发展局，为民企纾难解困。他要求推动金融改革，为民企融资提供便利。同时，“凡是法律法规未明确禁入的行业和领域都应该鼓励民间资本进入，凡是我国政府已向外资开放或承诺开放的领域都应该向国内民间资本开放”。

　　在习近平指示下，“有恒产者有恒心”写入中央文件。在工程建设和招标投标、政府采购等领域，不当市场干预行为被专项整治。市场准入负面清单制度全面实施，清单之外“非禁即入”。截至2023年底，全国登记在册经营主体达1.84亿户，是2012年的3倍多。

　　首批民营银行获批筹建，首条民营控股高铁开通运营，民营资本被允许进入油气勘探开发领域，民营公司创下火箭海上发射、液氧甲烷火箭重复使用的成功纪录。2012年至2023年，民营企业数量翻了两番多，在企业总量中的占比由约79%提高到逾92%。

　　习近平还对国企大刀阔斧改革。2017年，中国联通作为首家面向民营资本开放的通信行业央企，在“混改”中引入包括腾讯、百度、京东、阿里等互联网企业在内的14家战略投资者，业内评价这是“全球电信行业发展140年以来，首次出现‘电信运营商+互联网’的资本与业务创新模式”。

　　随后习近平实施了国企改革三年行动方案。国有企业全面完成公司制改制，3.8万户国企实现董事会应建尽建，任期制、契约化管理覆盖逾8万户企业。

　　在新的形势下，中国各项改革与时俱进。外媒观察到，2018年美国发动对华贸易战，叠加3年新冠疫情以及地缘政治变化，使得中国经济韧性受到考验。在这一时期，中国经济发展模式也进行着新的调整。

　　习近平带领中国加快构建以国内大循环为主体、国内国际双循环相互促进的新发展格局，以应对形势变化。这项战略的重要支撑是建设全国统一大市场。为此要进行消除地方保护主义、拆除区域壁垒的一系列改革。

　　李君如说，习近平推动区域协调发展改革，在神州大地上“画”出新的“带”、“圈”、“点”，升级了中国行政区划版图。他决策、部署、推动被称为“千年大计”的雄安新区建设，推进前海这个“特区中的特区”的发展，鼓励京津冀、长江三角洲、粤港澳大湾区、成渝地区、东北和中部地区凝聚经济和社会发展合力。

　　他引领的“以开放促改革”的力度也越来越大，特别是倡导“制度型开放”。中国已取消证券公司、证券投资基金管理公司、期货公司、寿险公司外资股比限制。江苏、北京等地推出了鼓励外资参与重点产业集群建设、吸引优质外资参与产业强链补链延链，以及便利外资跨境数据流动等措施。

　　中国还积极寻求加入《全面与进步跨太平洋伙伴关系协定》。这意味着中国将通过持续深化改革，努力全面达到该协定的规则标准，并在市场准入领域作出超过中方现有缔约实践的高水平开放承诺。

　　2013年，习近平指示在上海建立了中国第一个自贸试验区，现在数量已经达到22个，海南岛整体成为自贸港。习近平主导的另一项改革是，设立世界上第一个以进口为主题的国家级展会——上海进博会，他还谋划了服贸会、消博会，来展现他对贸易自由化和经济全球化的构想。

　　目前，中国是140多个国家和地区的主要贸易伙伴，并稳居外商直接投资第二大目的地。

　　同时习近平致力于防范类似美国次贷危机的情况在中国发生，并警惕一些领域出现的资本无序扩张、肆意操纵、牟取暴利现象，称其损害了人民利益，提出要为资本设置“红绿灯”，“既不让‘资本大鳄’恣意妄为，又要发挥资本作为生产要素的功能”。

　　舆论认为，这反映了中国的改革不再以增长为唯一目的，而是考虑更多优先平衡项。习近平领导全面深化改革的显著特点是协调发展与安全的关系。中国成功应对了重大风险挑战，是40多年来全球大国中唯一没有发生金融危机的经济体。

“为了人民而改革，改革才有意义”

　　习近平认定改革出发点和落脚点是为了人民，“为了人民而改革，改革才有意义；依靠人民而改革，改革才有动力。”这完全不同于西方奉行的“资本至上”。

　　他在2017年指出，中国在改革开放近40年后，社会主要矛盾已经发生重大变化，是人民日益增长的美好生活需要和不平衡不充分的发展之间的矛盾。为此，他推动协调发展，倡导共享理念，致力于实现邓小平提出的“共同富裕”。

　　习近平就任总书记时，东西部的差距很大，贫富不均严重。他通过实地考察访真贫摸实情，果断改革扶贫策略，实施“精准脱贫”，打出从建档立卡到易地搬迁、从产业对接到教育扶贫等的“组合拳”，派出300多万名干部常驻贫困村定点扶贫，最终消除了延续几千年的农村绝对贫困。

　　中国改革始于农村，习近平倡导的“三农”改革更为全面——从建立“饭碗牢牢端在自己手中”的粮食稳产机制，到改革农村经营体制和推进乡村全面振兴。

　　习近平在世纪之初撰写的博士论文《中国农村市场化研究》中提出：“大胆进行户籍制度改革，坚决剔除粘附在户籍关系上的种种社会经济差别，彻底消除由户籍制度造成的城乡劳动力市场的分割。”而在当时，对于要不要取消户籍限制，各方面争议很大。

　　习近平就任总书记后，中央政府出台“推动1亿非户籍人口在城市落户”的方案，并在不到5年时间里提前实现。2023年，习近平到上海考察时，特意去探访外地打工者所住的公寓。听到山东打工者说要把配偶小孩接过来租房、安徽打工者说要找对象在上海安家，他高兴地说：“好啊！扎根，落户，发展。”

　　在习近平执政期间，中国终结了延续半个多世纪的劳教制度，将个税起征点从每月3500元提高到5000元，实行“房子是用来住的、不是用来炒的”政策以缓解百姓住房困难，根据人口发展形势相继实施单独两孩、全面两孩和三孩政策，使基本养老保险覆盖超10亿人、基本医疗保险覆盖逾13亿人。

　　习近平认为“现代化最重要的指标还是人民健康”。他要求总结推广福建三明市的医改经验，破解医疗改革这一世界性难题。他推动全面取消实行60多年的药品和耗材加成，破除“以药补医”，减少患者看病费用。习近平主持的一次深改委会议通过了药品集中采购试点方案，有关部门还据此组建“国家队”出面与医药企业谈判药品和医用耗材价格。

　　2021年火遍网络的一次“灵魂砍价”中，在国家医保局谈判代表“每一个小群体都不应该被放弃”的坚持下，一种罕见病的“天价救命药”经过8轮激烈谈判，从每针70万元降至3.3万元，进入新版医保目录，让全国3万多名患者看到希望。类似的降价药品达几百种，几年间累计减轻群众看病就医负担约5000亿元。

　　习近平推动文化体制改革，把丰富人民的“精神世界”作为中国式现代化的内在要求。为此中国不断完善文化产业规划和政策，培育新型文化业态和文化消费模式。仅以电影产业来看，全国银幕数量从2012年的1.3万块增长到去年底的8.6万多块，居世界第一。《纽约时报》今年初的报道说，中国电影产业正在制作更多引起国内观众共鸣的优质影片。

　　教育体制改革是“习式改革”的重点，这直接关系到“出人才”和“强科技”。他推动义务教育均衡发展、促进素质教育、减轻中小学生课业负担、构建现代职业教育体系、建设现代大学制度等。国家财政性教育经费投入占GDP的比例连年保持在4%以上，教育成为财政一般公共预算的第一大支出。

　　另一项突破性改革是在生态领域。10多年前，环境污染是百姓抱怨最多的问题之一。2012年初广西河池市境内的龙江河发生镉污染，影响到上百万人的饮水安全。这年，四川什邡、江苏启东、浙江镇海等地发生民众因担心环境被破坏而反对工业项目上马的群体事件。

　　在厦门以治理筼筜湖、在杭州以保护西湖闻名的习近平，组建生态环境部，将生态环境保护设置为不能逾越的“红线”，对地方政府考核实行环境保护“一票否决制”，建立中央生态环保督察制度，指示各地任命“河长”、“湖长”和“林长”。

　　习近平执政期间，中国成为全球空气质量改善最快、森林资源增长最多和人工造林面积最大的国家。中国的水电、风电、太阳能发电、生物质发电装机稳居世界第一。作为其发起的“能源革命”成果之一，他领导建成全球规模最大碳市场，并向世界承诺中国将用远远短于发达国家所用时间实现从碳达峰到碳中和。“绿色低碳发展，这是潮流趋势，顺之者昌。”他说。

　　习近平认为，纠正不可持续的增长方式，是为了中华民族永续发展，也是要保护人类的家园，因为地球是唯一的。

“持续探索，勇往直前”

　　新加坡《联合早报》评价说：“环顾世界，没有任何一个国家能够像当今中国这样，以一种说到做到、只争朝夕的方式全面推进改革进程。”

　　世界知名咨询公司爱德曼的2023年信任度调查报告显示，中国整体信任度达83，在所有被调查国家中排名第一；同时，中国是所有受访国家中唯一对经济前景更加乐观的国家。

　　美国智库印度、中国及美国研究所学者丹·施泰因博克评论：“在习近平领导下，中国以世界级的创新和繁荣的消费实现了再平衡。”

　　观察人士认为，习近平作为新时代改革设计者、实践者和引领者，让邓小平开创的社会主义市场经济得以延续并不断书写新篇章，点燃了中国这艘巨轮加速驶向全面现代化的新引擎，使中华民族复兴进入不可逆转的历史进程。

　　这无疑是人类历史上影响最大的改革之一。上世纪90年代初，邓小平提出“发展才是硬道理”解放和发展了中国的社会生产力，增强了中国的综合国力，使世界经济增长有了无可替代的推进器和压舱石。

　　习近平把坚持高质量发展作为新时代的硬道理并以此在中国开启了一场全方位、系统性的变革，推动新型经济全球化。他提出构建创新、活力、联动、包容的世界经济，为推动构建人类命运共同体注入强大动能。

　　去年中国经济以5.2%的增速，贡献了全球三分之一的增长。中国发动机仍然强劲。

　　习近平今年5月访问“一带一路”共建国家塞尔维亚时，来到斯梅戴雷沃钢厂，他带去天坛和圣萨瓦教堂造型的钢制工艺品作为礼物，而钢材就来自这家钢厂。2016年，习近平访塞时就曾来到这里，并亲自关心、促成了合作项目。钢厂在中资企业投资后扭亏为盈，5000多名职工的工作岗位得到保障。

　　习近平提出的共建“一带一路”倡议是中国改革发展惠及世界的一个范例，它通过互联互通来促进各国经济增长、摆脱贫困。目前，已有150多个国家、30多个国际组织加入这个倡议。

　　中国的未来更为人关注。“如果继续改革和开拓新道路，中国就更有可能成功。”《南华早报》的报道说。

　　谈到未来的改革，习近平说，要“推出一批战略性、创造性、引领性改革”，“在重要领域和关键环节取得新突破”。

　　舆论对习近平领导的改革前景表示乐观——不仅因为中国有巨大的经济和市场体量、充足的增长空间和潜力，更在于它有具备坚强核心的执政党的统一领导，而且执政党有自我革命的决心和纠错能力，有把长远规划落实的行动力。

　　不少“全球南方”的人士认为，中国改革的成功为他们的现代化提供了借鉴和选择。巴西精英企业家协会中国区首席执行官多斯桑多斯说，中国提供了一种以人民为中心的新理念，摆脱了传统经济增长方式，可为地区未来发展提供更多思路。

　　针对海外一些对中国改革目标与意图的误读或担忧，习近平时常对外国朋友说，中国无意改变和挑战已有的世界秩序。同时中国也以更为积极的姿态参与和影响全球治理，在国际事务中始终主持公道正义。

　　通过全面深化改革，习近平继承发扬了邓小平的事业，让中国不仅续写了经济奇迹，还展现出文化魅力，创造了人类文明新形态。

　　中国的现代化既是最难的，也是最伟大的。习近平说，“这是一条前无古人的道路，但是我们会持续探索，勇往直前。”（记者周效政、张正富、程云杰、吴济海、许林贵、王秀琼、张钟凯、王亚光、石昊、张博文、付敏）（完）

With a series of key documents and initiatives approved in this meeting, the CCCDR has charted a course towards creating new structures for a high-level open economy, a strategic step in fostering reform and development. Moreover, plans to strengthen the nation's agricultural sector, enhance oil and gas security, and steer China's transition towards an ecological civilization take center stage.

In the meeting, Xi emphasized the significance of the new open economic system as a catalyst for reform. He stressed a novel development paradigm with a focus on institutional opening, refining supporting policies, and taking proactive measures to elevate China's international engagement to the next level. The broadening of the new economic structure will facilitate market access, create a conducive business environment, and leverage China's holistic strengths to garner global resources.

Highlights:

• Agricultural Modernization: A key highlight of the meeting was the strategy for modernizing agriculture and rural areas. With the strategic goal of agricultural and rural modernization, China seeks to manage the relationship between farmers and land more effectively.

• Energy Policies: One of the critical topics discussed at the meeting was the transition from controlling the total energy consumption to controlling carbon emissions. As China steps into a decisive phase in building an ecological civilization, this new strategy is expected to increase the country's energy consumption efficiency while reducing carbon dioxide emissions intensity.

• Remuneration Reform in Higher Education: The meeting also touched upon a significant reform in the higher education sector - remuneration system reform. The commission emphasized the need to foster a remuneration system that stimulates innovation, values knowledge, and drives creativity within higher education institutions and research institutes.

• Securing Energy Supply: In terms of energy security, the reform of the oil and gas market system will focus on increasing capacity for ensuring oil and gas supply, while intensifying market supervision and regulation, and promoting fair competition.

• Power System Revolution: The meeting stressed the importance of building a clean, low-carbon, safe, and efficient power industry. The strategy involves reducing the proportion of traditional energy resources, promoting technological and business model innovation, and improving policies to secure the supply of basic public power services.

A full-text official readout from Xinhua is provided below in case some of you might want to dive deep into it.

THE OFFICIAL READOUT

Chinese President Xi Jinping on Tuesday presided over the second meeting of the Central Commission for Comprehensively Deepening Reform (CCCDR). A series of documents were examined and approved at the meeting. They include Opinions on Establishing New Systems for a Higher-level Open Economy to Build a New Development Paradigm, Implementation Plans on Deepening Rural Reform, Opinions on Promoting the Gradual Transition from Control of Total Amount and Intensity of Energy Consumption to Control of Total Amount and Intensity of Carbon Emissions, Opinions on Pilot Reform of Remuneration System in Higher Education Institutions and Research Institutes, Opinions on Deepening Reform of the Oil and Gas Market System and Strengthening the Capacity for National Oil and Gas Security, and Guiding Opinions on Deepening Power System Reform and Accelerating the Building of a New Power Industry.

Xi, also general secretary of the Communist Party of China (CPC) Central Committee, chairman of the Central Military Commission, and director of the CCCDR, stressed that establishing new systems for a higher-level open economy is a strategic measure to promote reform and development through opening up. Centering around fostering a new development pattern, institutional opening up should be the focus when it comes to further reform of systems and mechanisms in such key areas for international exchange and opening up as investment, trade, finance, and innovation, so as to improve supporting policies and measures, and proactively elevate the country's opening up to a higher level. With the strategic goal of realizing agricultural and rural modernization as well as building strong agriculture as the linchpin, the country should well manage the relationship between farmers and land, and speed up efforts to bolster the weak links in agricultural and rural development to lay a solid foundation for comprehensively building a modern socialist country. Since the country's building of an ecological civilization has entered a critical period with carbon reduction as a key strategic task, it is imperative to improve the control of total energy consumption and intensity, so as to gradually shift to a system for controlling both the total amount and intensity of carbon emissions. It is important to advance the reform of remuneration system for university teachers and research personnel as a pivot for boosting the development of education, science and technology, and talent. Such reformed remuneration system should invigorate innovation, orient education to knowledge value, feature standardized and effective management, and give equal weight to basics and incentives, so as to further spur the innovativeness and creativity of higher education institutions as well as research institutes. It is essential to focus on boosting the capacity to ensure oil and gas security and target prominent problems when promoting the reform of the upstream, midstream and downstream systems and mechanisms in the oil and gas industry, in a bid to ensure a stable and safe oil and gas supply. Besides, it is imperative to deepen electric power system reform by accelerating the building of a power industry that is clean, low-carbon, safe and providing abundant supply, economical and efficient, well-coordinated between supply and demand, and flexible and intelligent, so as to better promote the revolution in China's energy production and consumption, ensuring national energy security.

Li Qiang, Wang Huning and Cai Qi, members of the Standing Committee of the CPC Central Committee Political Bureau and deputy directors of the CCCDR, attended the meeting.

It was pointed out at the meeting that China's development is facing a complex and severe international situation. We should improve the top-level design of new systems for an open economy, deepen the reform of the system and mechanism in the field of trade and investment, expand market access, comprehensively optimize the business environment, improve the service guarantee system, give full play to China's comprehensive strengths, and attract global resources with the flow of domestic economy, so as to improve the quality and level of trade and investment cooperation. We must be prepared to deal with worst-case and extreme-case scenarios to promptly improve national security systems and mechanisms, and strive to promote the capacity and level of supervision and management over and of opening up. It is imperative to dovetail the building of new systems for a higher-level open economy with national strategies such as high-quality Belt and Road cooperation, actively participating in the reform and development of the global governance system.

It was emphasized at the meeting that to implement the arrangements of the 20th CPC National Congress for deepening rural reform, work must be done to consolidate and improve the basic system for rural operations, optimize the food security system, refine the system for comprehensively promoting rural revitalization, better the policies for integrated urban-rural development, and accelerate reform in important areas and key links for breakthroughs and effective results, letting the farmers have a stronger sense of fulfillment in the reform. It is necessary to combine top-level policy design with grassroots exploration, and allow and encourage different regions to explore according to local conditions. We should grow adept at discovering and summarizing grassroots practice and innovation, and give timely support to those having difficulties in exploration and innovation.

It was noted at the meeting that since the 18th CPC National Congress, we have given high priority to green and low-carbon development, energy conservation and emissions reduction, and established and implemented the system for controlling both the total amount and intensity of energy consumption. As a result, our country's energy consumption efficiency has greatly increased while the intensity of carbon dioxide emissions has considerably decreased. To transit from controlling the total amount and intensity of energy consumption to controlling those of carbon emissions, it's imperative to stick to the principle of building the new before discarding the old, refine the system for controlling the intensity and total amount of energy consumption, optimize and improve the methods of doing so, strengthen the basic capacity of controlling the intensity and total amount of carbon emissions, and improve all the relevant mechanisms in this regard, so as to create favorable conditions for establishing and implementing the system for controlling both the total amount and intensity of carbon emissions. We must remain committed to prioritizing resource conservation and do a good job in this regard at a higher level with higher quality, so as to get maximum returns at minimum cost. It is imperative to do our work in a stable manner, coordinate the relationship between development and emissions reduction, be realistic, do everything within our capacity and soundly adjust and improve the policies and measures.

It was stressed at the meeting that the pilot reform of remuneration system should be launched in higher education institutions and research institutes with the aim to improve and regulate the distribution system according to the need and reality of salary management. The income distribution policy should be talent-oriented, performance-based with the focus on innovation. Salary distribution should be favorable to the teachers and researchers who have made a significant contribution to urgent and arduous tasks, to the personnel who are engaged in teaching and research of basic disciplines and those who have made great breakthroughs in core technologies in key fields. Efforts should also be made to strengthen the supervision over salary management, so as to ensure that the national fund will be channeled to motivating the talented people and to the development of undertakings in need.

It was noted at the meeting that further efforts should be made to deepen the reform of oil and gas market system and strengthen the systems for energy production, supply, storage, and marketing. It is important to intensify market supervision and regulation, strengthen subsector and cross-sector oversight. It is imperative to standardize the oil and gas market in order to promote fair competition. It is essential to further the reform of the oil and gas reserve system so that it can play a better role in dealing with emergencies and necessary adjustment.

It was stressed at the meeting that we should build a new electric power industry in a professional and science-based manner, gradually reduce the proportion of traditional energy resources in the overall energy mix in a well-planned and phased way when new energy is safe and reliable as an alternative. It is imperative to improve the systems and mechanisms which can adapt to the new electric power industry and strengthen innovation in power technologies, market mechanisms, and business models. It is essential to promote better links between an efficient market and a well-functioning government, and continue to improve policies in order to secure the supply of basic public power services.

Members of the CCCDR were present. Leading officials of relevant central Party and government departments sat in on the meeting.

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