The communique for the Fifth Plenum is out, there were no big surprises. There is a lot of focus on self-reliance, especially in technology, as well as security and military modernization, and of course opening and dual circulation. The US is not mentioned but risks and opportunities from the New Era of US-China relations are clear in the text. And by “New Era” I mean a belief that US-China relations are accelerating towards increasingly difficult competition if not outright conflict, no matter who wins the US election next week.
It is an aspirational document which is full of confidence while clear about the risks and challenges. The Plenum communique says that China is still in a period of important strategic opportunity, as the world is “undergoing changes unseen in a century”.
There will be a press conference Friday morning and we should expect much more detail to come out over the next several weeks and months.
The Communique lists 12 areas of focus. According to the document, the Plenum proposed:
- to adhere to the central position of innovation in the overall situation of China’s modernization and construction, scientific and technological self-reliance and self-improvement as a strategic support for national development, facing the world science and technology frontier, facing the main economic battlefield, facing the major national needs, facing people’s lives and health, in-depth implementation of science and education to invigorate the country strategy, talent strategy, innovation-driven development strategy, improve the national innovation system, accelerate the construction of scientific and technological power 全会提出，坚持创新在我国现代化建设全局中的核心地位，把科技自立自强作为国家发展的战略支撑，面向世界科技前沿、面向经济主战场、面向国家重大需求、面向人民生命健康，深入实施科教兴国战略、人才强国战略、创新驱动发展战略，完善国家创新体系，加快建设科技强国;
- to speed up the development of the modern industrial system and promote the optimization and upgrading of the economic system 加快发展现代产业体系，推动经济体系优化升级;
- to form a strong domestic market and build a new development pattern. 全会提出，形成强大国内市场，构建新发展格局;
- to comprehensively deepen reform and build a high-level socialist market economic system. 全面深化改革，构建高水平社会主义市场经济体制;
- that priority be given to agricultural and rural development, and rural revitalization be comprehensively promoted. 优先发展农业农村，全面推进乡村振兴;
- optimizing the spatial layout of the country and land, promoting coordinated regional development and new-type urbanization. 优化国土空间布局，推进区域协调发展和新型城镇化;
- to flourish and develop cultural undertakings and cultural industries, and improve the country’s cultural soft power. 繁荣发展文化事业和文化产业，提高国家文化软实力;
- to promote green development and the harmonious coexistence of man and nature. 推动绿色发展，促进人与自然和谐共生;
- that a high level of opening up to the outside world should be carried out to open up a new situation for win-win cooperation. 实行高水平对外开放，开拓合作共赢新局面
- to improve people’s quality of life and raise the level of social construction. 改善人民生活品质，提高社会建设水平
- to integrate development and security and build a higher level of peace and safety in China 统筹发展和安全，建设更高水平的平安中国
- accelerating the modernization of national defense and the army to realize the unity of a rich country and a strong army 加快国防和军队现代化，实现富国和强军相统一
There were no announced personnel moves or new titles for Xi.
The Four Comprehensives has changed now that China has effectively achieved the goal of comprehensively building a moderately prosperous society. The goal has been replaced with “全面建设社会主义现代化国家 comprehensively build a modern Socialist country”. The other three-deepening reform, governing the nation according to law, and strictly governing the Party—remain the same.
Near the end of the communique are paragraphs on security and the military. They are hardening the country and the PLA:
The Plenary Session proposed to integrate development and security and build a higher level of peace and safety in China. We will adhere to the overall national security concept, implement the national security strategy, maintain and shape national security, co-ordinate traditional and non-traditional security, carry out security development throughout all areas and processes of national development, prevent and defuse various risks affecting China’s modernization process, and build a solid national security barrier. We will strengthen the national security system and capacity building, ensure the country’s economic security, safeguard people’s lives, and maintain social stability and security.
The Plenum proposed accelerating the modernization of national defense and the army to realize the unity of a rich country and a strong army. Carry out Xi Jinping’s thought on the strengthening of the army, implement the new era of military strategic guidelines, adhere to the Party’s absolute leadership of the people’s army, adhere to the political army, reform and strengthen the army, science and technology, talent and rule by law, accelerate the development of mechanization and informatization of intelligent integration, comprehensively strengthen military training and preparation for war, improve the strategic ability to defend national sovereignty, security and development interests, and ensure that in 2027 achieving the centennial goal of building the army. It is necessary to improve the quality and efficiency of national defense and military modernization, promote the simultaneous enhancement of national defense strength and economic strength, build an integrated national strategic system and capabilities, promote the coordinated development of key regions, key fields and emerging areas, optimize the layout of the national defense science and technology industry, and consolidate military, political, military and civilian unity.
I have posted a rough translation done with DeepL to a shared Google doc. Comments/edits welcome.
1. Official reports on the Plenum
The communique – 中国共产党第十九届中央委员会第五次全体会议公报–时政–人民网
The Plenary unanimously agreed that, in the face of the complicated international situation, the arduous and onerous task of domestic reform, development and stability, and especially the serious impact of the new coronary pneumonia epidemic, the Party Central Committee, with Comrade Xi Jinping at its core, has never forgotten its original intention and kept its mission in mind, united and led the whole Party and all ethnic groups of the people to forge ahead, blaze new trails, vigorously promote the various undertakings of the Party and the State, overcome various risks and challenges, and the ship of socialism with Chinese characteristics continues to sail. We will brave the wind and waves and march forward with perseverance. Practice has proved once again that with Comrade Xi Jinping at the helm as the core of the Central Committee and the entire Party, and with the unity and tenacity of the entire Party and people of all ethnic groups, we will surely overcome all kinds of difficulties and hindrances on the road ahead and push forward socialism with Chinese characteristics even more vigorously in the new era.
The plenum made an in-depth analysis of the profound and complex changes facing China’s development environment and concluded that China’s development is still in a period of important strategic opportunities at present and in the coming period, but there are new developments in both opportunities and challenges. The world today is undergoing major changes unseen in a century, a new round of scientific and technological revolution and industrial transformation is undergoing in-depth development, the international power balance is undergoing profound adjustment, peace and development remain the theme of the times, and the concept of a community of human destiny is deeply rooted in people’s hearts, while the international environment is becoming increasingly complex and instability and uncertainty are obviously increasing. China has shifted to a stage of high-quality development, with significant institutional advantages, improved governance, long-term economic growth, a strong material foundation, abundant human resources, broad market space, strong development resilience, stable social conditions, and multiple advantages and conditions for continued development; at the same time, the problem of unbalanced and inadequate development remains prominent in China, the task of reform in key areas and key links remains arduous, and the capacity for innovation is not adapted to high-quality development. Development requirements, the agricultural foundation is not yet solid, the gap between urban and rural areas in terms of regional development and income distribution is wide, ecological protection has a long way to go, there are shortcomings in people’s livelihood security, and there are weaknesses in social governance. The whole Party should co-ordinate the overall strategic situation of the great rejuvenation of the Chinese nation and the great changes that the world has not seen in a century, deeply understand the new features and new requirements brought about by changes in the main contradictions in China’s society, deeply understand the new contradictions and new challenges brought about by the complicated international environment, enhance the awareness of opportunities and risks, base itself on the basic conditions of the primary stage of socialism, maintain strategic stability, do its own business, understand and grasp the law of development, and carry forward the development of the country, carry forward the spirit of struggle, establish a bottom line thinking, accurately recognize changes, respond scientifically, actively seek changes, be good at nurturing opportunities in crises, opening new situations in changes, seizing opportunities, responding to challenges, seeking advantages and avoiding disadvantages, and moving forward courageously.
Thursday CCTV Evening News read the entire communique while showing video from the meeting, took up the first 30 minutes of the broadcast.
— China’s economic and technological strength, and composite national strength will increase significantly. A new stride will be made in the growth of the economy and the per capita income of urban and rural residents. Making major breakthroughs in core technologies in key areas, China will become a global leader in innovation;
— New industrialization, IT application, urbanization, and agricultural modernization will be basically achieved. China will finish building a modernized economy;
— The modernization of China’s system and capacity for governance will be basically achieved. The people’s rights to participate and to develop as equals will be adequately protected. The rule of law for the country, the government, and society will be basically in place;
— China will become a strong country in culture, education, talent, sports and health. The well-rounded development of all people and social etiquette and civility will be significantly enhanced. China’s cultural soft power will grow much stronger;
— Eco-friendly ways of work and life will be advanced to cover all areas of society. Carbon emission will steadily decline after reaching a peak, and there will be a fundamental improvement in the environment with the goal of building a Beautiful China basically reached;
— The opening-up will reach a new stage with substantial growth of the country’s strengths for participating in international economic cooperation and competition;
— The per capita GDP will reach the level of moderately developed countries. The size of the middle-income group will be significantly expanded. Equitable access to basic public services will be ensured. Disparities in urban-rural development, in development between regions, and in living standards will be significantly reduced;
— The implementation of the Peaceful China initiative will be promoted to a higher level. The modernization of national defense and the military will be basically achieved;
— People will lead a better life, and more notable and substantial progress will be achieved in promoting well-rounded human development and achieving common prosperity for everyone.
China will further upgrade the protection of its national security by incorporating “security and development” in all aspects and process of the country’s development, and accelerate the modernization of its military to build a prosperous country and a strong military in the coming years…
The initiative to safeguard China’s security stressed in the communiqué should cover all spheres of security including protecting the personal safety of the Chinese people, and safeguarding the political, economic, military security, social order and public health, Guo Xiaobing, director of the Arms Control Studies Center of the China Institutes of Contemporary International Relations, told the Global Times on Thursday.
With mounting internal and external security challenges, “China will also need to strengthen its capability to safeguard the security of its nationals overseas,” Guo said.
The plenary session also agreed that China needs to accelerate the modernization of national defense and the military and called for integrated efforts to build a prosperous country and a strong military.
The communiqué said the country should “speed up the integrative development to cover military mechanization, informatization and intellectualization, and comprehensively strengthen military training and preparation for war.”
The communiqué also said the country’s national defense capabilities and economic strength should be strengthened at the same time and the country should improve the overall arrangement of national defense sci-tech industry, and reinforce military-government and military-civilians unity.
“China is facing increasing external uncertainties,” Guo said. “The escalating China-US tensions are a serious challenge to our security, as the US continues to provoke us economically, technologically and militarily.”
The plenum analyzed the profound and complex changes in China’s development environment. It concluded that the world is undergoing major changes unseen in a century. A new round of scientific and technological revolution and industrial transformation is being evolved and developed.
The balance of international forces has adjusted, but peace and development are still the themes of the times. The concept of a community with a shared future for mankind is deeply rooted in the hearts of the people, but the uncertainties in international community have increased significantly…
“The comprehensive analysis on current changes, advantages and challenges shows that the country is increasing its awareness of problems, Yang Xuedong, a professor of political science at Tsinghua University, told the Global Times on Thursday.
“As the world faces the COVID-19 pandemic, with no end in sight in the next few years, coping with the increasingly complex and vicious international environment where some countries have been dedicated to containing China’s rise, it is of great importance to cultivate such awareness to embrace instability and uncertainties and grasp new opportunities,” Yang said…
Lin Liming, a research fellow at the China Institutes of Contemporary International Relations in Beijing, pointed out that “the experiences in curbing COVID-19 have shown the international community its institutional advantages, especially in the public health sector. It also helps to boost the Chinese people’s confidence.
Lin predicted that it may help China catch up with the US in terms of GDP earlier than the previously expected 2027.
Under the goals in the communiqué, China will achieve modern socialism by 2035. What that entails includes achieving “big leaps” in economic strength, technological prowess as well as overall national strength, the document said. Total economic output and urban and rural income will reach a “new level,” and major breakthroughs would be made in core technologies.
“I think those targets are very pragmatic as they reflect our advantages and long-term development goals, as well as the many challenges we have to face,” Tian Yun, vice director of the Beijing Economic Operation Association, told the Global Times on Thursday.
Though the document refrained from offering specific empirical targets, Tian said that those goals could mean that China would double its current GDP of around 100 trillion yuan in 2035, and double current per capita GDP of $10,000. “That would require a real GDP growth of around 3.5 percent annually; it is a big target but can be done if China’s full potential is realized,” he said.
The fifth plenary session of the 19th CPC Central Committee is leading the country forward. China has the capital and ability to do so. In this turbulent world, the meeting has provided a practical and significant guide for our direction, goal and tactics. Despite the many problems, China’s political philosophy can constantly generate positive energy to solve the problems, instead of letting the problems crush positive energy.
At the moment, China is facing the most problems and challenges. However, the country is also the most confident now. Other countries have posed many difficulties, but they provide reference and proof that we are doing better. As the world suffers from shrinking demand and negative growth, we are demanding real and comprehensive growth to realize new achievements in six areas. The country is self-driven.
Friday October 30 People’s Daily Editorial on the Plenum – “Strive for a new victory in building a modern socialist country on all fronts.” – 人民日报社论：奋力夺取全面建设社会主义现代化国家新胜利-新华网
At present and in the future, our country’s development is still in a period of important strategic opportunity, but there are new developments and changes in opportunities and challenges. The “14th Five-Year Plan” period is the first five years after my country has built a moderately prosperous society in an all-round way and achieved its first centenary goal, and took advantage of the momentum to embark on a new journey of building a socialist modern country in an all-round way and march towards the second centenary goal.
The 19th National Congress of the Communist Party of China made a two-stage strategic arrangement for achieving the second centenary goal, that is, by 2035, basically achieving socialist modernization, and building our country into a prosperous, strong, democratic, civilized, harmonious and beautiful modern socialist country by the middle of this century. This plenary meeting anchors the long-term goal of 2035, comprehensively considers domestic and foreign development trends and our country’s development conditions in the future, and makes systematic plans and strategic deployments for my country’s development during the “14th Five-Year Plan”
The longer version of Xi’s banner term does appear, but just twice in the text. And in both of these instances the lengthy phrase appears in the context of standardized introductions of the banner terms of past CCP leaders (think of it as the fossil record of CCP legacies)…
The shortened phrase “Xi Jinping Thought” does not appear at all in the bulletin. However, there is one stepping stone phrase in the arena of national security, the text emphasizing the need to “carry out Xi Jinping Thought on Military Strengthening” (习近平强军思想), which also mentions the need to “uphold the party’s absolute leadership over the people’s army.”
We cannot of course definitively read the internal environment in the CCP from its discourse, but the absence of Xi’s coveted “thought” seems to indicate that the work of consolidating his strength and preparing his legacy is ongoing.
This Wechat account notes the this is the second Five Year Plan Plenum Communique to use the term 备战 (prepare for war). The author says it was last used in relation to a Five year Plan in the 3rd plan for the period 1966-1970. 上世纪60年代中期，中央要求在”三五”计划期间，也就是1966年-1970年必须立足于战争，从准备大打、早打出发，积极备战，把国防建设放在第一位，加快三线建设，逐步改变工业布局。
Among the development goals, the communique said, is the construction of a fully modern army by 2027, which marks the centennial of the founding of the PLA. Hong Kong military analyst Song Zhongping said the new centennial goal can be interpreted as “putting the PLA as a leading modern force in the world, one that can be on par with the US army”…
Junfei Wu, deputy head of Hong Kong think tank Tianda Institute said this is the first time the Chinese leaders have included the military in such development goals. He said the goal was primarily targeted at Taiwan.
“Basically, the target is to build PLA’s capability to match the US army by 2027, so It can effectively deter interference by the US army around the Taiwan Strait.
“The leadership still expects the size of the economy, household income as well as GDP per capita to reach a ‘new milestone’ by 2035,” said Raymond Yeung, chief greater China economist at Australia and New Zealand Banking Group. “China did not abandon GDP targeting, it’s just expressed in a more subtle way.”
Comment: I would not assume there will not be a GDP target by the time the full plan is released
The leadership also unveiled some longer-term targets for China’s economic development. It pledged to pull the country’s per capita output levels up to that of “moderately developed countries” by 2035. That would mean per capita gross domestic product of about $30,000 a year—somewhere around the levels of South Korea and Spain. Last year, the figure for China was $10,262, according to the World Bank.
Former paramount leader Deng Xiaoping had aimed for realization of the per capita target by 2050. By moving up the timetable, Mr. Xi is trying to project more confidence in an increasingly state-led model under his leadership.
With Mr. Xi’s position secure, a dramatic shift in Chinese policy seems unlikely. He is expected to push for another five-year term as the Communist Party’s leader, beginning in 2022, meaning his highly personalized rule could last another decade or more.
By then, he would have ruled longer than any other Chinese leader except Mao Zedong. Mao was also praised as the “great helmsman,” though in referring to Mr. Xi on Thursday, the committee used different characters for the term helmsman…
“The dominant tone is that China has major opportunities for growth, for managing the process of decoupling in its own favor, and for setting the terms for the next stage of globalization,” said Julian B. Gewirtz, a senior fellow for China studies at the Council on Foreign Relations in New York. “This is really an extraordinary tone to hear at a moment where it is not just the United States that is continuing to struggle with the pandemic.”
Almost exactly ten years ago, in a typically roundabout way, China made clear who its next leader would be. A man who, not long earlier, had been far less famous than his folk-singer wife was made vice-chairman of the Communist Party’s Central Military Commission. Sure enough, two years later, he took charge of the party and the armed forces and became China’s most powerful ruler since Mao Zedong. Were precedent to be followed, a meeting of senior officials in Beijing this week would have provided just such a clue about who would succeed Xi Jinping. It provided nothing of the sort.
- The summary reiterated the increasingly challenging environment for development and rising uncertainties in external conditions, and highlighted major problems at the current phase of development, including development still unbalanced and insufficient, the lack of innovation, still substantial income inequality, and further room for improvement in environment protection.
- In contrast to the 13th Five-Year Plan where a “doubling income” goal was emphasized, the summary of the 14th Five-Year Plan today didn’t mention any specific numerical goal, and re-emphasized the direction towards “higher quality growth.” Regarding key economic goals for the 14th Five-Year Plan, the proposals particularly highlighted the importance of innovation and a push for market reform, facilitation of internal circulation through expanding domestic demand strategy and supply-side structural reform, significant improvement in household income and narrower income inequality in urban and rural areas, and “high-quality opening up” (trade and financial liberalization). The summary also mentioned long-term goals through 2035, for instance, GDP per capita reaching the level of middle-income developed economies and expansion in middle-income population.
- The key elements highlighted in the summary are not new and have been mentioned previously by policymakers. From an economic perspective, this means boosting total factor productivity and rebalancing economic development across sectors/regions. Although the Chinese government has been calling for a transition in the development model for a number of years, given that the broad external and domestic environment has changed, we think the government is likely to accelerate the pace of relevant reforms in the next five years, to achieve sustainable, balanced and high quality growth and enter the high income group from the upper middle income group.
- Over the coming months, the National Development and Reform Committee (NDRC) will consult specialists and other government ministries to prepare a more detailed draft of the 14th Five Year Plan. It will be submitted to the National People’s Congress (NPC) for final approval during the “Two Sessions” in March 2021, which would be the next key event to watch out for. Detailed plans on a sectoral level from ministries will likely be released several months after the “Two Sessions”.
Prima facie, such a plan could result in better but far less commodity-intensive growth. But China has been saying that since Xi came to power and it has doubled the number of empty apartments that it is building over the same time:
Much more likely is we see more of the same lurching from crisis to crisis requiring ever more wasteful stimulus building that slowly but surely sinks growth into the debt bog and, eventually, commodity consumption as well.
China is no better at reform than we are and its future is Japan not the US.