Global experts laud 5-year growth plan

‘Dual circulation’ model offers stable outlook amid pandemic, say analysts

“The ability of the Chinese leaders to set realistic and achievable development agendas is one of the salient features of the Chinese governance model.” AHMED QURAISHI Senior research fellow at Project Pakistan 21

China’s latest development blueprint not only sets the direction of its social and economic development, but also provides a view toward stability to the pandemic-hit world, said analysts and academics after the Communist Party of China Central Committee announced its proposals for the next five years.

“The ability of the Chinese leaders to set realistic and achievable development agendas is one of the salient features of the Chinese governance model,” said Ahmed Quraishi, senior research fellow at Project Pakistan 21, an independent research organization in Islamabad.

Guidelines for the 14th Five-Year Plan ( 2021-25) for economic and social development were included in a communique released on Oct 29 after the four-day Fifth Plenary Session of the 19th Central Committee of the CPC in Beijing.

The goals set by the new plan will result in a very large rise in China’s total GDP as well as its domestic consumer market, said Rajiv Biswas, Asia Pacific chief economist at global consultancy IHS Markit.

“A key long-term goal set out in the 14th Five-Year Plan is the objective of becoming a moderately developed nation within just 15 years, by 2035,” he said.

“This means that China would become a high-income nation, rising beyond its current status as an uppermiddle-income developing country, as defined by World Bank income thresholds for countries worldwide.

“This will reinforce the ‘dual circulation’ strategy by significantly increasing consumption expenditure and making consumer spending an increasingly important contributor to annual GDP growth,” Biswas said.

Suan Teck Kin, executive director and head of research at Singapore’s United Overseas Bank, said the “dual circulation” growth pattern does not overly emphasize developing the domestic economy.

“The point is that you have the domestic part of your equation, and the other part of the equation is the interaction between the domestic and global economy, which is equally important,” he said.

China will continue moving towards modernization, said Suan, who expects to see the country further open up its economy and advance its pursuit of renminbi internationalization.

“The government and the Party are quite clear about this, and I think the direction is a correct one.”

Veronika S. Saraswati, convener of the China Unit at the Centre for Strategic and International Studies, a think tank in Jakarta, referred to the dual circulation model as “a great development strategy” and one that will be “successful”.

She said the 14th Five-Year Plan has set an example for the rest of the world in terms of devising development and economic policies.

“Being able to put a focus on developing the domestic market also means that China has realized its goal of developing a xiaokang (moderately prosperous) society,” Saraswati said. “Without achieving xiaokang, there will not be a strong domestic market (to support dual circulation).”

Noting that China is a key part of the global value chain and an important economic partner for Southeast Asian countries, she said the economic recovery of China in the postpandemic era will have a great impact on regional economies.

Mohammad Ahmed, an assistant professor of economics at Quaid-eAzam University in Islamabad, said the world will benefit from China’s move and stable development as it successfully eliminates its absolute poverty.

Oleg Timofeev, an associate professor at the Peoples’ Friendship University of Russia, said what has been revealed of the 14th Five-Year Plan indicates China’s determination for better self-development.

In a broader context, Timofeev said, the move adheres to innovation, which is a core of China’s modernization, technological self-reliance and the strategy of building a modern scientific and technological power.