Setting the Agenda
The annual Central Economic Work Conference held on December 19-21, 2018, in Beijing summarized China’s economic work in 2018 and mapped out 10 key tasks that will top the country’s economic agenda in 2019.
According to the conference, China will continue to pursue a proactive fiscal policy and a prudent monetary policy, adhere to the general principle of seeking progress while maintaining stability, and deepen market reform. It will also expand high-level opening up, promote high-quality growth and strengthen the protection and improvement of people’s livelihood.
The conference also noted that China is still, and will continue to be for a long time, in an important period of strategic opportunity for development. This conclusion was reached based on the fact that peace and development remain current themes and globalization will not be reversed despite recent resistance. The new round of scientific and technological revolution and industrial transformation needs the support of huge markets like China. In the meantime, as China consistently expands its opening up, other countries hope to find more development opportunities in the country.
Regarding the current economic situation, the conference said that “there are changes amid stability and causes for concern amid changes,” which indicated the Chinese Government’s clear understanding of the domestic and international situations. Globalization and the free trade system are challenged as protectionism surges. The growth of China’s key economic indicators such as consumption and investment show fluctuations; therefore China still faces daunting tasks in preventing and dissolving risks.
The meeting also proposed to foster the transformation from an opening up of commodities and production elements to an institutional type of opening up, indicating another major step in China’s opening-up process. The approach used in the opening up of commodities and production elements over the past four decades has facilitated the free flow of capital and commodities through tariff reductions and preferential policies. However, as domestic and international circumstances change, the effectiveness of the old approach is declining. In order to improve the quality of opening up, China needs to dovetail domestic rules with international standards and institutionalize some ongoing reforms, such as the foreign investment negative list.
As the uncertainty and complexity of the world economy increases, the Chinese economy is destined to face more challenges in 2019. At the same time, there are also many favorable factors for economic growth. Hopefully, the Chinese economy will continue to maintain the stable and rapid growth it has seen over the past years in 2019.