China’s 5-yr plan to lead global recovery

China is aiming to lift its economic, technological and national strength to a new, higher stage in the next five years, under a sweeping blueprint that has put heavy emphasis on improving domestic economic conditions, boosting technological innovation and national security, while leaving sufficient room to cope with mounting risks and challenges, officials said.

In a break from a decades-long tradition, China’s 14th Five-Year Plan (2021 to 2025) did not set a specific gross domestic product growth target — for the first time in the country’s history of making up five-year plans — but instead stresses goals in other indicators, including unemployment rate, energy consumption and carbon dioxide emissions, in line with a mission to improve people’s livelihood and quality of development.

The change also reflected mounting uncertainties for the Chinese economy, including severe global conditions, a shaky domestic recovery with constraints on consumption and investment, officials and analysts said.

But the world’s second-largest economy is widely expected to continue to take the lead in the global recovery from the coronavirus in the coming years, and various policy initiatives in sectors such as consumption, environmental protection, market reform and opening are set to offer great opportunities for businesses and products from around the world, foreign firms and experts noted.

The 14th Five-Year Plan has been submitted for review at the ongoing two sessions. Coming at a critical inflection point for China’s social and economic development, the sweeping plan - with 192 chapters and 74,000 Chinese characters - offered ambitious development goals and detailed plans for the next five years, officials said on Monday.

Among the key highlights are two historic firsts. For the first time, the new Five-Year Plan did not include a specific GDP growth target and instead announced that growth would be kept in “reasonable range” and an annual target would be set based on the specific conditions each year.

In the 13th Five-Year Plan (2016 to 2020), a growth target of above 6.5 percent on average was set.

While GDP growth was maintained above 6.5 percent in the first three years, the coronavirus pandemic brought the five-year average to around 5.7 percent.

Also for the first time, the plan contained a special section for development security, aiming to bolster national security system and capabilities and setting arrangements to ensure food, energy and financial security.

The plan contains 20 main indicators covering a wide range of areas, including eight obligatory targets, with seven focusing on ecological protection and security support.

Among them, targets for food and energy production were included in the five-year plan for the first time. On food security, for example, the new plan said that China would adhere to the 1.8 billion mu (120 million hectares) red line of cultivable land to ensure food security.

“In setting the target, [the plan] adheres to science and rationality, and it is inspiring and practical, while leaving room for dealing with uncertainties,” Hu Zucai, deputy director of the National Development and Reform Commission, the country’s top economic planner, told a press conference on Monday.

Specifically, the plan aims to implement a “dual circulation” development strategy that focuses on boosting the domestic market, enhancing technological self-efficiency and independence with significant increase in research and development (R&D), and bolstering environmental protection through investments in renewable energy.

For example, basic R&D expenditure is set to grow over 7 percent during the new five-year period, outpacing anticipated economic growth, and the environmental protection sector is set to reach a trillion yuan, officials said.