Chinese President Xi Jinping attends the National Day reception on the eve of the 71st anniversary of the founding of the People’s Republic of China in Beijing, China, on September 30, 2020.
Thomas Peter | Reuters
BEIJING – The Chinese government is due to start an annual parliamentary meeting this week to approve national priorities for 2021.
The delegate meeting, known as the “Two Sessions”, oversaw changes such as the abolition of President Xi Jinping’s term limits in 2018 and the proposal for a new security law for Hong Kong last year.
The generally symbolic meeting takes on particular significance this year as it marks the beginning of China’s five-year development plan – the 14th in the country’s history – and the 100th anniversary of the ruling Communist Party.
The authorities are expected to provide details on topics ranging from employment targets to the management of the semi-autonomous region of Hong Kong.
These comments will come as Beijing seeks to show progress in development pledges made to the country of 1.4 billion people and increase China’s competitiveness in a world shocked by the coronavirus pandemic and increasingly cautious about the Asian giant’s rise.
No specific GDP target expected
The “Two Sessions” parliamentary meeting is scheduled to start on Thursday with the opening of the Chinese People’s Political Consultative Conference, an advisory body. The Legislative of the National People’s Congress is scheduled to start its annual meeting on Friday.
It is usually when the government releases its economic work report, a document that sets GDP, employment, inflation and other growth targets.
Most economists do not expect the authorities to disclose a GDP target this year, after making a rare decision not to do so at last year’s parliamentary meeting, which was delayed for about two months due to the coronavirus pandemic.
Li-Gang Liu, Citi Research’s managing director and chief economist for China, said in a note that if the report sets a GDP target directly or indirectly, the figure could reach 7%. This is in line with the growth targets announced by different Chinese provinces and a commitment to double GDP from its level in 2010, said Liu.
On monetary policy, while officials have emphasized that they will not abruptly reverse stimulus policies, “we expect China’s monetary policy conditions to become noticeably more restrictive this year,” added Liu.
China’s economy grew 2.3% last year, despite the shock of the coronavirus pandemic, when officials rushed to control the domestic spread of the virus and support companies with cheaper tax cuts and loans. This GDP growth followed a 6.0% expansion in 2019, according to official data.
On employment, economists generally predict that China will aim to create more than 10 million new urban jobs this year, up from 9 million last year.
A plan for the next five years
The parliamentary meeting will also share details and approve China’s 14th five-year plan. The development strategy for the world’s second largest economy comes when it reaches historic trade deals with its Asia Pacific neighbors, while facing greater pressure from a United States that increasingly considers China a competitor.
The plan’s emphasis on “boosting domestic demand, upgrading the supply chain, technological self-sufficiency and further opening up domestic markets are the main tools to protect against external uncertainties,” said Bruce Pang, China’s head of macro and strategic research. Renaissance, in a report.
In addition to details on how China can address national security issues in technology and energy, officials are expected to draw up plans for defense spending in 2021.
Details on how Beijing plans to strengthen control of Hong Kong may also come up at this year’s parliamentary session.
Late last month, Xia Baolong, director of the State Council’s Hong Kong and Macau Affairs Office and vice president of the Chinese People’s Political Consultative Conference – the political advisory body assembled during “Two Sessions” – delivered a speech on the electoral system should be changed so that only central government supporters oversee the semi-autonomous region.
The parliamentary meeting is expected to last about 10 days and include press conferences with Foreign Minister Wang Yi and Prime Minister Li Keqiang.