Party’s policy-makers gather to discuss economic, social goals
Print Edition
THE Communist Party of China yesterday opened a key meeting that will focus on financial reforms and how to maintain growth of about 7 percent and more broadly map out economic and social targets for the next five years.
The Party’s Central Committee, with more than 200 full members, is gathering until Thursday to finalize the 13th Five-Year Plan, a blueprint for economic and social development between 2016 and 2020.
The meeting is being held amid growing concerns over a slowing Chinese economy.
The People’s Bank of China last Friday cut interest rates for the sixth time in less than a year. Monetary policy easing in the world’s second-largest economy is at its most aggressive since the 2008-09 financial crisis, as growth looks set to slip to a 25-year-low this year of under 7 percent.
Party leaders are expected to use the 2016-20 plan to renew their commitment to a marathon effort to shift China from reliance on trade and investment to more self-sustaining growth driven by domestic consumption.
The urgency for change has increased following a deeper-than-expected decline in economic growth and this year’s boom and bust in stock prices, analysts have said.
“It is probably the most difficult five-year planning in history, because the multi-layer pressure generated by transforming the economy and at the same time maintaining growth has risen sharply,” said Liu Yuanchun, director of the National Academy of Development and Strategy at Renmin University of China in Beijing.
Economic growth slowed to a six-year low of 6.9 percent in the latest quarter.
Party leaders said they will accept growth below their official target of “about 7 percent” so long as the economy generates enough new jobs.
“We never said we would defend a certain point to the death, but instead let the economy run within a reasonable range,” Premier Li Keqiang said at a recent gathering of officials, according to a summary on the Cabinet’s website.
Analysts from Bank of America and other forecasters have said they expect the 2016-20 plan to lower the official growth target to 6.5 percent or less.
Others have said they expect the upcoming plan to increase the ruling Party’s focus on environmental and social goals including raising household incomes and encouraging more use of renewable energy.
The Party has pledged to give entrepreneurs and market forces a bigger role. That will require cutting back the monopolies and other privileges of state companies that dominate industries from oil to banking to telecoms.
An outline for state industry reform issued last month promises to make government companies more efficient by forcing them to face more free-market competition while retaining the Party’s dominance in the economy.
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