Chinese President Xi Jinping attends the reception on the National Day 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 kicks off an annual parliamentary meeting this week to approve national priorities for 2021.
The meeting of delegates, known as the “Two Sessions”, has overseen changes such as President Xi Jinping’s end of deadlines in 2018 and the proposal for a new Hong Kong security law last year.
The otherwise generally symbolic gathering takes on special significance this year as it marks the beginning of China’s five-year plan – the fourteenth 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 objectives to the management of the semi-autonomous region of Hong Kong.
Such comments will come as Beijing seeks to show progress on the development promises made to the country of 1.4 billion people and build China’s competitiveness in a world shaken by the coronavirus pandemic and ever wary of the rise of the Asian giant.
No specific GDP target expected
The parliamentary meeting “Two Sessions” kicks off Thursday with the opening of the Chinese People’s Political Consultative Conference, an advisory body. The legislature of the National People’s Congress begins its annual meeting on Friday.
That’s usually when the government publishes its economic work report, a document outlining GDP, employment, inflation and other growth goals.
Most economists don’t expect authorities to release a GDP target this year, having made a rare decision not to do so at last year’s parliamentary meeting, which was delayed by about two months due to the coronavirus pandemic .
Li-Gang Liu, China’s general manager and chief economist at Citi Research, said in a note that if the report directly or indirectly indicates a GDP target, the figure could be 7%. That’s according to growth targets announced by several Chinese provinces and a commitment to double GDP from 2010 levels, Liu said.
On monetary policy, while the authorities have stressed that they will not reverse stimulus policy abruptly, “we expect China’s monetary policy conditions to tighten visibly this year,” added Liu.
The Chinese economy grew 2.3% last year despite the shock of the coronavirus pandemic as authorities rushed to contain the virus’s domestic spread and support businesses with tax cuts and cheaper loans. That GDP growth followed an expansion of 6.0% in 2019, according to official figures.
In terms of employment, economists generally expect China to 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 assembly will also share details and approve China’s 14th Five-Year Plan. Its development strategy for the world’s second-largest economy comes because it has concluded historic trade deals with its neighbors in Asia and the Pacific, while facing increased pressure from a United States that increasingly sees China as a competitor.
The plan’s emphasis on “boosting domestic demand, upgrading the supply chain, technology self-sufficiency and further opening up domestic markets are the key tools for hedging against external uncertainties,” said Bruce Pang, chief executive officer macro and strategy research at China Renaissance, in a report.
In addition to specific information on how China could address national technology and energy security issues, authorities are expected to prepare defense spending plans in 2021.
Details on how Beijing plans to strengthen control over Hong Kong may also emerge from this year’s parliamentary session.
Late last month, Xia Baolong, director of the Hong Kong and Macao Affairs Office of the State Council and the vice-chair of China’s People’s Political Consultative Conference – the political advisory council that met during ‘Two Sessions’ – gave a speech on how the electoral system should be changed that only supporters of the central government would oversee the semi-autonomous region.
The parliamentary meeting is expected to last approximately 10 days and will include press conferences with Foreign Minister Wang Yi and Prime Minister Li Keqiang.