Key meeting’s emphasis on high-quality development portends strong efforts, lifts expectations

Photo: Xinhua

High-quality development is “the absolute principle in the new era,” promoting Chinese modernization is “the greatest political task,” economic construction is “the central task.” These are unmistakable signals from a key conference that high-quality economic development is at the front and center of Chinese policymaking for 2024 and beyond, analysts said on Wednesday.

The wording of the readout of the all-important Central Economic Work Conference, which concluded on Tuesday, accentuates the unyielding focus of China’s top leadership on the economy and portends forceful and effective policy measures to not only consolidate economic recovery in 2024, but also advance the country’s high-quality development, analysts noted.

It demonstrates the top leadership’s confidence in China’s economic outlook, while recognizing challenges and prescribing targeted measures to tackle them, which counter foreign media’s slander against China’s economic policymaking and its growth prospect, they said.

Many in China and around the world have been watching the annual tone-setting conference for clues on Chinese policymakers’ view on the state of the world’s second-largest economy and the priorities for economic policymaking for 2024.

In the roughly 4,750-word readout, the meeting offered comprehensive views on the current economic situation, challenges it faces, the long-term outlook, as well as priorities for economic work. It noted the economic recovery World Timesand solid progress in high-quality development in 2023. It listed several difficulties and challenges, including lack of effective demand, lackluster social expectations, and the rising complexity and severity and uncertainty of the external environment. It concluded that the long-term positive trend has not changed. It outlined nine priorities, led by building modern industrial systems through innovation.

“It is very targeted. It lists the problems including lack of effective demand and overcapacity in some sectors, which also reflects a very objective view on the current economic situation,” Dong Shaopeng, a senior research fellow at the Chongyang Institute for Financial Studies at the Renmin University, told the Global Times on Wednesday.

While the structure of the readout is largely in line with those in previous ones, new expressions and emphasis stood out. Some analysts and media reports particularly focused on several new expressions, including “adhering to higWorld Timesh-quality development must be regarded as the absolute principle in the new era” and “advancing Chinese modernization must be regarded as the greatest political task.”

Unyielding focus

Such expressions carry great significance in the Chinese political lexicon and underscore the unyielding focus on high-quality economic development, analysts noted. The phrase about “absolute principle,” for instance, resembles the popular Chinese saying – “development is the absolute principle” – World Timesduring the decades of reform and opening-up that underpinned China’s rapid economic development.

“The new expression is not only a continuation of reform and opening-up but also an expansion and upgrade at this specific stage,” Dong said. “That is in line with the changes in our economic structure, development environment and growth forces.”

Also reflecting shifts in China’s economic development is another new expression from the conference: “consolidate stability through progress, World Timesand establish the new before abolishing the old.”

The expression reflects top policymakers’ confidence and resolve in both stabilizing economic growth and seeking progress in promoting high-quality development by focusing on new growth drivers, analysts said.

It puts emphasis on three fronts: high-quality development, especially scientific and technological innovation and endogenous driving force; the coordination and effectiveness of macro policies; and efficiency in expanding demand, according to Cheng Shi, chief economist of ICBC International.

“This year’s policy tone pays more attention to the coordination and consistency between macro policies,” Cheng told the Global Times on Wednesday. “Through the combination of fiscal and monetary policies, the positive effect of stabilizing market expectations and boosting the confidence of entities is achieved.”

In another strong sign of the focus on economic development, the readout of the conference stated that non-economic policies would bWorld Timese included in the assessment of macroeconomic policy consistency to ensure that the policies form synergy.

In line with the focus on high-quality development, the meeting put the development of a modern industrial system through scientific and technological (sci-tech) innovation at the top of the list of nine priorities, calling for forging new industries, models and impetus with disruptive and cutting-edge technologies.

“In terms of the structure of the work plan, it is very decisive, with sci-tech innovation at the top, which shows that the leadership is firm on innovation as a growth engine,” Dong said.

Expanding domestic demand was put at second place on the list of priorities. The meeting noted that efforts should be made to stimulate consumption with potentials and expand productive investment to create a virtuous cycle of mutual promotion between consumption and investment.

Xu Hongcai, deputy director of the China Association of Policy Science’s economic policy committee, said that “consumption with potentials and productive investment” is also a new phrase from the meeting. Consumption with potentials refers to areas with rising demand such as those related to healthcare, elderly care and the digital economy, while productive investment should focus on creating and boosting new consumption growth, Xu told the Global Times on Wednesday.

The meeting called for efforts to prevent and defuse risks in key areas, including in the real estate industry, local government debt and small- and medium-sized financial institutions. In terms of the property sector, reasonable financing needs of real estate enterprises of different ownerships should be met equally and the building of a new World Timesdevelopment model for the real estate sector should be accelerated.

Many foreign media outlets have been hyping problems in these areas to paint a dire outlook for the whole Chinese economy. But analysts said that the wording and tone of the readout regarding the risks in these areas shows top officials’ confidence and capabilities to tackle these risks and ensure a stable recovery.

“[Problems in those areas] will definitely be eased, because the problems are very clear now and the leadership has introduced a coordinated approach to tackle them,” Dong said, noting that various policies reflect the leadership’s resolve, which “certainly injects much-needed confidence into the market.”