China’s ‘two sessions’: ambitious but practical goals in five-year plan target high-quality growth

Innovation and technological development are the foremost drivers of productivity growth and thus are the top priority in the new five-year plan

Investment in frontier fields, R&D, new infrastructure, green manufacturing and more form the core of China’s plans for long-term growth

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President Xi Jinping votes on changes to Hong Kong’s election system during the closing session of the National People’s Congress at the Great Hall of the People in Beijing on March 11. Photo: AFP

Chaoping Zhu

Chaoping Zhu is a Shanghai-based global market strategist at JP Morgan Asset Management.

Published: 4:30pm, 12 Mar 2021Updated: 4:30pm, 12 Mar 2021

In the government work report delivered by Premier Li Keqiang to the National People’s Congress earlier this month, the 2021 growth target was set at above 6 per cent year on year. This target seems conservative and significantly below the consensus forecasts around 8.7 per cent by local economists.

It reflects the leadership’s commitment to achieve sustainable and healthy economic growth in the long run while shifting from quantity-driven growth to a quality-driven growth model in the coming decade.

During the annual “two sessions” legislative meeting, the 14th five-year plan draft outline and long-term development goals for 2035 were submitted to representatives for review. In these plans, the long-term development road map was laid out in more detail, which helps us better understand the essence of the high-quality growth.

First, sustainable growth in labour productivity is at the core of high-quality growth. In the government work report, the goal was set to keep higher growth in labour productivity than that of GDP during the period covered by the 14th five-year plan.