The Chinese central government held its central economic working meeting in Beijing from 8 to 10 December, for the purpose of summarising economic work in 2021, analysing current economic conditions and outlining economic work arrangements for the upcoming year.
The meeting highlighted the need to confront the “three pressures” faced by the Chinese economy at present, including demand contraction, supply shocks and weakening of expectations, as a result of ongoing uncertainty in relation to the COVID-19 pandemic.
With regard to economic work in 2022, the meeting called for “making stability the watch word, pursuing progress amidst stability, each of the regions and authorities bearing the responsibilities of stabilising the macro-economy, and actively driving policy in all areas that is of benefit to economic stability.”
“Entering a new phase of development, China’s internal and external environment is undergoing profound change, and faces multiple new major theoretical and implementation issues that must be correctly understood and grasped,” concluded the meeting.
These issues include:
- The implementation of common prosperity strategic goals and implementation pathways: “Under the Chinese socialist system, we must continually create and accumulate social wealth while also preventing polarisation.”
- The features and behavioural laws of capital: “The socialist market economy is a great creation, which requires employing the positive role of capital as a factor of production, and at the same time effectively controlling its negative effects…[we] must lawfully strengthen effective regulation of capital, and prevent the wild growth of capital.”
- Protecting the supply of primary products: “We must uphold the strategy of economisation priorities, implement comprehensive economisation, and drive comprehensive economisation, concentration and recycled usage of resources.”
- The prevention and dissolution of major risk: “We must continue to effectively seize risk disposal work, strengthen the establishment of the rule of law in finance, and consolidate the responsibilities of local government, financial regulators and industry bodies. We must strengthen the development of capabilities and the establishment of financial regulatory cadre teams.”
- Peak carbon and carbon neutrality. “Achieving peak carbon and carbon neutrality is an intrinsic requirement of driving high-quality development, and we must advance unwaveringly, yet this cannot be achieved all at once.”
The meeting also highlighted the following themes and focal points for economic work in 2022:
- Stable and effective macro-policy, and the need to “continue to implement active fiscal policy and stable monetary policy.”
- Micro-economic policy that “continues to stimulate the vitality of market actors.” This will include “rousing the confidence of market actors, deeply driving the implementation of policies for fair competition, and strengthening anti-trust measures and measures against inappropriate competition.
- Structural policy must focus on smoothing out economic cycles in the national economy. “We must deepen supply side structural reform, with an emphasis on smoothing our major domestic cycles, and breaking through blockages and constraints in supply.”
- Science and technology policy must be thoroughly implemented. “We must implement the three year action plan for reform of the science and technology system, and formulate and implement ten year plans for basic research.”
- Reform and opening policy must stimulate impetus for development. “We must effectively seize comprehensive reform trials for the market-based allocation of factors of production, comprehensively implement the share issuance registration system, complete the three year action tasks for state-owned enterprise reforms, and steadily drive reform of sectors with natural monopolies such as the power grid and rail.”
- Regional policy must strengthen the balance and coordination of development. “We must deepen implementation of major regional strategies and strategies for coordinated regional development.”
- Social policy must uphold the bottomline of living conditions. “We must advance economic development and guarantees for living conditions, and improve the system for the supply of basic public services for permanent residents. We must effectively resolve the problem of employment for tertiary graduates and other young people, and improve flexible employment labour usage and social welfare policies.”