Key Takeaways From China's Central Economic Work Conference (Part 2)

Key Takeaways From China's Central Economic Work Conference (Part 2)

by Swarajya Staff - Dec 18, 2022 10:05 PM +05:30 IST
Key Takeaways From China's Central Economic Work Conference (Part 2)Xi Jinping

(Continued from Part 1)

In response to Western technology sanctions, Xi Jinping emphasized the importance of a resilient industrial chain. 

In addition, the conference also mentioned that China's science and technology industry should be self-reliant and "must effectively coordinate education, science and technology, and talent work to improve the quality and ability of independent talent cultivation."

There is concern that this means China's high-tech industrial chain will further decouple from the global economy. 

China's emphasis on self-reliance in science and technology is a response to international encirclement. Over the past decade, the US has implemented increasingly strict technological sanctions against China under the leadership of Trump, and now Biden.

Analysts believe that these measures have made it increasingly difficult for China to conduct business and access technology, and as a result, China has had to find ways to respond to these challenges.

China has been working to develop its own technological capabilities and become less reliant on the United States for a long time. This includes efforts to produce its own chips, solar energy, artificial intelligence, and electric vehicles.

The conference also reaffirmed "two unwavering" [principles], "to deepen reform of state-owned enterprises and improve the competitiveness of state-owned enterprises," while "forming a legal and institutional perspective, treating state-owned enterprises and private enterprises equally, and from a policy and public opinion perspective, encouraging and supporting the development and growth of the private economy and private enterprises."

The conference also pointed out that "private enterprises' property rights and entrepreneurs' rights and interests must be protected by law." This is different from Xi Jinping's previous high-profile advocacy of "common prosperity" and crackdown on private enterprises. 

China's real estate and automotive markets have been struggling for a few years, but the country's leader, Xi Jinping, is encouraging consumers to have confidence in the market and spend more in order to boost the economy.

He wants people to shift away from their cautious consumption and investment habits, which have been influenced by the concept of "dynamic zeroing," and to adopt a more neutral or actively consumerist attitude. This could help improve the overall state of the Chinese economy.

The conference also emphasised "fully promoting rural revitalisation and resolutely preventing large-scale re-poverty." In the past decade, Xi Jinping has regarded leading China to comprehensive "poverty alleviation and moderate prosperity" as one of his most important achievements.

In addition to expanding domestic demand, the five main tasks for next year include speeding up the construction of a modern industrial system, implementing "two unwavering" principles, and more actively attracting and using foreign investment and effectively preventing and resolving major economic and financial risks.

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