As the Chinese Communist Party celebrates its 100th anniversary, its current leadership is reshaping how it plans to work with the rest of the world – and we should all be paying close attention, Jason Young writes

The National People’s Congress (NPC) recently held its annual meeting at the Great Hall of the People in Beijing. This year, China’s leaders unveiled details of the 14th Five Year Plan (FYP, 2021–25), setting out China’s intention to become a high-tech manufacturing superpower through wide-ranging production and development targets.

The 14th FYP puts in place concrete measures all levels of government will work towards over the next five years. It determines policy settings on investment, tax and social security spending. It also sets the overall level of energy consumption, food production, the rate of urbanisation and the share of the economy devoted to particular industries.

The FYP not only outlines government spending and aspirations for development – it also serves as a roadmap for the economic, industrial and social structure of China. It is a state-led and determined intervention made possible by the policies and levers that exist in a socialist market economy.

The Communist Party of China (CPC), celebrating its 100th anniversary this year, remains central to these targets with its strong historical mission of rejuvenation and pursuit of the China dream.

When considered next to the dual circulation strategy, there is a strong sense Chinese planners are heavily focused on managing their external economic engagement in response to deteriorating relations with the advanced economies.

Dual circulation simultaneously promotes growth in domestic demand and an increase in the role and position of Chinese companies in global value chains. It seeks to develop domestic industries, limit reliance on foreign technology and reshape China’s external economic engagements.

This type of policy is not so much about dealing with ‘complex interdependence’, an idea that lies at the heart of contemporary economic globalisation and international relations and one all countries must confront. For China, the state has front footed a plan to create a form of ‘managed interdependence’ that maximises its economic leverage and minimises its economic vulnerabilities.

Countries will need to carefully consider how they best engage with Chinese economic forces under these conditions.

The recent NPC also published details on the mid-term 2035 goal to achieve ‘socialist modernisation’ and push China to the vanguard of innovative countries around the world.

If successful, this goal will see China establish a modern economic system, achieve the gross domestic product per capita of a moderately developed nation and develop a sustainable economic and social structure.

The centralised planning on environmental goals is significant for the world’s largest greenhouse gas emitter and provides an opening for collaboration on this shared global challenge.

By 2035, China should be the world’s largest national economy and have acquired modern defence and military forces. It will, if it is not already, be recognised as a powerful, if not the most powerful, country in our region and have vastly improved the quality of life for its citizens.

According to the goal, by 2035 China will have established “new patterns in foreign relations and opening to the world” as it seeks to create a “new type of international relations”.

As State Councillor and Foreign Minister Wang Yi recently argued, “For China, 2021 will be a year of epoch-making significance. We will celebrate the centenary of the CPC and start a new journey in China’s diplomacy.”

If these goals are successful, China will be the most powerful country in Asia. What will these “new patterns in foreign relations” and this “new era”, as the CPC refers to it, mean for other countries in the region?

China’s recent approach to foreign and domestic policy suggests the current leadership thinks it has the requisite resources and strength to largely ignore efforts to shape its rise and is not overly constrained by the views and interests of other countries.

Condemnation over the erosion of autonomy and democracy in Hong Kong and the treatment of ethnic groups in Xinjiang has not changed Beijing’s behaviour. Condemnation over backsliding on intellectual freedoms, media freedom and the separation of party and state has not slowed China’s rise.

Economic punishment of Australia and other countries over diplomatic differences has occurred without China incurring any significant costs, aside from those to its reputation.

Beijing has fended off pressure from the United States under both the Obama and Trump administrations for it to change its state-led economic practices.  

China is emerging as a powerful, confident and assertive country with its own political traditions and tendency to go it alone. It will remain an important economic partner for most countries in the region and is already a regional power. Understanding China’s political traditions and its foreign policy behaviour is crucial to successfully managing its emergence.

As China embarks on its 14th Five Year Plan, there is much to celebrate in the developmental goals it has put forward, but this exercise in planning also demonstrates the nature of the Chinese system and the importance of engaging accordingly.

Associate Professor Jason Young is director of the New Zealand Contemporary China Research Centre at Te Herenga Waka - Victoria University of Wellington.

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