The cult of personality surrounding Chinese President Xi Jinping has been burnished as China unveils its next five-year plan for economic and social development. But the Beijing leadership also has set a new, internalized course that places greater emphasis on self-reliance, particularly in technology.
Acting as head of the proposal drafting group, President Xi "personally led" the formulation of the new five-year plan through 2025 and long-range objectives through 2035, according to the propaganda on Friday.
"Comrade Xi Jinping" is the "core" of China's Central Committee, and indeed core of the whole Communist Party, a spokesperson said on Friday. With him at the helm, the "tenacious struggle" of the whole party and "all ethnic groups in the country," China will surely overcome all difficulties and obstacles in its way, Wang Xiaohui said, while definitely not reading from the Xi script. No siree.
Details have been emerging on Friday after the Communist Party's powerful Central Committee the day before wrapped up a four-day closed-door planning "plenary session," which also set long-term, 15-year goals through 2035.
Innovation will drive the country's modernization under the new five-year plan. That's an innocuous concept, but the Communist Party is also saying that China should become self-reliant regarding science and technology, a departure from its normal insistence on China taking a position center stage in global affairs.
China loves its five-year plans, and is perhaps the only major nation to place stock in such overarching schemes anymore. This is the 14th five-year installment since Mao started the first one in 1953, following the creation of the People's Republic of China in 1949.
It's a throwback to the centrally planned Soviet-style economies of the Communism of old. It has more to do with Marxism and grain-harvest targets, less to do with socialism with Chinese characteristics that has essentially meant capitalism for the little people, with Communists on top.
Indeed, the communiqué released out of this meeting says that the current tenets of "Xi Jinping Thought" are at the heart of the country's direction. But it says they also build on the grand schemes of all the previous Chinese leaders: the guidance of Marxism-Leninism feeding into Mao Zedong Thought, through Deng Xiaoping Theory, on to the "important thinking" of Jiang Zemin's Three Represents, then next to the Scientific Outlook on Development championed by Hu Jintao, and now Xi's Thought to cap what started with Mao's Thought.
All this language clearly equates Xi with Mao, with Xi's firm hand on the helm making him the strongest leader since the original Great Helmsman.
"The ship of socialism with Chinese characteristics continues to ride the wind and waves and move forward with determination," the communiqué states.
Xi's prominence reminds all involved - particularly Communist Party members - that there is currently no serious challenge to his power. The drafting of the five-year plan is normally handled by China's premier, but the president took it over. Xi, 67, used his speech at the end of the meeting to set up his bid for a new term as leader in 2022. He has eliminated term limits and by then will have served longer than any Chinese leader since Mao.
There are quirks to the new plan. It stresses that "social etiquette and civility" must be enhanced. What's more, a "significant improvement is expected to be made in people's intellectual and moral integrity," according to the official Xinhua news-agency recounting of proceedings, "as well as physical and mental health."
The Communist Party didn't quite live up to its stated aim in the previous five-year plan of eliminating poverty by the end of 2020, set back by slowing growth and then the coronavirus. But it is now setting its sights on catapulting China into the ranks of a middling developed nation in terms of income and economy.
China shortly will set detailed targets for economic growth over the next five years, a state planner said on Friday. The five-year plan will be officially approved by the whole party next year.
The government ditched its hard target for GDP growth in 2020. The difficulties surrounding Covid-19 produced the first negative quarter for the economy on record, with a 6.8% decline in the first quarter. But the stats team will produce "quantitative targets and specific indicators" from 2021-2025, as recommended by China's top leadership, according to Ning Jizhe, the vice head of the National Development and Reform Commission.
The Chinese economy is forecast to grow 2.0% in 2020, according to Oxford Economics, which would make it the only major economy to get bigger this year. The increase should be enough to propel the total economy past C¥100 trillion (US$14.1 trillion) for the first time.
The long-term plan says China aims to boost per-capita GDP to levels similar to those in moderately developed nations by 2035. While that implies annual average growth of at least 3% to 4% for the next 15 years, shorter-term targets are likely to be for growth around 5.5%.
China has adopted a "dual circulation strategy," a phrase first coined by Xi in May. No one was too sure what exactly it meant.
That's still somewhat open to debate. But the scheme stresses first and foremost the importance of "internal circulation," meaning to enhance domestic demand and to meet that with domestic supply. The aim is also to play down the "external circulation" of international trade and cross-border investment.
Specifically, Beijing will attempt to reduce its dependence on high-tech imports such as microchips and reduce its dependence on foreign markets as destinations for its low-end manufactured goods.
The shift to emphasize domestic circulation is a response to the worsening international environment for China. The country has embarked on a stunning number of political and diplomatic squabbles. It is taking Britain, Canada and Germany to task diplomatically for receiving Hong Kong dissidents, restricting Australian agriculture as a result of Canberra's demand for an independent inquiry into the origins of Covid-19, engaging in deadly clashes with Indian troops in the Himalayas, alienating almost all of Southeast Asia with its island building in the South China Sea, getting into a squabble with the European Union after it demanded China close its concentration camps for Muslim minorities, has been criticized for its poor human rights in Xinjiang Province and Tibet by 39 developed countries at the United Nations, and of course has had a falling out with the United States on trade.
The need to build a domestic chip industry has become urgent due to U.S. trade restrictions on Huawei Technologies and the telecom ZTE. The administration of U.S. President Donald Trump has also leveled threats at the Chinese-owned apps TikTok and WeChat, which break the stranglehold of U.S. Big Tech over our smartphones and which are used by millions in America and around the world.
The push to internalize economic development and turn inward reminds me a little of Japan in the Tokugawa shogun era, when Japan until 1853 pursued kaikin, a policy that prohibited most contact with outside countries.
But it's not really possible in the 21st century, when Chinese companies still depend so much on international markets and multinationals continue to pump capital and products into China.
We can expect the "dual circulation" strategy to be a little confused as a result. If China focuses inward, well, that's by design of the first circulation. If it turns outward, well, that's by design of the second circulation. All according to the Communist Party's plan.
So although the plenum ended with the new policies aimed at promoting China domestically, there were decidedly mixed messages. A senior Communist Party official said that international circulation was an "integral part" of China's efforts to set up a "new development pattern," which "takes the domestic market as the mainstay while letting domestic and foreign markets boost each other."