The following is the text of a speech that Chinese President Xi Jinping delivered to a symposium of economists and sociologists in August 2020, which he had convened to solicit input for China’s upcoming 14th Five-Year Plan. In his remarks, Xi emphasizes the importance of reducing the Chinese economy’s dependence on foreign markets, although he insists that China’s opening up to the world will continue, and will include cooperation with U.S. state and local governments and U.S. companies. Xi concludes by reminding his audience to study Marxist economic theory.
The Chinese source text is available online at: https://web.archive.org/web/20200908034042/http://www.xinhuanet.com/politics/leaders/2020-08/24/c_1126407772.htm
Translator: Etcetera Language Group, Inc.
Editor: Ben Murphy, CSET Translation Lead
Today, we are holding this symposium of experts from the economic and social fields with the hope of collecting suggestions and advice about the devising of the “14th Five-Year Plan.” Present at the symposium today are both economists and sociologists. We just heard enlightening speeches from experts and scholars. Each speech was rooted in his or her own field of specialization, providing us with valuable advice and suggestions about the environment, approach, objectives and measures of the “14th Five-Year Plan.” I am very much inspired. There are other experts who have submitted their opinions in writing. Relevant organs and offices, please consider and take heed. Now, I will briefly talk about correctly identifying and managing key issues in mid- and long-term economic and social development.
The use of medium- and long-term plans to guide economic and social development is an important approach that the Chinese Communist Party (CCP) employs to manage the country. Since 1953, we have devised and implemented 13 Five-Year Plans, 8 of which have taken place since the beginning of reform and opening up, effectively boosting economic and social development, China’s overall strength and the Chinese people’s quality of life. The rapid economic growth and prolonged social stability that has been achieved is nothing short of a miracle, rarely seen anywhere in the world. As proven in practice, mid- and long-term development plans can sufficiently utilize the market as a critical means of resource allocation, and can better enable the role of government.
The period of the “14th Five Year Plan” marks the realization of forming a well-off society in an all-round way, and the fruition of our first centennial objective.1 It marks the full-on start of a new journey, of building a modernized socialist country (社会主义现代化国家). This is the first Five-Year Plan toward our next centennial goal in which China will adapt to a new phase of development. Only the prepared shall go far. We must have a long-term vision, grasp overall trends, and encourage and widely adopt advice to analyze new situations and develop new plans.
First, opportunities and challenges in the new phase of development must be discussed in a dialectical context. Since the 19th Party Congress, I have mentioned multiple times that the world as we know is facing significant changes never seen before in the past century. Said changes are being accelerated by the raging pandemic of COVID-19. Protectionism and unilateralism are on the rise, while the world economy dives low. Production chains worldwide are challenged by non-economic factors. The international economy, technology, culture, security and politics are undergoing fundamental shifts in many ways. The world is entering into a time of turbulence and transformation. For a while, we will face an external environment with more adverse forces. Therefore, we must be prepared for a series of new risks and challenges.
Meanwhile, domestic development is undergoing significant changes as well. Currently we are prioritizing our quality of development. The main contradiction in society today is the one between the people’s steadily increasing demands for good quality of life on the one hand and imbalanced and insufficient development on the other. Our per capita GDP is now over US$10,000. With an urbanization rate of over 60% and over 400 million people in the middle-income bracket, the demand for good quality of life is ever increasing. We have many advantages for further development, including remarkable institutional superiority, improved administrative efficiency, sustained economic growth, rich industrial and labor resources, vast market volume, great flexibility and a stable society. However, on the other hand, the lack of balance and sufficiency in our development is still outstanding. Our capacity for innovation is not enough to support development of high quality. The agricultural base is relatively weak. The disparity of development and income distribution between rural and urban regions remains stark. There is more to be done in environmental protection, social security and social management.
In sum, we have entered a new stage of development. Deep-seated changes to the international and domestic environments will bring new opportunities, as well new challenges. With the right approach, challenges can be turned into opportunities. We must be dialectical in identifying and approaching trends, both international and domestic, to navigate the strategy of the great rejuvenation of the Chinese nation (中华民族伟大复兴战略) and a rapidly shifting world. The new most pressing conflict presents new characteristics and demands. A highly complicated international society creates new challenges. We must firmly grasp these factors, and be more aware of opportunities and risks. Our objective is to continue development in a more efficient, fair, sustainable, safe and quality-over-quantity way. For that, we have to accurately and soundly identify and adapt to changes, or even actively make changes. As I have just said, challenges may be turned into opportunities, and we must bravely embrace risks.
Second, we must construct a new development pattern that prioritizes domestic economic circulation (国金经济循环). Since the beginning of this year, I have repeatedly spoken about advancing the formation of a new development pattern that takes domestic circulation as the mainstay and in which domestic and international dual circulation (双循环) are mutually reinforcing. This idea is based on China’s current stage, environment and conditions of development. It is a strategic choice to reconstruct China’s international cooperation and competition to give ourselves a new advantage. As the external environment and the essential factors and natural advantages of China’s development have changed in recent years, international circulation, powered by markets and resources overseas, is visibly faltering. As China’s domestic demand continues to grow, our domestic circulation daily grows more robust. Objectively, the trend is that as international circulation weakens, domestic circulation strengthens. Much theoretical debate has been conducted regarding this objective phenomenon. We may further such research, and distill insights.
Since the global financial crisis in 2008, China’s economy has been moving toward making domestic circulation the mainstay. The ratio of current account surplus against GDP has decreased from 9.9% in 2007 to less than 1%, where it stands now. The contribution of domestic demand to economic growth has surpassed 100% in 7 years. The pattern of domestic economic circulation propelled by the domestic market will be even clearer in the future. The potential of domestic demand will continue to manifest in the form of economic growth. Therefore, we must adhere to the strategy of supply-side structural reform. Increasing domestic demand shall be a base point to shift production, distribution, circulation, and consumption further toward the domestic market. The supply system must be more adaptive to domestic demand, forming a higher-quality dynamic equilibrium in which demand leads supply, while supply in turn creates more demand.
- Translator’s note: The Party’s current (as of 2017) formulation of the “two centennial objectives” (两个一百年奋斗目标) is: (1) Form a well-off society in an all-round way (全面建成小康社会) by the centennial (2021) of the founding of the CCP; (2) establish a rich, strong, democratic, civilized, harmonious, beautiful modernized socialist superpower (社会主义现代化强国) by the centennial (2049) of the founding of the PRC.