What Did Communist China ’s Central Economic Work Conference Say?

Sources: XinHua Net; December 18, 2020

Translator/Reviewer: ThomasH; Proofreading: Bluesky; Page: Rain

Briefing:

The People’s Republic of China (PRC)’s Central Economic Work Conference was hosted in Beijing from the 16th to 18 Dec 2020. During the 3-day annual economic conference attended by the Chinese Communist Party (CCP)’s top officials and military and judicial leaders, new agendas were laid out for the Chinese economy in 2021 and beyond.

Specifically, eight main tasks were assigned to the CCP delegates, covering technological innovation, supply chain, domestic demand, economic reform, seeding/farming, anti-monopoly laws, housing, and carbon neutrality. Notably, the CCP leadership pointed out that China must strengthen its supply chain and expand domestic demand, seemingly a response to the continuously escalating political tension and the resulting trade war between China and western countries such as the US and Australia. The leadership also appeared to recognize the housing bubble in China, where much of the new real estate developments are left empty as they were purchased purely as investments. However, the proposed solution is somewhat unusual – to build more housing but for “rental purposes.” The CCP leadership also emphasised the importance of “ensuring food supply and security”, seemingly to prepare for an upcoming food shortage in China that the CCP strenuously refuses to acknowledge.

Most importantly, President Xi doubled down on the importance of having CCP’s leadership and supervision in all industries and enterprises, both state-owned and private. To quote from the conference synopsis, “the leadership role of the CCP must be strengthened comprehensively; we (CCP) must become proficient at analyzing social-economic issues from a political perspective, and strive to rigorously execute our Central Committee’s policies in every aspect of the economy.”

Below are excerpts from that report:

Xi Jinping, general secretary of the Communist Party of China Central Committee, Chinese president and chairman of the Central Military Commission, speaks during the annual Central Economic Work Conference in Beijing, capital of China. (Xinhua/Huang Jingwen)

Xinhua News Agency reported on 18 Dec 2020: The People’s Republic of China (PRC)’s Central Economic Work Conference was hosted in Beijing from the 16th to 18 Dec 2020. Xi Jinping, who is the general secretary of the Chinese Communist Party (CCP), the president of the PRC and the chairman of China’s Central Military Commission, Li Keqiang, who is the premier of the PRC and a member of the Politburo Standing Committee of the CCP, and other members of the Politburo Standing Committee including Li Zhanshu, Wang Yang, Wang Huning, Zhao Leji, and Han Zheng attended the meeting.

The following “key tasks” were assigned to the CCP delegates in the upcoming year (2021) during the conference.

Task 1: to strengthen our (refers to China led by the CCP in this report) “strategic technology power.” Firstly, we have to utilize the CCP’s role as an organizer for the country’s vital technological innovations, adhere to the guidance based on strategic requirements, determine the focuses and directions of technological innovations, and pay particular attention to solving the major obstacles surrounding China’s national security and economic development. Secondly, we have to take advantage of China’s single-party “whole nation” system by fully utilizing the “national teams” within the top universities and national institutions and promoting the optimization of scientific research force distribution and resource sharing. Furthermore, we must promptly formulate and implement a ten-year action plan for fundamental research, focusing on deploying a number of research centers for fundamental science subjects, and supporting the establishment of international and regional scientific and technological innovation centers in regions with sufficient resources. We also need to recognize the importance of enterprises in technological innovation, encourage industry-leading enterprises to form innovation consortiums and promote innovative exercises in small and medium-sized firms. It is essential to promote international scientific and technological exchanges and cooperation and speed up the training of domestic talents so that more outstanding young talents can stand out. We need to refine the nation’s “incentive scheme” and evaluation mechanism for new technologies and implement the “revealing the capable” scheme. Finally, we need to standardize science’s morality, establish an upbeat style of studying and researching, and guide our scientists and researchers to work hard, concentrate, perform, and make progress.

Task 2: To enhance the degree of autonomy of the industrial supply chain. Firstly, the industrial supply chain’s security and stability are the foundations for establishing a new economic development framework. We need to match the progress of improving our shortcomings and reinforcing our advantages by simultaneously implementing targeted problem-solving projects in our comparably weak industries, resolving “bottleneck” problems as soon as possible, and cultivating and developing more advanced technologies in our traditionally more robust industries. Secondly, we must implement an infrastructural reengineering project in our leading industries so that we can lay a solid foundation for the construction of basic components, the refinement of established manufacturing techniques, and the manufacturing of raw materials. Lastly, we need to enhance our high-level industrial designs further, guiding various applications, leading the industry as a whole, and promoting share technologies, thereby effectively executing the “quality improvement movement”.

Task 3: to stick to the fundamental strategy of increasing domestic demand. The formation of a robust domestic market crucially supports establishing a new economic development framework. It requires appropriate institutional arrangements being made to guide the spending, savings, and investments of citizens rationally. The most fundamental methods for promoting consumer spending are to create more employment opportunities, improve social security, optimize income distribution, grow the size of mid-income groups, and promote “common prosperity” amongst citizens. We must combine the promotion of consumer spending with the betterment of the citizens’ quality of life. This calls for the graduate removal of certain regulatory restrictions on consumer purchases and the realization of towns and villages’ consuming power. We also need to improve the vocational and technical education system to achieve more and higher-quality employment. We have to appropriately bring up public spending and increase public service expenditures for education, medical care, pension, and childcare. We should further capitalize on our influence on the market to enhance return on investments. We must guide and leverage investments from the centralized budgeting system on industries with strong spillover effects and more social benefits while encouraging the society to invest more. In particular, we need to focus on developing the digital economy and invest more in new infrastructure, manufacturing equipment renewal, and technological transformations. We have to execute our plans to renew cities, speed up the reconstruction of old towns and communities, and establish a modern logistics system. Finally, we need to reinforce our centralized planning and high-level guidance, map the industrial layout, and avoid repeated development of emerging industries.

Task 4: to comprehensively push for Chinese economic reform. To build a new economic development framework, we have to construct a high-standard “socialist market economy” system, effectively open up our economy, and push for the synergy between reform and opening up. We need to refine our macroeconomic governance and enhance international macroeconomic policy coordination. We must rigorously implement the three-year reform plan regarding state-owned enterprises, improve the economic environment for private enterprises, perfect the modern enterprise system and corporate governance, and simulate the major industries. We need to allow more access to the market, promote fair competition, protect intellectual property rights, construct an overall unified market, and create a business environment that is market-oriented, law-protected, and internationalized. We also have to tighten our supervision on financial institutions, promote the healthy development of the capital market, improve our public companies’ quality, and punish all types of debt evasion. We need to standardize the development of Pillar 3 pension insurance (private pensions). Active considerations should be given to joining the Comprehensive and Progressive Trans-Pacific Partnership Agreement. Finally, we need to enhance the capacity and quality of domestic regulatory governance vigorously, perfect the security reviewing mechanism, and focus on protecting national security by following internationally-accepted rules.

Chinese Premier Li Keqiang, also a member of the Standing Committee of the Political Bureau of the Communist Party of China (CPC) Central Committee, speaks during the annual Central Economic Work Conference in Beijing, capital of China.(Xinhua/Huang Jingwen)

Task 5: to solve the issues surrounding seeding and farming. We must ensure food security, emphasizing strategies for the productive application of farmland, and agricultural technologies. The state must reinforce the protection and utilization of germplasm resources and the construction of seed banks. The industrial application of biological breeding programs must be set in motion under highly scientific and stringent regulations. We must achieve a turnaround in our seeding industry by tackling the “bottleneck” technologies. We have to ensure that the country’s farmland remains at or above the red line of 120 million hectares by strictly prohibiting the urbanization of farmlands and balancing farmland requisition and compensation. We must build a secure national industrial belt for food production, reinforce high-quality agricultural construction, enhance water irrigation work on farmlands, and execute the protection projects for farmlands in Dongbei. Finally, we must increase our production and supply capacity for food and important agricultural products and tackle agricultural pollutions.

Task 6: to strengthen antitrust/anti-monopoly laws and prevent the unregulated expansion of capitals. Preventing monopoly and unfair competition are intrinsic requirements for perfecting our “socialist market economy” system and promoting high-quality development. Our country endorses innovation and development amongst enterprises to increase their international competitiveness; we also endorse the parallel development of state-owned and private enterprises while promoting standardised regulations and law rules. We need to refine the laws and regulations surrounding the monopoly assessment of platform enterprises, the collection and application of data, consumer rights protection, and more. Monopoly and unfair competition must be tackled with the resolution by tightening regulations and enhancing our supervision capacities. Financial innovations must be carried out under meticulous inspections and regulations.

Task 7: to solve the housing issue in major cities. The housing issue direct affects people’s livelihood. We must adhere to the concept that houses are primarily for people to live in rather than means for investments. We shall design a variety of adaptable strategies to stimulate the healthy development of different types of real estate markets in China. We must highlight the establishment of guaranteed rental housing, expedite perfecting long-term rental policies, protest the equal rights between tenants and homeowners in terms of using public services, and standardize the regulations regarding long-term rental markets. Furthermore, rental housing should be prioritized for public land distribution and planning. We should also explore the possibilities of utilizing public construction areas and unused entrepreneurial lands to construct more housing for rental purposes. Both state-owned and private enterprises will have to contribute to the project. Lastly, we must reduce the tax contributions for rental housing, regulate the rental market and transactions, and adjust the average rental prices to an appropriate level.

Task 8: to reach peak carbon emission and carbon neutral status as soon as possible. Our country intends to reach a peak for carbon emission before 2030 and realize a carbon-neutral status before 2060. We must formulate action plans to ensure that we reach carbon emission peaks before 2030 as soon as possible, with regions that have more resources to spearhead the movement. We must pick up the pace on optimizing industrial and energy consumption structures so that we can reach the peaks for fossil fuel consumption as early as possible. We must also support the development of renewable energies, accelerate the establishment of the energy consumption and carbon emission rights market, and complete the mirroring regulations on energy and consumption. The fight against pollution must be won – the reduction of pollution and carbon emission will work hand-in-hand. We will set up a large-scale nation-wide afforestation program to increase our ecological systems’ carbon digestion capacity.

As highlighted in the conference, after generations of continuous and consistent effort, our country is on the verge of reaching comprehensive prosperity. We must persist as this marks the starting point of a new life and a new fight. We have to consolidate on the achievement we made in alleviating poverty and prevent its return on any scale. We also need to strengthen the relationships between neighboring towns and villages and reinforce policies that encourage their synergetic developments to achieve macroscopic stability, optimize economic classifications, and allow ample time for policy transition.

It was emphasized in the conference that, to maintain our designated economy, the government must execute the “six stables” and the “six guarantees” by appropriately adjusting the rhythm and intensity of macroscopic economic and political adjustments so that the country can accurately execute the CCP’s macroscopic strategies. We must continue to stimulate the leading industries, encourage financial services that benefit the general public, refine tax reduction policies, strive for economic reform, and vitalize the market, particularly the small and medium-sized businesses, and individual merchants. We need to rely on innovation to boost the development of the real economy and encourage the manufacturing industry’s high-quality advancement. We have to fully realize the potential of our domestic market, using the betterment of our society as guidance to increase consumer spending and productive investments, and refine the policies and mechanisms to support the involvement of private capitals, with particular focus on fixing the shortcomings on public facilities, coordinating regional collaborations, and promoting the urbanization of towns and villages. We must push for the revitalization of rural areas, enhance agricultural production, and promote rural area reform and reconstruction. We have to enforce the social and economic reform of critical areas and processes, push for the “simplify, supervise, service” reform, and continue optimizing the business environment. We need to work harder to prevent and treat pollution so that we can consistently improve our ecological environment. Finally, we must focus on guaranteeing citizens’ basic livelihood, promoting multi-channel employment amongst the key populations, and continuously improving people’s living standards.

The conference emphasized that for the country to adapt to a new stage of development, implement new development concepts, and construct a new development framework, the leadership role of the CCP must be strengthened comprehensively and that the CCP must become proficient at analyzing social-economic issues from a political perspective and strive to rigorously execute the Standing Committee’s core policies in every aspect of the economy. Inspection and supervision must be carried out accordingly to the law and effectively. The leadership on all levels must improve their professional skills and strive to construct a new development framework. We must feel the urgency to learn and improve to catch up on the current trends. We have to focus on the two key areas of work, which are development and safety, effectively alleviate and prevent all types of social-economic risks, pay special attention to manufacturing safety and the mitigation of natural calamities, and eliminate the possibility of potential catastrophes. We must continue to supervise and regulate our society and harshly prosecute all criminal activities. We must not neglect the continuous fight against Covid-19 as we must simultaneously prevent the influx of viruses from foreign countries and stop another virus rebound domestically. Lastly, we must ensure that the supply chain functions normally during the upcoming New Year and Chinese New Year, protect basic livelihood, and carry out poverty relief work for citizens in need.

The conference calls for all CCP members’ unity to follow the party’s leadership, spearheaded by comrade Xi Jinping. We must unite, explore, and pioneer so that we can welcome our party’s 100th birthday with success and victory. We must fight unremittingly to build a modern socialist country comprehensively and to achieve the China Dream of great rejuvenation.

The conference was attended by members of the Politburo of the CCP, secretaries of the Secretariat of the CCP, leaders, and comrades of the Standing Committee of the National People’s Congress, members of the State Council of the PRC, president of the Supreme People’s Court, president of the Supreme People’s Procuratorate, leaders and comrades of the National Committee of the Chinese People’s Political Consultative, and members of the Central Military Commission.

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