From October 16-23, the Communist Party of China (CPC) will complete its once-in-a-decade leadership change at the upcoming 20th National Congress of the CPC. Sixty percent of China’s top decision-making Politburo will be re-elected.
CPC General Secretary Xi Jinping will deliver a report on October 16, outlining China’s major development priorities for the next five years.
Foreign businesses should closely monitor the staffing of the Politburo’s new economic leadership team and the Party’s long-term vision for China’s economic and social development, foreign affairs and zero-COVID policy.
POINTS TO WATCH
The Party Congress work report is a comprehensive policy blueprint, providing insights into China’s development priorities. The document summarizes the work of the previous five years, states the Party’s evolving ideological foundations and outlines a development agenda encompassing economic, political and social development, as well as sustainability, national security, sovereignty and foreign affairs. Below are the primary issues expected to be highlighted in the report:
- Economic Development: The Party will likely reiterate the market’s decisive role in resource allocation, but also emphasize the government’s role in guiding economic development, particularly in building a unified domestic market, strengthening supply chain resilience and promoting indigenous innovation. Xi’s reappointment also indicates long-term development commitments, including decarbonization, digitalization and rural revitalization, and reaffirms further integration of the regional economy, which will continue to impact MNCs’ operations in China.
- Foreign Affairs and Sovereignty: Following the passage of the National Security Law in Hong Kong, the CPC will underline the mainland government’s full jurisdiction and supervision. Xi will also emphasize the importance of “one country, two systems” for Taiwan and the 1992 Consensus in China’s reunification strategy. Another key point to be covered is the promotion of China-led multilateral initiatives such as the BRI, RCEP and the new Global Security Initiative (GSI).
- Social Development: Xi is expected to elaborate on the Party’s strategy for promoting common prosperity, which was announced in 2021 in response to rising social and economic inequality. Beijing has opposed egalitarianism while highlighting middle-income group expansion and domestic consumption growth. Therefore, focus will remain on economic growth and wealth distribution, which has been described as “making the pie bigger before dividing it.”
- Zero-COVID Policy: There has been much talk about the possibility of China abandoning its zero-COVID policy following the congress. However, state-run media’s recent reiteration of the necessity of the policy indicates that no major shifts are likely to occur immediately after. The policy will likely remain in place at least until after the National People’s Congress in March 2023. Even after March, no sudden U-turn should be expected. The government will continue to proceed with great caution and adjust control measures gradually.
Read APCO’s full outlook of the 20th Party Congress below and click here to download a copy.