Chinese leader Xi Jinping delivered a speech on Monday on the opening day of a major meeting of the ruling Communist Party to approve a blueprint setting out China's goals for the next five years.
A brief statement by the official Xinhua news agency said Xi “presented the party leadership's proposals” for the next five-year plan for national economic and social development from 2026 to 2030. No details were provided.
The latest plan comes at a time of growing challenges and uncertainties for China, including a slow-growing economy, restrictions by other countries on its access to the latest technologies, and high tariffs on its exports by the United States.
A Xinhua editorial said the plan should focus on “high-quality” development and technological innovation, while ensuring national security is protected and the benefits of economic growth are fairly shared.
“There will be hardships and obstacles ahead, and we may face major tests,” the editorial said, referring to economic and national security goals. “We must be prepared to face a series of new risks and challenges.”
Analysts and investors are watching the meeting closely for clues about how the plan will balance economic and security interests and to what extent the plan will contain structural changes aimed at boosting consumption and managing an aging society.
This week's four-day meeting brings together about 200 voting members and 170 other members of the Communist Party's Central Committee.
The body will approve the draft five-year plan, but the details will likely not be made public until it is formally approved at the next annual legislative session, expected in March.
A plan with global implications
“Western politics works on electoral cycles, Chinese policy-making works on planning cycles,” pointed out Neil Thomas, a researcher in Chinese politics at the Asia Society Policy Institute, according to the BBC.
“Five-year plans show what China wants to achieve, signal the direction the leadership wants to go, and direct state resources toward these predefined outcomes,” he adds.
In the past, China's five-year plans have reshaped the global economy, writes the BBC, exemplifying three such moments.
1981-84: “Reform and Opening”
For nearly three decades, China's economy had been tightly controlled by the state. But Soviet-style central planning failed to increase prosperity, and many Chinese still struggled with poverty.
The country was still recovering from Mao Zedong's regime. The Great Leap Forward and the Cultural Revolution—campaigns led by the founder of Communist China to reshape the nation's economy and society—resulted in millions of deaths.
The country's new leader, Deng Xiaoping, said it was time to adopt some elements of the free market.
His “reform and opening” policy became a key part of the next Five Year Plan, which began in 1981.
The creation of free trade Special Economic Zones – and the foreign investment they have attracted – has transformed the lives of Chinese people.
By the 21st century, millions of Western manufacturing jobs had been outsourced to new factories in China's coastal regions.
Economists have called this phenomenon the “China shock” and it has been one of the driving forces behind the rise of populist parties in the former industrial areas of Europe and the United States.
For example, Donald Trump's economic policies — his tariffs and trade wars — aim to win back the American manufacturing jobs lost to China in recent decades.
2011-2015: “Strategic Emerging Industries”
China's status as the world's workshop was cemented with its accession to the World Trade Organization in 2001. But the Communist Party leadership was already planning its next move.
She was wary of the so-called “middle income trap.” This happens when a country with upward social mobility can no longer offer extremely low wages, but at the same time lacks the ability to create high-quality goods and services typical of an advanced economy.
So instead of limiting itself to low-cost manufacturing, China needed to turn to what it called “strategic emerging industries”—a term first formally used in 2010. For China’s leaders, that meant green technology like electric vehicles (EVs) and solar panels.
As climate change has become increasingly important in Western politics, China has mobilized an unprecedented amount of resources for these new industries.
Today, China is not only the undisputed world leader in renewable energy and electric vehicles, but also has a near-total monopoly on the supply chains of rare earths needed to build them.
China's control of these key resources—which are also crucial for chipmaking and artificial intelligence (AI)—now places it in a powerful position globally.
Beijing's recent move to tighten rare earth export controls has been labeled by Trump as an attempt to “hold the world captive”.
Although “emerging strategic forces” were enshrined in the next Five-Year Plan in 2011, green technology had been identified as a potential driver of growth and geopolitical power by China's then-leader Hu Jintao in the early 2000s.
2021-2025: “High Quality Development”
This might explain why China's five-year plans have more recently shifted their focus to “high-quality development,” officially introduced by Xi Jinping in 2017.
This means challenging American dominance in technology and placing China at the forefront of the sector.
Success stories like video-sharing app TikTok, telecom giant Huawei, and even artificial intelligence model DeepSeek are testament to China's tech boom this century.
But Western countries increasingly see this as a threat to their national security. Bans or subsequent attempted bans on the popular Chinese technology have affected millions of internet users around the world and sparked heated diplomatic disputes.
So far, China has fueled its technological success by using American innovations, such as advanced semiconductors from Nvidia.
With their sale to China blocked by Washington, it is expected that “high-quality development” will turn into “new quality productive forces” – a slogan introduced by Xi in 2023, which tilts the focus more towards the domestic market and national security.
That means putting China at the forefront of chipmaking, computer science and artificial intelligence — without depending on Western technology, and making it immune to embargoes.
Self-sufficiency in all areas, especially at the cutting edge of innovation, is likely to be one of the central tenets of the next five-year plan.
“National security and technological independence are now the defining mission of China's economic policy. It is a return to that nationalist project that underpins communism in China, to ensure that it is never again dominated by other countries,” points out Neil Thomas, a researcher of Chinese politics at the Asia Society Policy Institute.
