Economics
The highlights of China’s 2023 Central Economic Work Conference

December 22, 2023
Xinhua News Agency
Xinhua is the largest media organ in China. It publishes in multiple languages and is a channel for the distribution of information related to the Chinese government and the ruling Chinese Communist Party (CCP).
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It was pointed out at the conference that some difficulties and challenges must be tackled to achieve further economic recovery. Those include a lack of effective demand, overcapacity in some industries, weak social expectations and many hidden risks. There are bottlenecks in the domestic economic flow, and the external environment is increasingly complex, severe and uncertain. It is necessary to be vigilant against potential risks and effectively address these problems. Generally speaking, the favorable conditions for China’s development outweigh the unfavorable ones, and the overall trend of economic recovery and long-term improvement remains unchanged. Confidence and determination must be boosted.

We have also ensured both development and security and deepened understanding of how economic work should be done in the new era. It is imperative to uphold high-quality development as the unyielding principle of the new era, faithfully implement the new development philosophy on all fronts, and effectively improve the quality of our economy and promote its growth within a reasonable range. We must persist in deepening supply-side structural reform and focus on coordinated efforts to expand effective demand, leveraging the advantages of the vast market and robust production capacity, ensuring that the domestic economic flow is based on the proactive force of domestic demand, and improving the quality and level of international economic flow. It is crucial to strengthen the endogenous driving force for development through reform and opening up, ensure the advancement of both profound reforms and high-level opening up, continuously liberate and develop social productivity, and stimulate and enhance social vitality. We must maintain a healthy interaction between high-quality development and high-level security, with the former to promote the latter, and the latter to secure the former, and a dynamic balance must be maintained between both. Promoting Chinese modernization must be upheld as the foremost politics. Under the unified leadership of the CPC, we should unite the broadest masses of the people, and focus on economic development as the central task and high-quality development as the primary mission, gradually turning the magnificent blueprint of Chinese modernization into reality.

…adhere to the general principle of seeking progress while maintaining stability, and faithfully implement the new development philosophy on all fronts. It is also essential to accelerate the forging of a new development paradigm, focus on promoting high-quality development, comprehensively deepen reform and opening up, and build self-reliance and strength in high-level science and technology. It is imperative to intensify macro regulation, do a good job both in expanding domestic demand and deepening supply-side structural reform, ensure both new urbanization and rural revitalization across the board, and secure both high-quality development and high-level security. It is important to boost economic vitality, prevent and mitigate risks, improve social expectations, consolidate and promote the momentum of economic recovery, and effectively improve the quality of our economy and promote its growth within a reasonable range. It is important to improve people’s well-being, maintain social stability, and make further progress in building China into a strong country and realizing the rejuvenation of the Chinese nation through a Chinese path to modernization.

It was emphasized at the meeting that next year, it is necessary to adhere to the general principle of seeking progress while maintaining stability, promoting stability through progress, and establishing the new before abolishing the old. It will be essential to implement policies that are conducive to stabilizing expectations, growth, and employment. More efforts will be needed when it comes to taking proactive measures in transforming methods, adjusting structures, raising quality, and increasing efficiency, with a view to continuously strengthening the foundation for stability and improvement. It is imperative to strengthen counter-cyclical and cross-cyclical adjustments of macroeconomic policies, continue to implement proactive fiscal policies and prudent monetary policies, and enhance policy innovation and coordination.

Proactive fiscal policies should be appropriately strengthened and their effectiveness improved. We should make good use of fiscal policy to improve the efficiency of funds and the effectiveness of policies. We should optimize the structure of fiscal expenditures and strengthen financial support for major national strategic tasks. We should reasonably expand the scope of local government special bonds for capital purposes. We should do a good job in implementing structural tax cuts and fee reductions with a focus on supporting technological innovation and the development of the manufacturing industry. We should strictly supervise the transfer of payment funds and enforce financial discipline. We should strengthen fiscal sustainability and never cross the line in securing people’s basic livelihoods, salaries for the public sector and government’s operation at the grassroots level. General expenditures should be strictly controlled. Party and government departments should get used to working within a limited budget.

Prudent monetary policies should be flexible, moderate, precise, and effective. We should maintain a reasonable and sufficient liquidity level that matches the growth of social financing and the money supply with the expected targets for economic growth and price levels. We should make good use of monetary policy tools to improve their effectiveness, activate existing stocks, and guide financial institutions to increase support for technological innovation, green transformation, small and micro enterprises, and the digital economy. We should promote a stable and moderate decline in the overall cost of social financing. We should maintain the basic stability of the RMB exchange rate at a reasonable and balanced level.

We should enhance the consistency of macroeconomic policy orientation. We should strengthen coordination in fiscal, monetary, employment, industrial, regional, technological, and environmental policies, and include non-economic policies in the evaluation of the consistency of macroeconomic policy orientation. We should strengthen policy coordination to ensure consistent efforts and form synergies.

It was stressed at the meeting that next year we shall focus on promoting high-quality development, give prominence to key areas, grasp key points, and carry out economic work in a down-to-earth manner.

First, technological innovation will be promoted to support the development of a modern industrial system. We will promote industrial innovation through technological innovation, especially by using ground-breaking and cutting-edge technologies to foster new industries, new models and growth drivers, and develop new productive forces. We will improve the new national system for mobilizing nationwide resources, implement high-quality development actions for key industrial chains in the manufacturing industry, strengthen quality support and standard leadership, and boost the resilience and safety of industrial and supply chains. It will be essential to vigorously promote new industrialization, develop the digital economy, and accelerate the development of artificial intelligence. We will develop a number of strategic emerging industries such as bio-manufacturing, commercial aerospace, and low-altitude economy, open up new paths for future industries such as quantum and life sciences, and make extensive use of digital intelligence and green technologies to accelerate the transformation and upgrading of traditional industries. We will strengthen basic research in applied sciences and cutting-edge research, boost the principal role of enterprises in scientific and technological innovation, and encourage the development of venture capital and equity investment.

Second, we will focus on expanding domestic demand. It will be necessary to tap consumption potential and expand effective investment, so as to form a virtuous cycle between consumption and investment. We will shift consumption from post-epidemic recovery to sustained expansion, foster and expand new types of consumption, vigorously develop digital, green and health promotion consumption, and actively develop new consumption growth points such as smart homes, entertainment and tourism, sports events, as well as domestic products and China-chic goods. Efforts will be made to stabilize and expand traditional consumption, and boost spending on big-ticket items such as new energy vehicles and electronic products. We will increase the income of urban and rural residents, expand the size of the middle-income group, and improve consumption environment. To raise the standards of technology, energy and emissions, it will be necessary to promote large-scale upgrading of equipment and the replacement of old consumer goods with new ones. We will give full play to the multiplier effect of government investment, focus on supporting research in key and core technologies, new infrastructure, energy conservation, emission and carbon reduction, and cultivate new drivers of economic growth. We will improve investment and financing mechanisms, implement new mechanisms for cooperation between the government and private capital, and support private capital’s participation in new infrastructure and other areas.

Third, we will deepen reform in key areas. It will be necessary to plan major measures to further reform in all areas and inject strong impetus into promoting high-quality development and advancing Chinese modernization. It will be important to improve and implement institutions and mechanisms to unswervingly consolidate and develop the public sector and unswervingly support the development of the non-public sector and fully stimulate the endogenous power and innovation vitality of various business entities. We will deepen and upgrade the reform of state-owned enterprises to strengthen their core functions and core competitiveness. We will implement a number of measures in market access, access to factors of production, fair law enforcement, and protection of rights and interests to promote the development and growth of private enterprises. We will encourage small and medium-sized enterprises to increase their capacity to turn out products that are new, unique, specialized and sophisticated. We will speed up the development of a unified national market, strive to break down local protection and market segmentation, and reduce logistics costs. It will be necessary to plan a new round of reform of the fiscal and tax systems, and implement financial system reform.

Fourth, high-level opening up will be expanded. It will be imperative to foster new drivers of foreign trade, reinforce the stable performance in foreign trade and foreign investment, and expand trade in intermediate goods, trade in services, digital trade and exports of cross-border e-commerce. Market access in service industries such as telecommunications and healthcare will be further relaxed, and problems related to issues such as cross-border flow of data and equitable participation in government procurement shall be solved conscientiously in alignment with high-standard international economic and trade rules, so as to continue our efforts to foster a world-class business environment that is market-oriented, law-based, and internationalized, and promote the brand of “Invest in China.” Barriers shall be removed to make it easy for foreigners to do business, study and travel in China. Efforts will be made to ensure that the eight major steps China will take to support the development of high-quality Belt and Road Initiative are taken to the letter, and ensure that both major signature projects and “small yet smart” livelihood programs are promoted.

Fifth, risks in key areas will be prevented and defused in a continuous and effective manner. Coordinated efforts will be required to defuse risks in the real estate sector, local government debt and small and medium-sized financial institutions, and strict law enforcement is required to crack down on illegal financial activities, so as to ensure no systemic risks arise. Active and steady steps should be taken to address risks in the real estate sector, and reasonable financing needs for real estate enterprises under different ownership should be met equally to ensure stable and sound development of the real estate market. Efforts will also be accelerated to advance the construction of affordable housing and public infrastructure for both normal and emergency use and the renovation of shanty towns in cities. Relevant foundational systems will be upgraded to speed up the building of a new development mode for the real estate market. A balance will be struck between addressing local government debt risks and stable development, and major economically developed provinces should play a leading role in making greater contributions to the steady growth of the national economy.

Sixth, sustained efforts will be made to do a good job in the work related to agriculture, rural areas and farmers. With the goal of building up China’s strength in agriculture, it will be imperative to learn from and apply the experience from the Green Rural Revival Program, and advance rural revitalization in all respects in an effective manner. Work must be done to ensure national food security and ensure that no large number of rural residents become poverty-stricken again. Efforts must be made to promote the development of rural industries, rural areas and rural governance. At the same time, the strengths of science and technology and reform should be leveraged, and measures intensified to increase rural residents’ incomes, and strengths should be pooled to do things from which residents can get immediate benefits, so as to build a beautiful and harmonious countryside that is desirable to live and work in. No effort should be spared to secure the stable and safe supply of grain and other important agricultural products. Ways should be explored to build mechanisms on interest compensation between major grain production provinces and those that need supply of grain from other provinces. The system for offsetting cultivated land used for other purposes should be reformed and improved, and the standard for input in the cultivation of high-standard cropland should be raised. It will be imperative to adopt an all-encompassing approach to agriculture and food, and build China’s agriculture into a modernized major sector.

Seventh, we will promote integrated development of rural and urban areas and coordinated regional development. By combining new urbanization and comprehensive rural revitalization, we will facilitate the two-way flows of various production factors and promote the new urbanization centered on county seats to generate a new mode of integrated urban and rural development. We will carry out urban renewal projects and improve urban infrastructure to build livable, resilient, and smart cities. We will give full scope to the comparative advantages of various regions and, by following the main functional positioning, actively serve the forging of a new development paradigm. We will improve the distribution of major productive forces and strengthen the construction of national strategic hinterland. We will develop the marine economy, and step up efforts to build China into a strong maritime country.

Eighth, we will further strengthen ecological conservation and pursue green and low-carbon development. We will set up model zones for building a Beautiful China and create hubs for green and low-carbon development. We will work actively and prudently toward the goals of reaching carbon emissions peaking and carbon neutrality, and accelerate the building of a green and low-carbon supply chain. We will make sustained efforts to keep our skies blue, waters clear, and lands clean. We will improve mechanisms to realize the market value of ecosystem goods. We will deepen the reform of collective forest tenure. We will speed up the planning and development of a system for new energy sources, conserve resources of all types and use them efficiently, and ensure greater security of energy and resources.

Ninth, we will make down-to-earth efforts to secure and improve people’s livelihoods. We will do everything within our capacity and our means to make sure that people’s livelihoods are secured. Employment will be given priority to ensure employment of key groups. We will build a solid social security net and improve the multi-tiered and categorized social assistance system. We will speed up the improvement of policies to boost birth rates and promote the silver economy for high-quality population development.

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Xinhua News Agency
Xinhua is the largest media organ in China. It publishes in multiple languages and is a channel for the distribution of information related to the Chinese government and the ruling Chinese Communist Party (CCP).
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