(Bloomberg) -- President Xi Jinping just delivered China’s most authoritative policy blueprint for the next five years at a Communist Party congress where he’s set to clinch a third term in power.
During a nearly two hour-speech, Xi laid out the ruling party’s priorities on everything from Covid Zero to its ambitions on Taiwan and goals for tech sufficiency.
Here’s how the experts are reacting:
Neil Thomas, a China analyst at Eurasia Group:
“Xi changed the structure of the report fairly significantly compared to previous years. There are new sections on science and education, on national security and on the legal system areas that have previously been addressed in other parts of report. Having these new sections means they’re going to be even higher priorities.
“The new focus on science and education is a reflection on just how much Xi is betting on innovation as a solution to China’s economic problems and its reliance on Western technology. I think that’s super significant.
“What’s new there is the addition that this would be done by using or done through Chinese-style modernization. That’s a strong sign Xi is sticking to his guns in going his own way toward wealth, power and very much not following the ways of the West.
“The message for the United States is that China’s going to do its own thing. The message to the rest of the world is that China is going to remain powerful and is going to remain a potential partner, especially for developing countries.”
Scott Kennedy, senior adviser and trustee chair in Chinese business and economics at the Center for Strategic & International Studies:
“The language of this speech is all about trying to establish a different kind of international system from what we’ve seen since World War II -- one led by the US emphasizing free markets and through the UN system, multilateralism and democracy.
“And you can see the whole emphasis of this speech an emphasis of a Chinese style everything -- China’s foreign policy, domestic policy, and, in some ways, an acceptance of the fact that the US and China are strategic competitors in the type of world order they’re trying to create. And he was not backing down from that at all.
“So I think we’re seeing a real effort for the Chinese to say, ‘You know what, we still want to participate in this global society but we want to be rule makers not just rule takers.’”
Peiqian Liu, chief China economist of Natwest Markets:
“There were two parts that are important to the medium term. First, there was a balanced emphasis on both development and security. This means growth rates will no longer be the only and top priority in coming years, security of development also matters.
“Second, there was a lot of emphasis on technology and innovation, which means the focus will likely shift away from just lowering financial risks and reducing debt growth to pouring more resources to development of high tech and innovation.
“Common prosperity is still highlighted. That means the policy goal of redistribution of income and wealth is still a medium term goal.”
Wu Xianfeng, fund manager at Shenzhen Longteng Assets Management Co:
“The standout of the speech was that Xi emphasized economic development still remaining the priority, contrary to the jitters and misconceptions prior to the meeting that common prosperity would come first.
“It’s reassuring the leaders say growth still comes first and foremost in the current stage of development, especially as we are faced with economic difficulties from virus curbs and as we are in for challenges from the US over the long term.”
Ding Shuang, chief economist for Greater China and North Asia at Standard Charted Plc:
“It’s important that he reiterated that development is the first priority, and that modernization can’t be achieved without the material foundation. That means the economy’s size still needs to expand and the quality needs to improve.
“The speech is mostly an extension of Xi’s previous thoughts on the economy, and there aren’t much new ideas. That’s understandable because he has helmed development in the past decade.
“The speech itself may not have much impact on the market, because most of the points have already been raised in the past.”
Frank Tsai, lecturer at the Emlyon Business School’s Shanghai campus:
“Xi’s speech sends a signal that China is serious about its socialist roots. To paraphrase, Xi stated that China offers a ‘new choice for humanity,’ China’s ‘scientific socialism,’ and that ‘Chinese wisdom and capacity’ will make this model work for the benefit of all. This sounds like boilerplate propaganda, but it is serious. China is the last major country standing with Cold War roots in Soviet communism.”
Alfred Wu, associate professor at the National University of Singapore’s Lee Kuan Yew School of Public Policy:
“From his speech, it’s clear he’s the leader of the world’s number two country; he wants to change the world order. So China’s clash with the US will be intensified. I don’t see any possibility of tensions being lowered.
“China has always argued that the US made the current world order, but now they are doubling down on how they present a true alternative world.
“Xi emphasized and boosted the narrative of national security because it is serving as a justification for him to remain in office for as long as possible. He won’t tolerate sensitive issues that could jeopardize his regime.”
Chen Shi, fund manager at Shanghai Jade Stone Investment Management Co.:
“The report settled my nervousness over the past weeks, and should assuage concerns of those investing in China. The fact that the report is shorter this time says to me that the party is confident and policies are consistent -- it doesn’t feel the need to waste words explaining itself, and that the overall direction in policies remains the same, and iterated in various policy blueprints in the past.
“The way that development and technology came so high up in the report also is reassuring to me -- this party is not just about ideology, as some were beginning to fear, but development and economic stability stays high on the list. Those words coming out the mouth of the man himself means that China will still be full of investment opportunities.”
Drew Thompson, visiting senior research fellow at the Lee Kuan Yew School of Public Policy at the National University of Singapore:
“It’s interesting how Xi characterizes China’s response to the dynamic international situation as a ‘struggle’ in the Marxist sense for its own national and political security. He is calling on the nation to struggle against international forces that threaten China’s interests.
“It reflects an adversarial world view that is zero-sum, and likely foretells of continuing tensions between China and developed nations, featuring wolf warriors and coercion in multiple domains -- diplomatic, economic, informational, and military.
“Xi emphasized the importance of the country gaining in strength, and the need to struggle against challenges and threats to the party and country, which requires not only a modern military, but a ubiquitous domestic security apparatus as well.”
Baohui Zhang, a professor of political science at Lingnan University in Hong Kong:
“Xi’s speech re-emphasized China’s commitment to ‘openness,’ which was started by Deng Xiaoping. Many have wondered if the strategic rivalry between China and the United States could push them apart and motivate China to pursue autarky. Xi’s message is to assure the world the China remains committed to economic integration with the world.
“However, this may not impact the Sino-US rivalry in significant ways. Washington is pursuing at least limited decoupling to redefine its relations with China. Recent technology denial measures are the latest evidence. As such, China’s commitment to ‘openness’ does not mean that decoupling will not continue ,as Washington’s choices and strategies also impact their relations.”
Wen-Ti Sung, a political scientist at Australia National University’s Taiwan Studies Program:
“By giving Taiwan the spotlight early in his speech, Xi is committing the performance of his Taiwan policy to be put under the microscope over the next five years.
“Xi declared the Chinese military has both the capability and resolve to deter external influence over Taiwan. What he still hasn’t said is if Chinese ‘intent’ to do so.
“In that sense, China is still preferring peaceful unification to using force, but the focus on military capability will only accelerate an arms race in the Taiwan Strait, and the need to demonstrate resolve through military exercises will both raise tensions and increase risks of accidental escalation.”
©2022 Bloomberg L.P.
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