A Look at China’s 14th Five-Year Plan

A Look at China’s 14th Five-Year Plan

On March 11, the National People’s Congress (NPC), China’s top legislature, concluded its annual session. In this meeting, the lawmakers approved, besides many other plans and policies, the Outline of the 14th Five-Year Plan (2021-2025) for National Economic and Social Development and the Long-Range Objectives Through the Year 2035. The Plan, which includes broad goals for China’s economic and social development over the next five-year period and through 2035, highlights a number of key strategic projects to be pursued as a priority.
Beyond the strategic infrastructure projects, the broader goal of the FYP and the 2035 outline emphasised establishing China’s self-sufficiency in key high-tech industries. While the FYP for the first time did not outline a growth target, it listed an annual target to increase R&D spending “by more than 7% per year”. It said China “will take self-reliance in science and technology as strategic underpinning for national development” and “will focus on the development of strategic emerging industries including information technology, biotech and new energy”. The plan said China “will implement a series of forward-looking and strategic major national sci-tech projects in frontier fields of artificial intelligence, quantum information, integrated circuits, life and health, brain science, gene technologies and clinical medicine.”
Innovation is one of the main components of the plan. Over the next five years, China aims to increase research and development (R&D) investment by seven percent each year, with a focus on basic research. This increased R&D investment, paired with continued reform of China’s innovation system, will play an important role in China’s development of advanced technologies listed in the plan, including artificial intelligence, biotechnology, blockchain, neuroscience, quantum computing, and robotics. China is betting that by “tackling problems at the frontier of science and technology,” expanding digital connectivity, and increasing data and computing power through the construction of new infrastructure, it will have successfully planted the “soil” to spur the growth of new technology applications, products and business models.
Main Targets
Here are some main targets for the 14th FYP period:
– Major economic indicators to be kept within an appropriate range, and annual targets for economic growth to be set in light of actual conditions;
– Surveyed urban unemployment rates of within 5.5 percent;
– An annual increase of R&D spending by more than 7 percent;
– An increase of permanent urban residents to 65 percent of the population;
– A reduction of energy consumption per unit of GDP and carbon dioxide emissions per unit of GDP by 13.5 percent and 18 percent, respectively;
– Raise average life expectancy by one year;
– Basic old-age insurance to cover 95 percent of the population.
Compared with previous FYPs, China didn’t set an average yearly GDP growth target this time but more focus on balanced and sustainable development with the domestic market as the mainstay.
The country’s FYP system is formulated to map out economic and social development over the next five years. The first FYP was launched in 1953, mounting to a total of 13 FYPs until today, except for a period of economic adjustment between 1963 and 1965.
Previous Five-Year Plans
China’s five-year plans are a series of social and economic development initiatives issued since the 1950s, which map strategies, put forward targets and set corresponding policy-making directions. They are an important way in which the Communist Party of China (CPC) governs the country.
In 1953, China drew up its first five-year plan when the country needed to build its capacity from scratch. The 1st Five-Year Plan (1953-1957) set out the basic task of laying the foundations of China’s industrialization and completing its socialist transformation. During that period, China successfully produced its first car, its first jet aircraft and the Wuhan Yangtze River Bridge. By the end of 1957, China’s total industrial output had increased by 128.6% compared with 1952.
In 1986, China drew up the 7th Five-Year Plan (1986-1990). This plan, devised after the reform and opening-up of China, included for the first time sections on “expanding external economic and technological exchanges” and “investment structure and policy,” and also placed the development of science and education in important strategic positions. During the 7th Five-Year Plan period, China’s economic system underwent major changes, with the Shanghai Stock Exchange starting operations in December 1990.
In the last five years (2016-2020) of building a moderately prosperous society in all respects, the 13th Five-Year Plan highlighted “innovation” and “reform.” It also set out key tasks including targeted poverty alleviation, construction of the Belt and Road Initiative, integration of Hong Kong and Macao into overall national development, and strengthened the crackdown on corruption. By the end of 2020, China’s GDP exceeded the threshold of 100 trillion yuan ($15.42 trillion). Meanwhile, the Fuxing bullet trains, Hong Kong-Zhuhai-Macao Bridge, C919 airplane, Chang’e-4 spacecraft, Beidou Navigation System and other achievements have become new icons of China.
China’s five-year plans can be said to have charted the path of national economic and social development, and recorded the entire process of the country’s growth.
From the 1st to 14th Five-Year Plan, China has been marching toward the same goal, that is, to achieve modernization. The consistency of targets, long-term decisions, stability and continuity of guidelines are distinguishing features of China’s governance system.
Now, the new 14th Five-Year Plan and the Long-Range Objectives Through the Year 2035 will lead the Chinese people toward building a great modern socialist country with a brighter future.