China's 2023 economic work priorities to facilitate high-quality development

BEIJING -- High-quality development once again came into the spotlight as its significance to China, the world's second-largest economy, was reiterated in a government work report at the ongoing two sessions, a crucial political event of the country.

"Policies ... should be carried out in a more coordinated way to create synergy for high-quality development," said the report submitted Sunday to the national legislature for deliberation. It proposed an economic growth target of around 5 percent for 2023 to ensure steady and quality development.

Toward this aim, the report, currently deliberated and discussed by national legislators and political advisors, lays out several priorities for this year's economic work as China is striving for the feat of modernization.

Unleashing domestic demand

Priority will be given to the recovery and expansion of consumption, according to the government work report, as the country eyes consolidating growth amid external uncertainties.

This is in line with China's efforts to foster a new pattern of development that is focused on the domestic economy and features positive interplay between domestic and international economic flows.

"China's super-size market has allowed us to tap the domestic potential when external uncertainties arise," said national political advisor Zhou Li'an, an economics professor at Peking University.

"The government needs to lead the efforts when there is downward pressure or insufficient demand," he said, citing several policy moves the report put forward, such as an elevated deficit-to-GDP ratio and 3.8 trillion yuan ($545.5 billion) of special-purpose local government bonds.

In a guideline released last December, China has also made long-term arrangements for domestic demand expansion for the years through 2035, pledging to address bottlenecks such as insufficient supply capacity and a distribution gap.

Efforts will include upgrading consumption quality, optimizing the investment structure, and promoting the coordinated development of urban and rural areas to release demand potential, it said.

Building modern industries

The government work report also called for accelerating the modernization of China's industrial system with a focus on key industrial chains in the manufacturing sector, so as to achieve breakthroughs in core technologies in key fields.

Pursuing high-quality development means that China should rely more on "the development of private enterprises, industrial upgrading and transformation, digital economy and high technologies," said Liu Shouying, dean of the School of Economics at Renmin University of China.

Over the past five years, China has doubled its spending on basic research, and the contribution of scientific and technological progress to its economic growth exceeded 60 percent.

Moving toward greater self-reliance in science and technology, China announced plans to restructure its Ministry of Science and Technology to better allocate resources to overcome challenges in key and core technologies. The setting up of a national data bureau was also proposed to advance the development of data-related fundamental institutions, and coordinate the integration, sharing, development and application of data resources, according to a reform plan of the State Council institutions.

Explaining the reform plan to national lawmakers, State Councilor Xiao Jie said that facing international sci-tech competition and external containment and suppression, China needs to further smooth its leadership and management system for science and technology-related work.

High-standard opening up

At the two sessions, China renewed its pledge to intensify efforts to attract and utilize foreign investment, vowing to expand market access and ensure national treatment for foreign-funded companies.

The country will take active steps to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and other high-standard economic and trade agreements, and steadily expand institutional opening-up, according to the government work report.

Gu Xueming, head of the Chinese Academy of International Trade and Economic Cooperation under the Ministry of Commerce, said foreign investment plays a vital role in high-quality development as it connects the domestic and foreign markets and resources.

Resilience, vitality and stability have made the Chinese economy both a safe haven and a growth driver for foreign investors, and this is why they will increase investment in China, said Gu, also a national political advisor.

Noting that China is a "vitally important market," Fernando Vallina, chairman of ExxonMobil (China) Investment Co Ltd said: "We believe that to be successful globally, it is imperative to be successful in China."