The Chinese People’s Political Consultative Conference (CPPCC) and the National People’s Congress (NPC) have recently concluded their sessions. The NPC, which is China’s top legislative body, convenes annually to discuss and vote on key national policies, enact laws, and appoint key government officials.
Meanwhile, the CPPCC serves as a political advisory body and plays an important role to build consensus.
Together, these two bodies involve in the shaping of China’s governance and policy direction, providing platforms for political discourse and public participation.
Members of the NPC are elected through a multistage electoral process that begins at the local level. Though not elected to the National Congress, they are truly voted by the citizens to represent their local regions or a grassroots level branch of an industry. These representatives, in turn, nominate candidates for higher-level People’s Congresses, creating a hierarchical structure of electoral bodies finally to the national level. This is China’s form of democracy.
Currently, both the CPPCC and NPC serve five-year terms. Each term includes annual sessions where delegates convene in Beijing. This year marks the inaugural sessions of the 14th CPPCC and the 14th NPC.
The economic difficulties
Economy is always one of the central topics of the sessions. After a year of difficult recovery in the post pandemic era, it might be even more prominent.
China’s economy has indeed been a powerhouse in recent decades, consistently achieving impressive growth rates that have propelled it to become the world’s second-largest economy. However, sustaining such high growth rates becomes increasingly challenging as an economy evolves and faces structural constraints even well before the geopolitical competition turning white-hot.
During the pandemic, CCP implemented the dynamic zero-covid policy under the slogan‘Life First’. At first, it helped the community avoid facing the virus without effective vaccines and kept the economy running smoothly.However, as the virus evolved to become more infectious, the dynamic policy had to shift to a rigid one, inadvertently harming the economy.
Then the real estate and the education industries were targeted with the strict regulations. In the long run, it’s appropriate to adapt the development models of the industries. However, the policy changes were implemented during a delicate phase of recovery from the pandemic. Finally, the leadership indirectly acknowledged the policy’s shortcomings by emphasizing the need to avoid the so-called ‘fallacy of composition’ in the future.
And taking a global view, the geopolitical competition is poised to intensify further. More technological blockade measures could be expected.
The ‘new productive forces’
Under all that circumstances, it is important to raise the productivity internally. Chinese researcher and enterprises have applied tons of patents, but how to make them become real productive forces?
While new technologies, especially the digital technologies such as AI, 5G and block chains, hold tremendous potential to transform various sectors, their adoption and integration into the economy may indeed be a gradual process, with tangible effects limited to certain industries in the short to medium term.
It should also be recognized that technological transformation often unfolds unevenly across sectors and regions, influenced by factors such as infrastructure readiness, regulatory environment, and market dynamics. While some industries may experience rapid transformation and productivity gains, others may lag behind or face significant challenges in adapting to new technologies.
The ‘new productive forces’ was proposed and emphasized so that the industries would drag more resources to accelerate the effective adoption of the technologies.
Frankly, it doesn’t mean that China has the answer of creating ‘the new productive forces’, it is a top-level call for seeking the answer.
It doesn’t serve for the 5% growth target of this year, either. It focuses on at least the next 5 years or even longer.
Well, the transition to a more digitally-driven economy might have some implications for employment, as automation and AI-enabled technologies reshape the nature of work and skills required in the labor market. It is predictable that some individuals could face displacement or job transitions in the future. On the other hand, China’s government has demonstrated that it always has a proactive approach to addressing employment challenges through targeted policies, investment in infrastructure, and support for entrepreneurship and innovation. And the rural communities provide a potential buffer against significant unemployment.
Leveraging its vast human capital and resources, China has the potential to mitigate the negative effects of technological disruptions and harness the opportunities presented by the new productive forces to drive inclusive growth and prosperity.
Indeed, a 5% annual growth target would still be commendable for a country of China’s size and complexity. Achieving this target would not only benefit China but also have positive spillover effects for the global economy, given China’s pivotal role as an engine of global growth.
And how about the ‘new productive forces’? The practice of integration technologies would also be beneficial to other countries. There might be chances to learn to catch up the developed countries by so called ‘Passing on a curve’. Even lessons in China would be priceless.
As we conclude this article, let’s revisit the function of the two sessions. It’s highly unlikely that a delegate proposed the concept of ‘new productive forces’ and captured the attention of colleagues for discussion. In fact, the phrase was first introduced by Xi Jinping last September. The CCP actually leads the CPPCC and the NPC and it clearly states that. The proposal and the following discussion of the ‘new productive forces’ could be viewed as an example of the leadership of the party and the ‘democratic centralism’.
The ‘democratic centralism’ might be not familiar to those who lived under a western ‘democratic’ system. However, I believe it holds a key to understanding China’s success.
