China’s Annual Political Event: Leaders Address Economic Challenges and Global Impact
Thousands of delegates from across China have gathered in Beijing for the start of the country’s most prominent annual political event, known as the “two sessions.” This event serves as a platform for Chinese leaders to address economic challenges and signal their plans for steering the world’s second-largest economy in the year ahead. The event is of heightened importance this year as China’s economy faces various challenges, including a property sector crisis, local government debt, deflation, a stock market rout, and tech friction with the US.
Chinese leader Xi Jinping and his top Communist Party officials are expected to project confidence during the days-long event. The gathering is highly choreographed and includes China’s rubber stamp legislature and top advisory body. However, this year’s event will see a significant break with tradition as the closing press conference with China’s premier has been scrapped. This move raises concerns about transparency around China’s policymaking and further diminishes the premier’s profile.
Under Xi’s leadership, the premier and the State Council, which functions as China’s cabinet, have been increasingly sidelined. The goal is to maintain one voice from the Communist Party and prevent other voices from diluting its control. This places more pressure on Xi as economic pain has sparked growing frustration within China. The gathering comes one year after Xi began his third term as president, consolidating power and stacking leadership positions with loyal officials.
While these challenges may not pose a threat to Xi’s power, how his team addresses them will have implications for China, its people, and the global economy. Policymakers, investors, and business owners worldwide will be closely watching the event, especially considering the strained relationship between China and the US. The Chinese government aims to use this platform to showcase that its economy is on the right trajectory and capable of handling economic issues.
The two sessions provide an opportunity for China’s government to broadcast its strategy for economic, social, and foreign policies. Key indicators, such as China’s economic growth target, budget deficit limit, and military spending for the coming year, are announced during this event. However, the space for exchanges between elite leaders and delegates has shrunk as Xi tightens ideological control and suppresses views that deviate from the Communist Party line.
Observers will be paying attention to how leaders discuss key issues such as China’s position on Taiwan, its relations with the US, and efforts to strengthen innovation. There is a possibility that Xi may adopt a more conciliatory stance towards the US and redirect efforts towards ensuring stability in China’s economy. This could be signaled by the appointment of a new foreign minister at the gathering.
The Chinese government is gearing up to focus on supporting economic growth in the year ahead. However, major stimulus measures are unlikely to be unveiled. Tactical measures aimed at boosting short-term confidence in the economy may be announced, but the underlying strategy of state-led development is expected to remain unchanged.
Premier Li is set to announce the economic growth target for 2024, with analysts expecting a relatively ambitious target of around 5%. Despite skepticism about the effectiveness of measures announced at the event, it is unlikely to dent Xi’s power. Popular approval is not crucial for Xi, as his focus is on elite control rather than winning elections. The country’s economic problems erode trust in the leadership’s ability to deliver higher growth, but the economy is far from collapsing.
In conclusion, China’s annual political event provides an important platform for leaders to address economic challenges and signal their plans for the future. The event comes at a critical time for China’s economy, which faces various challenges. While concerns about transparency and the diminishing role of the premier persist, Xi Jinping remains a powerful leader. The global community will be closely watching how China tackles its economic issues and navigates its relationship with the US.
