China has tough targets to meet before Xi's third term begins

Beijing [China], March 9 : A string of meetings of China's central leadership in the new year have expressed worries about the state of the country's economy. The leadership is now eager to contain any unrest over price rise and unemployment at a time when President Xi Jinping is poised to seek a fresh term of power later in the year.
The State Council of the Chinese Communist Party met last November. At the Council plenum, Premier Li Keqiang is reported to have said: "(China's) economy is currently facing new downward pressures and uncertainties have grown in number".
The Polit Buro of CCP's central meeting met in late February to discuss the draft Government Work Report. President Xi presided over the meeting. The report was delivered at the annual session of the National People's Congress on March 5.
Interestingly, Polit Buro skipped formal mention of two important issues. One, there was no mention of the Russian invasion of Ukraine or the fact that China abstained from United Nation resolutions condemning Russia. Two, the economic plight of the country was not mentioned in Polit Buro.
The only mention of the Ukraine crisis was made, extremely indirectly, in Premier Li's report to the State Council: "China will continue to pursue an independent foreign policy of peace, stay on the path of peaceful development, work for a new type of international relations."
The leadership took a similarly oblique way of addressing the unsettled economy. Its priority for 2022 was to "first ensure economic and social stability and then seek progress".
The priorities set for 2022 tell the real story. They are: Stabilise the economy through more robust macroeconomic measures; stimulate market vitality by deepening reform; implement the innovation-driven development strategy; expand domestic demand, and promote inter-region coordinated development and urbanisation.
Two other economic challenges, also indirectly mentioned, were rampant financial corruption and the challenges in implementing financial reforms. The central leadership discussed the issues and the Polit Buro decided to link "financial corruption, political supervision and financial sector reform as issues that should be tackled in an integrated way".
The Polit Buro repeated its stress on addressing developmental challenges in view of the crucial 20th CPC National Congress being convened this year-end. They include the following targets: "Completely, accurately and comprehensively implement the New Development Concept; accelerate the construction of a new development paradigm; comprehensively deepen reform and opening up; adhere to innovation-driven development; adhere to the mainline of supply-side structural reform; coordinate and plan the prevention and control of the (Covid-19) epidemic with economic and social development; coordinate and plan development and security; continue to improve the livelihood of the people; focus on stabilising the macro-economic situation.
Another indicator of the leadership's concern over the economy comes through its reiteration of the 'Six Stabilities' and the 'Six Guarantees' work. That relates to "stable employment, finance, foreign trade, foreign investment, investment and expectations, and guarantees for employment, basic livelihoods, economic entities, grain and energy security, industry supply chains and operations at the grassroots".
While the economic growth target was re-set at 5.5 per cent, the special economic targets for 2022 had an inherent political message that they should "prioritise stability while seeking progress".
The special targets were: "(To) increase the implementation efforts of macroeconomic policies to stabilise the economic situation; unwaveringly deepen reform to stimulate the vitality of market entities; deeply implement the innovation-driven development strategy; firmly implement the strategy of expanding domestic demand, and promote inter-region coordinated development and new-type urbanisation; firmly grasp agricultural production and promote the comprehensive revitalisation of the countryside; expand high-level openness to the outside world to promote the steady development of foreign trade and foreign investment.
For the first time in recent years, the Polit Buro issued clear policy guidelines that will oversee the path and pace of economic progress: "Guard against and resolve financial risks, and hold the bottom line of no systemic [financial] risks; earnestly guarantee and improve the people's livelihood, and strengthen and innovate on social governance, and strengthen the government's self-construction, strictly prevent and eliminate formalism and bureaucratism, and strive to complete the annual economic and social development goals and tasks."
The party leadership "realised" that many "salient problems" remained despite new achievements made in the financial sector. "Some of these problems are common in nature and must be earnestly addressed. We must concretise and reform the responsibilities of (these) entities, strengthen and reform day-to-day supervision, and solve one problem after another." It did not identify the problems but there was some indication of where the fault lay given the Polit Buro stressing the "need to strengthen the centralised and unified leadership of the Party Central Committee over financial work and unswervingly follow the path of financial development with Chinese characteristics".
The shortcomings were to be removed through the following measures: "Strengthen the atmosphere of the full and strict governance over the Party; implement the 'Two Responsibility' (Party committee has the main responsible while the commission for discipline inspection is responsible for supervision); strengthen the supervision of the 'Number Ones' (the top cadres in their respective organisations) and leading teams; conduct targeted rectifications to address typical problems such as the violation of the spirit of the Central Committee's eight-point decision (on improving Party and government conduct) and 'revolving doors' between politics and business; and conduct anti-corruption in an integrated manner so that (officials) dare not, cannot and do not want to be corrupt."