China Briefing

China’s New Leaders’ New Economic Plans

Executive summary

  • China has new economic leaders and a new focus. The recently-concluded 20th Party Congress changed the personnel for who will be running the world’s second-largest economy, and December saw the release of the Party’s plans for the economy in 2023.
  • So now we know more about how Xi Jinping sees his third term in office, and how that will also change China’s economic policy. The first policy signals are a focus on more economic growth, with the role of private enterprises reaffirmed.
  • There has also been clarification on what common prosperity is to mean: a more equal distribution of capital rather than a blocking of the accumulation of capital.
  • While private companies, tech firms, and foreign capital are all far more welcome, implementation will be difficult. Challenges remain in encouraging consumption and bridging long-term structural divides of place and human capital. Changing China is never easy.