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Economic Daily published economists' interpretation of the 14th Five-Year Plan and the outline of 2035 long-term goals

The Fourteenth Five-Year Plan and the Outline of the long-range goals for 2035 have taken into account both domestic and international development trends and China's development conditions for the coming period, firmly grasped the principal contradiction in China's society, thoroughly applied the new development philosophy, and formulated systematic plans and strategic arrangements for national economic and social development in the next five and 15 years.


How to fully understand the scientific nature, rationality, systematicness and comprehensiveness of the 14th Five-Year Plan and the outline of the long-term goals for 2035? What new ideas and requirements have been put forward in the Outline? What impact will it have on the future development of China's economy? The Economic Daily asked five economists to interpret it.


Comprehensively and accurately grasp the "three new" logic main line


As programmatic documents guiding national economic and social development in the next five and 15 years, the 14th Five-Year Plan and the Outline of 2035 Long-range Goals define the guiding ideology, main objectives, key tasks and major measures for economic and social development during the 14th Five-Year Plan period. The main logical line that runs through the Outline of the Plan is "three new developments" : a new stage of development, a new concept of development, and a new pattern of development. The new stage of development is a new journey to build a modern socialist country in all respects; the new vision of development is one that calls for innovative, coordinated, green, open and shared development; and the new pattern of development is one in which domestic cycles play a dominant role and domestic and international cycles mutually reinforce each other.


This new stage of development answers the question of where we are and where we are heading. Over the past 40-plus years of reform and opening up, from the Sixth Five-Year Plan to the 13th Five-Year Plan, we have all been striving to achieve a moderately prosperous society. The 19th National Congress of the Communist Party of China made strategic arrangements for realizing the second centenary goal, which called for basically realizing socialist modernization by 2035 and building China into a great modern socialist country that is prosperous, strong, democratic, culturally advanced, harmonious, and beautiful by the middle of the century. The 14th Five-Year Plan is the first five-year plan to build a modern socialist country in an all-round way and march towards the second centenary goal, which is the historical mission and basic positioning of the 14th Five-Year Plan. The new stage of development is a historic leap from building a moderately prosperous society in all respects to building a modern socialist country in all respects.


In this new stage of development, China's development environment is facing profound and complex changes. In terms of the external environment, the world today is undergoing profound changes unseen in a century. The international environment is becoming more complex and destabilizing and uncertain. In terms of the internal environment, the Chinese economy also needs to continue to cope with many risks and challenges if it is to achieve high-quality development.


The new development concept answers the question of "what theory should we follow to guide development in the new stage?" To achieve our new development goals, we must remain committed to the new vision of innovative, coordinated, green, open and shared development. New development philosophy is a theoretical system of the system, and the answer about the purpose of development, motivation, method, path and so on a series of theoretical and practical problems, illustrates our party about the development of politics, the value orientation, development mode, development and other major political problems, promoting economic development must adhere to the new development concept.


The guiding ideology, principles, long-term goals and the "14th Five-Year Plan" goals all embody the spirit of the new concept of development. The guiding ideology of the Outline of the Plan calls for unswervingly implementing the new development philosophy of innovative, coordinated, green, open and shared development. One of the five principles outlined in the Outline of the Plan is to uphold the new vision of development and to incorporate it throughout the whole process of development and in all fields. The other four principles and the vision for 2035 are also reflected in the new development concept.


The new development pattern answers the question of how we will achieve the new goals in the new stage. Build in domestic large cycle as the main body, domestic and international dual cycle promotes mutually, the new development pattern of xi jinping, comrade as the core of the CPC Central Committee again sublimation of governing thought, is a matter of global systemic, deep change, to achieve higher quality, more efficient, more fair, more sustainable, the development of safer, with explanatory and confusing. The section of Strategic Orientation in the Outline of the Plan elaborates the construction of a new development pattern, and runs through this strategic orientation throughout the whole article.


To understand the new development pattern, we need to grasp three key points. First, building a new development pattern is the first move to seize the initiative in development, not a forced or expedient measure. Second, we should accelerate the development of a large domestic cycle of a unified national market, rather than a small regional or internal cycle. Third, to build a new development pattern, we should integrate supply-side structural reform, expanding domestic demand, innovation-driven development, and self-reliance and self-improvement through science and technology into the framework of building a new development pattern. To understand the new development pattern, we need to grasp two key words: one is "pattern", which is a macro concept of structure, is the embodiment of adhering to the concept of system, so the connotation of the new development pattern is not only "double cycle"; The other is "circulation". We should further unblock the domestic cycle of production, distribution and demand, and make the domestic and international cycles better reinforce each other.


Quality is more important than speed in achieving growth targets


According to the plans made at the 19th CPC National Congress, China will basically realize socialist modernization by 2035 on the basis of finishing building a moderately prosperous society in all respects. From an international comparison point of view, it means that within 15 years, with a starting point of $10,000 per capita income by 2019, we will move steadily toward a high-income society and strive to reach the level of per capita income of moderately developed countries.


The 14th Five-Year Plan and the 2035 Vision Targets set that the per capita GDP will reach the level of moderately developed countries by 2035, but no five-year average GDP growth target has been set. In current dollars, the entry level is now $18,000 in advanced economies and $30,000 to $40,000 in mid-level developed countries. At present, China's per capita income is US $10,000. If the target is to double to US $20,000, from a static point of view, the annual GDP growth rate should be at least 4.7%. The narrowing of the gap between China and advanced economies in terms of per capita income levels in current dollars depends partly on real growth and domestic inflation, and partly on movements in exchange rates. Exchange rate changes involve many factors, but in the long run, the most important is labor productivity and total factor productivity. The improvement in total factor productivity is the so-called quality of economic growth. If we focus on the quality of economic growth and raise labor productivity and total factor productivity, and on this basis, the exchange rate appreciates appropriately, then it is possible for the per capita income level to approach or reach the level of the moderately developed countries.


During the 14th Five-Year Plan period, China should strive to explore the structural potential matched with a period of moderate growth. Specifically, a "1+3+2" structural potential framework can be constructed. "1" refers to the development of metropolitan areas and urban agglomerations as the leading role to open up space for China's medium-speed and high-quality development in the next step. "3" refers to the real economy, to make up for the three shortcomings in the process of China's economic cycle: First, the efficiency of basic industries is low; Second, the scale of the middle-income group is not large; Third, the basic research and development ability is not strong. "2" refers to the two wings of digital economy and green development, which represent new growth potential for China with certain advantages. To put it simply, the structural potential of "1+3+2" is to lead the way, make up for the three weak links, and enlist the energy of the two wings.


In the next step, we should focus on these structural potentials and make greater efforts and more effective efforts to promote reform and opening up in relevant areas. First, we will deepen reform of the rural land system. Proceeds from land transactions should be given priority to farmers' social security. A modern social security system should replace the guarantee function of land and allocate scarce land resources to more efficient uses. Second, we will deepen reform of the spatial and urban planning systems. The market should play a decisive role in the process of spatial planning and urban planning, and urban planning should be periodically adjusted in accordance with changes in population distribution. Third, we will further relax market access in basic industries to promote competition. Fourth, we will accelerate the equalization of basic public services and gradually increase social security for rural and urban residents. Fifth, we will deepen the reform of high-level university education and basic research to solve the problem of science and technology being blocked. Through these reform and opening-up measures, we will turn the structural potential into a real growth engine.


Coordinating development and security through institutional opening up


The 14th Five-Year Plan period is the first five-year period during which China embarked on a new journey towards the second centenary goal of building a modern socialist country in all respects. As a guiding document for China's economic and social development in the next five and 15 years, the 14th Five-Year Plan and the Outline of the 2035 Vision Goals have a clear theme throughout, that is, we must unswervingly implement the new vision of innovative, coordinated, green, open and shared development.


On the basis of specifying strategic guidance and main objectives, the Outline of the Plan further clarifies specific tasks and highlights key work, while paying attention to the coordination of various areas in terms of short -, medium - and long-term development goals. It is highly scientific and systematic, and the key is to implement the plan well.


Security is the premise of development, and development is the guarantee of security. For the first time, a special section on security and development was set up in the Outline of the Plan. How to understand and grasp "coordinated development and security"? Coordinating development and security does not mean being closed or conservative. It means that China will be more open. The more concerned a country is about the security risks that openness may bring, the more, in a sense, the more open the door will be.


With the improvement of comprehensive national strength, China's interests with the international community are increasingly high, and security naturally becomes an issue that must be considered in the process of development. China's level of opening-up is not only relevant to its own development, but also affects the recovery of many countries and even the world economy. At present, unilateralism and protectionism are on the rise, uncertainties in the international situation are increasing, and some countries even talk of "decoupling" from China. Against this backdrop, the CPC Central Committee has called for wider, broader and deeper opening-up, which demonstrates China's tolerance and sense of responsibility.


The government work report listed "carrying out high-level opening up and promoting stable and high-quality foreign trade and foreign investment" as one of the country's eight key tasks in 2021. Looking ahead to the 14th Five-Year Plan period, the Outline of the Plan calls for building a new system for an open economy at a higher level, promoting high-quality One Belt And One Road development, and actively participating in the reform of the global economic governance system.


Institutional opening up is the core of implementing higher level opening to the outside world. The three construction directions proposed in the Outline of the Plan reflect the internal logic of the new pattern of all-round opening up, among which the establishment of a new system of open economy is the basis for the realization of a higher level of opening to the outside world, as well as the internal requirements for high-quality construction of "One Belt And One Road" and participation in the reform and improvement of global economic governance.


Only to introduce and walk out based on fair and reasonable system arrangement, continuously strengthen countries in such aspects as rule, regulation, management, standards of coordination and integration, in order to reduce uncertainty of exchanges, lower transaction costs, maximize returns in countries from the international division of labor and trade, better realize the goal of mutual benefit and win-win results.


We will make solid progress in promoting common prosperity


The 14th Five-Year Plan and the Outline of the 2035 Vision Goals highlight the overall strategic plans of the Party to lead the people in building a modern socialist country on a new stage of development, a new vision for development, and a new pattern of development. They represent, in a grand way, the great vision of starting a new journey to build a modern socialist country in all respects. One of the important goals is to achieve more tangible progress in achieving common prosperity for all. This is a major strategy for advancing the cause of the Party and the country, and it fully demonstrates the strengths of the socialist system.


How can we make solid progress in promoting common prosperity? In general, we need to do a good job in top-level planning, study and formulate a program of action for promoting common prosperity, and define a blueprint for the future, policy improvement, institutional direction and path to achieve it. To be specific, first, we need to fully implement the new development concept. We should develop a new pattern of development, promote the simultaneous development of industrialization, urbanization, IT application and agricultural modernization, enhance our capacity for independent innovation in science and technology, the competitiveness of industrial chains and supply chains, and the potential of super-large consumer markets, and gradually narrow the gap between urban and rural areas and between regions.


Second, we must continue to adhere to and improve the basic socialist economic system. We should firmly adhere to the principle of "two unswervingly". On the one hand, we should make the state-owned economy bigger, better and stronger, and on the other hand, we should guide the development of the private sector. We should leverage our two comparative advantages and work together to shoulder the heavy responsibility of China's economic growth. To build a business environment that is market-based, law-based and international, we need to select some regions, enterprises and departments to carry out trials, and encourage the development of experience that can be replicated and extended.


Third, we must be determined to advance the reform of the income distribution system. We will continue to increase personal income basically in step with economic growth, and increase labor remuneration basically in step with increases in labor productivity, expand channels for increasing personal income, improve the mechanism for participation in the distribution of factors of innovation, and increase property income through multiple channels. We will continue to raise the incomes of low-income groups and expand the middle-income group. We will improve the mechanism for income redistribution and the third distribution of income, and encourage the development of public welfare undertakings.


Fourth, we will vigorously promote reform of the fiscal, taxation and financial systems. We will better coordinate fiscal, taxation and financial resources to contribute to common prosperity. In particular, we should not allow financial capital to grow in a wild way. Instead, we should enhance the ability of financial capital to share its services, so that it can better serve low - and middle-income people as well as small, medium and micro businesses, and support the development of the real economy.


Fifth, we will implement supporting economic and social policies. The whole society must respect, uphold and love work. We will implement the strategy of giving top priority to employment, improve the national public service system, improve the structure of income distribution, improve the multi-tiered social security system, and build a high-quality education system.


Sixth, focus on key areas and strengthen weak links. We will focus our work on overall planning for employment, income distribution, education, medical care, housing, old-age care and other matters that concern people's lives and social equity and justice. We will give full play to the role of the government in regulating redistribution, increase the intensity and precision of regulation of taxation and social security, regulate excessive incomes, and clamp down on illegal incomes. Transfer payments should be geared toward those in need.


Build a new pattern of double circulation with system thinking


The 14th Five-Year Plan and the Outline of the 2035 Vision Goals formulated at the intersection of two centenary periods fully reflect our systematic thinking and overall planning to meet new challenges in the new stage. In order to construct a new development pattern in which the domestic cycle is the main body and the domestic and international double cycles promote each other, the 14th Five-Year Plan, starting from the system thinking, puts forward to focus on the construction of the domestic and foreign systematic double cycles.


In the internal cycle, the "14th Five-Year Plan" and the 2035 vision target outline systematically from the supply side, the demand side, the spatial layout and the development of the industrial chain and other dimensions to build the domestic cycle. From the supply side, the Outline of the Plan proposes to adhere to the science and technology innovation driven, promote the formation of a triangle of finance, science and technology and industry benign interaction mechanism. In terms of scientific and technological innovation, it is proposed that we should continue to increase basic research to solve the "bottleneck" problem in some key technological fields in China. In terms of enterprise innovation, it is proposed to fully activate the vitality of market entities and improve the incentive mechanism for the property rights of scientific and technological achievements.


On the demand side, the Outline emphasizes that we should continue to take expanding domestic demand as the strategic basis and combine the implementation of the strategy of expanding domestic demand with the deepening of supply-side structural reform. On the one hand, we should use innovation to drive growth and create new demand with high-quality supply. We should promote market-oriented reform of factors of production and encourage the development of new forms of consumption, so as to form a large cycle of supply, distribution, expenditure, consumption and investment. On the other hand, during the 14th Five-Year Plan period, China will increase residents' property income through multiple channels and realize consumption growth by improving residents' income level.


The outline also emphasizes high-quality spatial connections between supply - and demand-side cycles. China has a vast region, and the core of spatial circulation lies in the development of urban agglomeration and the integration of urban and rural areas. The Outline emphasizes that urban agglomerations should be the focus of efforts to optimize regional economic distribution and promote coordinated development among regions. It calls for increasing the urbanization rate of permanent urban residents to 65 percent and developing and expanding urban agglomerations and metropolitan areas.


The relationship between supply and demand is mainly manifested as the development of industrial chain in the form of realizing economic value. The Outline of the Plan emphasizes building a high-level socialist market economic system, promoting the modernization of the industrial chain, and puts forward the development of a modern industrial system, so as to promote the optimization and upgrading of the industrial chain by adhering to the principle of autonomy, control, safety and efficiency. Promote the orderly transfer of the industrial chain in China, and optimize the regional layout of the industrial chain.


In terms of external circulation, the plan outline emphasizes that the new pattern of double circulation is an open pattern. During the 14th Five-Year Plan period, China will adhere to the wider, wider and deeper opening to the outside world, strive to build an open economic system of a higher level, and promote an institutional opening that integrates economy, trade, investment and services. At the same time, during the 14th Five-Year Plan period, China will continue to increase bilateral and multilateral economic and trade cooperation, accelerate the integrated development of special customs supervision zones and pilot free trade zones internally, actively build a global network of high-standard free trade zones externally, and actively participate in the reform of global economic governance system.


Source: State-owned Assets and Administration Commission of the State Council