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<\/p>\nCommunist Party leaders are meeting in Beijing\u00a0this week to map out China\u2019s economic strategy for the next five years \u2013 doubling down on ambitious plans to dominate high-tech industries and raise the country\u2019s geopolitical heft.<\/p>\n
Despite escalating trade friction with the United States and other countries, Chinese leader Xi Jinping has signaled that his top economic priority is boosting China\u2019s manufacturing prowess with across-the-board technological innovation \u2013 reflecting confidence that Beijing\u2019s current course is a winning one.<\/p>\n
While details of the country\u2019s new five-year plan, covering 2026 to 2030, will be released in coming weeks and months, the main pillars of its industrial policy are clear: increase China\u2019s self-reliance in advanced technologies, while expanding overseas markets to fuel export-driven growth.<\/p>\n
Why We Wrote This<\/p>\n
The world’s second-largest economy, China, is deciding its economic strategy for the next five years, a decision with high global stakes. <\/p>\n
Indeed, experts say that China\u2019s status as the world\u2019s second-largest economy is attracting growing attention to the once obscure, state-led plans, the first of which was launched under Mao Zedong in 1953.<\/p>\n
\u201cIf we have learned something from the past decade, it should be to take these plans seriously,\u201d says Katja Drinhausen\u00a0from the\u00a0Mercator Institute for China Studies (MERICS), a Berlin-based think tank. \u201cThe strategic push of the next five-year plan is something that \u2013 one way or another \u2013 pretty much all countries around the world will feel.”<\/p>\n
Withstanding pressure\u00a0<\/p>\n
Mr. Xi\u2019s determination to stay the course on his\u00a0economic policy has been strengthened by how China has so far weathered the trade-war turbulence unleashed by U.S. President Donald Trump.<\/p>\n
Tariffs and other trade barriers imposed on China in recent months by the United States and European Union have had a limited impact on the country\u2019s overall exports.<\/p>\n
\u201cChinese companies have been able to manage the tariff burden,\u201d says Andrew Batson, chief analyst of the Chinese economy at the independent research firm\u00a0Gavekal\u00a0Dragonomics. \u201cChina has been very effective in the trade diplomacy with the U.S. and averting much worse outcomes.”<\/p>\n
\t\t\t<\/p>\n
Shipping containers fill the port in Qingdao, China, Oct. 20, 2025. A main pillar of China’s new five-year economic plan is to expand overseas markets to fuel export-driven growth.<\/p>\n
Moreover, the Chinese government is likely \u201cquite skeptical\u201d of Washington\u2019s willingness to maintain extremely high tariffs on China, such as the 100% levy on U.S. imports from China that Mr. Trump recently threatened, Mr. Batson says.<\/p>\n
Trade restrictions by the U.S. and the European Union do \u201cnot seem to be blowing them off course at all,\u201d agrees Jonathan Czin, a fellow in the John L. Thornton China Center at the Brookings Institution in Washington.\u00a0<\/p>\n
China\u2019s economy is on track to meet the government target of a roughly 5% increase in gross domestic product this year, having achieved 5.3% GDP growth in the first six months. Robust increases in exports \u2013 up 8.3% year-over-year in September alone \u2013 along with strong industrial production, have driven that growth, government data shows.<\/p>\n
Mr. Xi casts China\u2019s industrial policy as a source of economic stability in an increasingly uncertain world. China must \u201cuse the certainty of high-quality development to cope with the uncertainty arising from the rapidly changing external environment,\u201d Mr. Xi urged at a meeting of the Communist Party\u2019s ruling Politburo in April.<\/p>\n
Beijing\u2019s confidence about withstanding protectionist pressures is reflected in the effusive tone of official media reports. This month, a commentary in the party-controlled People\u2019s Daily declared that \u201cthe giant ship of China is an unstoppable, unbreakable \u2018economic aircraft carrier,\u2019 undeterred by wind and rain and forging ahead.\u201d\u00a0<\/p>\n
Road to development<\/p>\n
China\u2019s success in recent years in gaining dominance over cutting-edge industries \u2013\u00a0from electric vehicles and batteries to solar panels \u2013 has reinforced its pursuit of technological innovation to boost productivity.\u00a0<\/p>\n
\u201cThey see themselves on the precipice of \u2026 a technological revolution\u201d that will put them at the center of the world stage, says Alexander Davey, an analyst at MERICS who focuses on China\u2019s policymaking.\u00a0<\/p>\n
Still, the industrial policy has not been without its shortcomings, requiring course corrections.\u00a0<\/p>\n
State support \u2013 such as subsidies and tax breaks \u2013 has helped nurture young, innovative industries. But it has also led to a proliferation of Chinese companies competing to make similar products, as well as overproduction, price wars, and an erosion of profits.\u00a0<\/p>\n
The government is likely to address this problem in the new five-year plan by encouraging consolidation in industries such as electric vehicles, while also calling for regions to specialize in order to avoid the wasteful duplication of resources. In Beijing\u2019s view, cities should \u201cstop acting like little kingdoms and being protectionist,\u201d says Mr. Davey.<\/p>\n
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<\/p>\n
Customers shop for a washing machine at an appliance store in Beijing, Oct. 19, 2025. Communist party leaders are hammering out a new five-year economic plan. <\/p>\n
Another pressing issue is to what extent Beijing will balance its industrial policy with support for other stated priorities, such as increasing domestic demand and consumption. Despite much lip service to the goal of improving people\u2019s livelihoods, policies to increase social benefits \u2013 such as pensions and other welfare \u2013 have been lacking.\u00a0<\/p>\n
Consumption in China is lagging given a lack of confidence in the economy among households \u2013 largely a result of ongoing stagnation in the housing market \u2013 as well as private businesses. \u201cPrivate sector confidence\u00a0has still not substantially recovered from its\u00a0rock-bottom\u00a0standing,\u201d says Mr. Davey.\u00a0<\/p>\n
China analysts will also be watching to see whether the new, 15th\u00a0five-year plan contains specific GDP targets, which were omitted from the previous plan. Such guidance could help ensure that China reaches Mr. Xi\u2019s long-term goal of becoming a \u201cmoderately developed country\u201d by 2035, which economists estimate would require average growth of about 4.5% a year.<\/p>\n","protected":false},"excerpt":{"rendered":"Communist Party leaders are meeting in Beijing\u00a0this week to map out China\u2019s economic strategy for the next five…\n","protected":false},"author":2,"featured_media":139951,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[174],"tags":[79,179,18,19,17],"class_list":{"0":"post-139950","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economy","10":"tag-eire","11":"tag-ie","12":"tag-ireland"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ie\/115422136183328333","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/139950","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=139950"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/139950\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/139951"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=139950"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=139950"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=139950"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}