Two sessions 2025: A China focused on its roadmap

XULIO RIOS

The holding of the two sessions or lianghui, the main annual political conclave in China that simultaneously brings together the plenary sessions of the National People's Congress and the Chinese People's Political Consultative Conference, is a barometer of the concerns and objectives of the country's leadership.

At the presentation of the report on the work of the Government, Prime Minister Li Qiang, focused much of his speech on the economy. After experiencing 5,4% growth in the last quarter of 2024, he announced how growth target of “around 5%” by 2025, en in line with expectations and identical to that of the two preceding years. 

The context is twofold. On the one hand, it coincides with a tightening of US tariffs that foreshadows a new escalation of the trade war; on the other, the end of the 14th Five-Year Plan and the culmination of the process of elaboration of the 15th at a critical juncture of progress in the reform towards the new development model. In addition, the content of this plan must lay the foundations to promote modernization with a horizon of 2035, which should close the first stage of Xiism towards 2049.

Among the guidelines highlighted at the start of the second session, there are some that are particularly important. On the one hand, the promotion of domestic demand, supported by a one percentage point increase (to 4%) of the deficit and the issuance of long-term Treasury bonds, in addition to greater support for local governments. In the report, the word “consumption” was the most frequently mentioned word in the last decade. The 2 percent inflation forecast is the lowest since 2003. On the other hand, the increase in people’s income, estimated as the most important basis for promoting consumption. Official statistics show that in 2024, per capita disposable income exceeded 40.000 yuan for the first time, rising to 41.314 (5.672 dollars). In 2035, the goal of doubling per capita GDP on the basis of 2020 must be met, turning China into a high-income country.

Secondly, the technological push, with artificial intelligence taking centre stage. Data from the National Bureau of Statistics show that by 2024, China's total spending on research and development (R&D) will reach 3,61 trillion yuan (about 503.210 billion U.S. dollars), securing its position as the second-largest R&D spender in the world. China longs to be prepared to take advantage of the opportunities of the Fourth Industrial Revolution, prioritizing advances in cutting-edge fields.

On lianghui will also plan the debate on the promotion of the private economy. Xi Jinping himself emphasized , the Key priorities include supporting the growth of the private sector and private enterprises, accelerating the development of the digital economy and promoting high-level opening-up, all of which are crucial to China's economic and social progress. at the current stage.

Three relevant antecedents

At the Central Economic Work Conference in December last, which sets the “tone” of these lianghui, it was urged implement more proactive macroeconomic policies by 2025, especially, a "moderately loose" monetary policy, which marks a significant change from the "prudent" approach of the past 14 years.

In February, the Council of State also unveiled a “2025 Action Plan to Stabilize Foreign Investment” with the aim of attracting foreign capitalhigher and persuade existing China-based companies to stay in the country in the face of expectations of increased global trade tensions.

The holding of a symposium with business leaders from the private sector with the participation of the Xi I had to send a message of calm and confidence. FIt was the first time in seven years that Xi courtship so explíquote to istcompanies, toadvancing additional benefits in areas such as access to credit and government assistance in various domains.

In parallel, la adoption of a first fundamental law about him development of the private economy must mean your condition of vital pillar of the socialist market economy. Private enterprises have long been a key driving force behind China's economic rise, contributing more than 60 percent of the country's GDP and 80 percent of urban employment. By the end of September 2024, the country's 55 million registered private companies accounted for more than 92 percent of all enterprises in China..

Waiting for Donald Trump

The main objective of Trump's second term is to counter China. There seems to be little doubt about that, as it seems an imperative associated with the prevalence of America First. Some measures have been advanced by the White House, from the imposition of new tariffs to the limitation of investment in strategic fields. In another order, the pressures on the Chinese presence in the world and the search for a long-term understanding with Russia, beyond peace in Ukraine, will hang over the lianghui.

For the moment, Trump has not focused on repressing China, but rather on what appears to be an attempt to discipline allies, getting them to contribute not only to the rapid capitalisation of the country but also to the massive defence spending that they resisted during his first term. The expectation of much tougher measures is still there, but the strategic pressure has not overflowed as might be expected. It is possible that it will be delayed until a later phase. In any case, China has shown signs of improving its capacity to resist the challenge that Trump's policy may pose. Vigilant, everything indicates that it is waiting to learn more about his effective attitude, reserving additional measures.

It should be noted that, despite the fireworks and uncertainties, Trump has shown continued interest in the Indo-Pacific region, as evidenced by his Quick Meetings with leaders of Japan and India and strengthening of the discourse against mainland China by some prominent members of his cabinet, from Marco Rubio to Mike Waltz or Pete Hegseth.

Regarding Taiwan, careful note will have been taken of the elimination of a line indicating Washington's long-standing stance of not supporting Taiwan independence from a fact sheet on bilateral relations. This could be interpreted as Stronger support from Washington to Taipei.

The announcement ofThe president of Taiwanese semiconductor giant TSMC, CC Wei, alongside President Trump, an additional investment of 100.$000 billion in the semiconductor industry in the United States that elevates the total amount spent by the company in the USAU a the 165.000 million to increase US production of advanced semiconductor technology, will not have gone unnoticed either. Given that the The cost of building facilities in the United States could be up to four times higher than in Taiwan, it is conceivable that this decision goes beyond the concern to avoid the imposition of tariffs and responds to political motivations endorsed by the Taiwanese presidency. The fear of the Americanization of TSMC (USMC, critics already say) with a transfer of production from its most advanced technologies to the territory of United States The fact that Taiwan is being asked to pay a “protection fee” and the ongoing testing of multi-million dollar arms purchases and increased defense spending on the island suggest that Taiwan is strongly aligned with Trump’s policies. Taipei hopes to allay fears of “abandonment” while critics, in light of what happened with Ukraine, predict the worst once Taiwan loses its “silicon shield.”

Back to multipolarity

China's rapid rise is the main reason behind the changing international roles of the United States. The breaks in the global order since the beginning of Trump's second term will encourage a China's more active role in world affairs.

There are several possibilities. First of all, that China apply for assumir the responsibility of leadership. It is unlikely considering that would face distrust from Western nations with whom cooperation can be improved in the current circumstances, such as also because China is not in a position to take on that burden nor vocation for it. Its priority remains development.

Secondly, orAnother possibility is the G2 scenario, a shared government between China and the United States, or a dual hegemony, already rejected in its day. It is also unlikely given the current standoff, with severe mutual distrust and cooperation in question or clearly on the decline.

Third, a shared directorate with Russia, perhaps with the aim of driving a divisive wedge into the understanding between Moscow and Beijing, securing respective spheres of influence. And fourth, the move towards a multipolar world order which continues to have the United Nations at its core and takes particular account of the EU. This is the main direction underpinning Chinese diplomacy, as Minister Wang Yi emphasized at the security summit in Munich, Germany.

Conclusion

china swill continue Focused on the management of the economy and strengthening capabilities in all areas to achieve the desired high-quality development, applying “long-range” goals to this endeavour, with a horizon of 2035. At the international level, the commitment to multilateralism will strengthen the rapprochement not only with the Global South, as it opens up expectations of the involvement of other actors interested in a greater balance of power in interstate relations, capable of facing the profound global challenges that the current Trump administration addresses with total disdain.

Xulio Ríos is Emeritus Advisor to the Chinese Policy Observatory.