Meia Nouwens
Following an unprecedented nine-month delay, last week the Chinese Communist Party (CCP) finally held its third plenum – a meeting of Central Committee members to outline China’s long-term economic and social policies. It subsequently published an initial brief communiqué on 18 July, with a decision document providing greater detail on 21 July. In the lead-up to the event, the Chinese media and debate within China’s expert and academic communities focused on the need for reforms in the face of considerable domestic and external challenges. These include a slowing economy, weak consumption, unequal wealth distribution and a need to increase technological innovation and attract foreign investment following a three-year nosedive. (Following the expansion of anti-spying laws and notable raids on consulting companies, as well as US sanctions limiting investment in China’s technological sector, foreign companies have grown to perceive operating in China as carrying greater political risk.) Unsurprisingly, China’s leaders announced in the communiqué that ‘we must purposefully give more prominence to reform’ and adopted ‘The Resolution of the Central Committee of the Communist Party of China (CPC) on Further Deepening Reform Comprehensively to Advance Chinese Modernization’.
Structural reforms and foreign investment
In order to transform the country into a ‘modern socialist economy’ driven by high-quality development, the plenum’s communiqué outlined structural reforms to the economy and plans to attract foreign investment. However, the CCP’s definition of ‘reform’ is not the same as the West’s; articles in the People’s Daily in the lead-up to the third plenum highlighted previous statements made by President Xi Jinping that reform does not mean changing direction and does not mean China will take on a Western governance model. As such, the reforms discussed in the communiqué do not represent huge strategic shifts but rather technical adjustments within a party-state system – a system in which the CCP’s (and in particular Xi’s) centrality and interests remain of key importance.
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