The Chinese Communist Party’s 14th five-year plan, for the period between 2021-2025, was released last week, emphasising domestic consumption as the driver of growth amid an acrimonious trade war with the US during its previous plan-period. The new plan reflects a drift from the strategy of export–led growth that has propelled the Chinese economy in the last two decades.
The central committee of the party signed the plan, to be implemented by 2025. Observing that the “international environment is increasingly complicated” and full of “instability and uncertainty”, the new plan seeks to kick start a domestic demand for economic growth and technological innovation. The Fourteenth plan will be ratified by the Chinese parliament early next year.
The US, under Trump, locked horns with Xi Jinping's government by imposing tariffs on Chinese imports. Beijing responded by devaluing its currency last year. The Trump administration then imposed a whopping 10 percent tariff on Chinese imports, said to be worth some $300 billion.
Even though Trump signed a limited trade deal with China in January of this year, the COVID-19 pandemic and Trump's description of the disease as the "Chinese virus", led to further straining trade between the US and China.
Even as Democratic candidate Joe Biden is close to victory in the US presidential elections, a new administration may not necessarily end the restrictions imposed on Chinese technology firms by Trump.
Some question how much ground an inward-facing China could cede for other nations, especially India, to gain a foothold in global trade.
A senior Indian journalist, Deepak Joshi, believes that expecting China to cede any ground to others will be too much to expect.
Joshi points out that the full details of the newest five-year Chinese plan will be known only after the ratification of the plan by the country’s governing body.
“That said, it may be noted even as Biden is likely to take charge, the Democratic dispensation in the US is expected to continue to deny technological support to Chinese firms,” Joshi asserted to Sputnik.
The Indian journalist suggested that, when China talks about “self-sufficiency”, it means that Beijing will work toward indigenous technology by decoupling itself from its current dependence on global suppliers. The Trump administration has recently denied American telecommunications technology to Chinese companies like Huawei.
Speaking to Sputnik, an unnamed but former top official who served in the Indian Ministry of Commerce, said, “Just because China has pledged for self-reliance as an economic policy, it will not work wonder[sic] for the Indian exports overnight. But yes, India can review the situation [by observing individual trade sectors] and fill in space by trying to gain entry in the market. For example, the European textile market, where Chinese exports are slowing down, could be an opportunity for India.”
Is Chinese Self–Reliance Another Name for 'Trade War'
Chinese President Xi Jinping on Wednesday said that “unilateralism” and “protectionism” should not be allowed to undermine an international order.
In a video message at an annual Shanghai import/export convention -- the 5 November China International Import Expo – Xi said: “We should take a constructive stance to reform the global economic governance system and promote an open world economy.”
“With a population of 1.4 billion and a middle-income group exceeding 400 million, China is the world’s largest market with the greatest potential. China is expected to import an accumulated over-$22-trillion worth of goods in the next 10 years,” the Chinese president claimed.