Plenary communique: A beacon for China's high-quality development

Editor's note: Ishrat Hussain, a special commentator on current affairs for CGTN, is the former chief economist for the World Bank and former advisor to the prime minister of Pakistan. The article reflects the author's opinions and not necessarily the views of CGTN.

One of the critical factors for China's success since 1978 has been its long-term planning, including formulating a reform agenda and setting the direction for economic development. The third plenary session of the 11th Central Committee of the Communist Party of China (CPC) in 1978 was of great importance as the late Chinese leader Deng Xiaoping set the path for a paradigm shift from a planned economy to a market economy in which the incentives of all the key players in the economy – the individuals, households, firms, local governments, etc. – were aligned for the nation's economic modernization and opening up.

The third plenary session, held roughly once every five years, reviews the progress made during the past half decade, and fine-tunes developing tasks to the changing domestic and international circumstances; but the direction remained unchanged such as achieving economic prosperity and upgrading living standards of the Chinese people.

The macro-level national strategies set by the central government were implemented by the local governments whose officials are willing to play an active role. China's meritocratic heritage made the transition to modern governance easier and "unleashed its latent capacity to boost modern science and technology in the new era." The unparalleled feat of lifting nearly 800 million people out of absolute poverty in four decades can be attributed to this duality of centralization of authority and economic decentralization locally based on meritocracy.

By the third plenary session of the 18th Central Committee of the CPC in 2013, China had liberalized interest rates, reformed the taxation system, attracted foreign capital flows and became the largest trading nation in goods.

The third plenary session in 2013 took up the new issues that had arisen from these achievements and "emphasized the importance of narrowing the wealth gap, the need for more balanced regional development, along with improving the social welfare system and boosting the role of the private sector alongside that of State-owned enterprises."

The just concluded third plenary session of the 20th Central Committee of the CPC was held under the background of a more hostile Western stance against China, a slowdown in world economic growth, persistent deflation, and inadequate consumer spending, among others. There was an awareness that the weight of the emerging challenges of climate change, technological disruption, and demographic transition should also be taken into account while shaping the strategy for the future. Despite these challenges for which remedial actions are proposed, the Party remained committed to pursuing Chinese modernization, improving people's living standards, while providing more opportunities for the private sector to shine, expanding the opening up of the economy, keeping China's doors wide open and vitalizing rural areas to bridge the urban-rural income gap.

The third plenum's pursuit of modernization and industrialization with emphasis on scientific and technological progress, promoting innovation in all areas of the economy would not compromise on protecting the environment. Instead of the popularly held notion that China keeps the fruits of its scientific research confined within its boundaries, the Party underscored the importance of expanding global scientific exchanges, strengthening the international research environment and creating a globally competitive innovation ecosystem.

The integration of China into the global scientific ecosystem is crucial for the concept of new quality productive forces, a component of comprehensive high-quality development. This initiative is expected to directly influence the productivity of Chinese enterprises and consequently enhance their competitiveness by promoting advanced manufacturing and digitalization, and securing the supply chains while further developing core and emerging technologies.

On climate change and environmental protection, the plenary communique was quite forthcoming – "We must improve ecological conservation systems, take a coordinated approach to carbon-cutting, pollution reduction, green development, and economic growth, actively respond to climate change, and move faster to improve the systems and mechanisms for applying the principle that lucid waters and lush mountains are invaluable assets." The impressive progress made by China in renewable energy, particularly solar panels, batteries, and electric vehicles, surpassing all other countries in the world, does attest to this firm commitment of the Chinese authorities.

As the communique stated, the market must be better leveraged, with a fairer and more dynamic market environment to be fostered and resource allocation to be made as efficient and productive as possible. Restrictions on the market will be lifted while effective regulation will be ensured to better maintain order in the market and remedy market failures. To address one of such market failures, the Party committed to improving the income distribution system, the employment-first policy, and the social security system, further reforming the medical and healthcare systems, and improving the systems for facilitating population development and providing related services.

Reform tasks made in the plenary communique not only demonstrate the CPC's determination to reform for the people but also reflect its commitment to fostering new drivers of sustainable economic and social development through enhanced technological innovation capabilities.

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