China's economic confidence shines in 2025 roadmap

Editor's note: Moiz Farooq is the executive editor of Pakistan Economic Net and Daily Ittehad Media Group. The article reflects the author's views and not necessarily those of CGTN.

The 2025 Two Sessions—China's annual gatherings of the National People's Congress (NPC) and the Chinese People's Political Consultative Conference (CPPCC)—once again showcased the country's ability to address economic challenges with strategic foresight and precise policy measures. Amid a volatile global economic landscape, China has reasserted its role as a pillar of global stability, growth, and innovation.

One of the key highlights of the sessions was the announcement of a GDP growth target of around 5 percent for 2025, indicating confidence in China's macroeconomic foundations and a commitment to balancing growth with stability. Premier Li Qiang emphasized that this goal allows for sustained employment, a supportive business environment, and improved living standards—sending a clear signal to international observers that the Chinese economy remains resilient and forward-moving.

To drive this growth, China adopted a proactive fiscal policy, increasing the fiscal deficit-to-GDP ratio to 4 percent, up from 3 percent the previous year. The draft budget includes 4.4 trillion yuan or about $680 billion in special government bonds, marking a rise of 500 billion yuan compared to last year. These funds target long-term development areas such as infrastructure investment, social welfare, innovation, and industry upgrades—an indicator of China's determination to build strong future foundations.

Technological innovation remained a major priority. R&D expenditure was increased to  398.1 billion yuan or $62 billion, a 10% year-on-year rise focusing on high-tech development, basic research, and core advancements in areas such as artificial intelligence, smart manufacturing, semiconductors, and clean energy. Chinese President Xi Jinping further reinforced this by urging regional governments and industries to modernize systems with innovation as the main engine of growth. This drive toward technological self-reliance aligns closely with the broader national vision of economic modernization.

China also prioritized strengthening domestic consumption as a primary economic driver. New policies were introduced to expand middle-income groups, increase minimum wages, enhance pension systems, and support childcare. Specific strategies were set for sectors like AI-powered products and winter tourism. By focusing on consumption-driven growth, the State Council emphasized long-term economic transformation beyond short-term stimulus.

Efforts to stabilize the real estate market and financial systems complemented these initiatives. The Chinese stock market responded positively to policy clarity, with major indices seeing a strong rebound—the best annual start since 2002. Policies aimed at revitalizing technology sectors and easing regulatory burdens contributed to this recovery, boosting both local and global confidence in China's strategic economic management.

Private enterprises and SMEs also received notable support. A draft law promoting the private economy was introduced to protect their rights, reduce systemic barriers, and foster a law-based and market-oriented business environment. These measures aim to empower entrepreneurs, drive innovation, and create jobs, underscoring the importance of this sector in China's economy.

The dual circulation strategy, which emphasizes domestic consumption while complementing it with foreign trade and investment, was reinforced. This approach seeks to boost China's resilience by reducing dependency on external markets while sustaining global cooperation. Furthermore, green development initiatives were integrated into the broader economic framework. China's climate goals—focused on clean energy, carbon reduction, and green finance—demonstrate that economic growth and environmental sustainability can coexist.

China's 2025 Two Sessions reflected a bold, visionary approach blending growth with equity, innovation with tradition, and domestic goals with global responsibilities. This holistic strategy underlines the strength of China's governance model, characterized by long-term planning, effective implementation, and adaptive reforms. As President Xi articulated, "Innovation is the first driving force of development," a principle embodied in the country's policies.

At a time of global uncertainties such as inflation, protectionism, and economic instability, China's strategic clarity stands out. Its pragmatic and confident policies position the country as a cornerstone for global recovery and collaboration. While challenges remain, the outlined strategies ensure a stable path forward, redefining China's role as a model of resilience and renewal on the world stage.