Editor's note: Xin Ge, a special commentator for CGTN, is a research fellow at the Institute of Public Policy and Governance, Shanghai University of Finance and Economics (SUFE), and a chair associate professor at the School of Public Administration and Policy, SUFE. The article reflects the author's opinions and not necessarily the views of CGTN.

Chinese President Xi Jinping's address on New Year's Eve offers more than a customary reflection; it provides a blueprint of how China is recalibrating its developmental engine. Throughout 2025, a year characterized by structural transition, the primary narrative of Chinese governance was not found in soaring skyscrapers or heavy industries, but in the granular improvements of the "people's livelihood." By pivoting from a traditional focus on infrastructure to a systematic "investment in people," China is redefining the metrics of success for a modern major country.

Xi's domestic inspection tours in 2025 across urban districts, rural communities, enterprises and trade markets functioned as a high-level feedback loop, allowing the central government to bypass bureaucratic layers and engage directly with grassroots realities. Such engagement informed the June 2025 issuance of the "Opinions on Further Guaranteeing and Improving Livelihoods," a document that sought to dismantle long-standing systemic bottlenecks. The leadership's insistence on "understanding the sentiment of the people" translated into a policy framework that prioritized urgent public needs over abstract growth targets, ensuring that the state's massive resources were deployed to address the most pressing social anxieties.

The most tangible evidence of this shift lies in the 2025 national ledger. Public finance in China has historically been a tool for massive fixed-asset investment, yet the 2025 budget revealed a decisive tilt toward social welfare. National general public budget expenditures for education rose by 6.1 percent. Meanwhile, social security and employment spending grew by 5.9 percent. These figures represent a strategic commitment to strengthening the social floor even during a period of complex economic transition. Beyond these broad categories, the allocation of 156.68 billion yuan (about $22.39 billion) in specialized assistance funds provided a critical safety net for those vulnerable to disaster or medical-induced poverty. By quantifying social commitment through such substantial fiscal outlays, the state is effectively de-risking the lives of its people, allowing them to participate more confidently in a shifting economy.

Labor market policy in 2025 also underwent a structural evolution. Moving beyond the goal of maintaining employment scale, the Ministry of Human Resources and Social Security introduced a new framework for "high-quality entrepreneurship." This initiative promoted models that combined scientific research, vocational training and livelihood needs with startup culture. The efficacy of this approach was validated during the 2025 Greater Bay Area Entrepreneurship Competition, which drew over 7,000 projects and secured 2.51 billion yuan in intentional investment. Such approach has empowered individuals to leverage their skills in sectors such as digital services and elderly care, turning social challenges into engines of personal and national wealth.

The most critical test of this strategy was its response to demographic shifts. In 2025, China implemented policies designed to insulate families from the rising costs of aging and childcare. In the realm of elderly care, the government promoted "aging-in-place" by subsidizing home modifications. Provinces such as Zhejiang and Guizhou led this initiative with "Renew and Upgrade" subsidies for senior-friendly products. In Zhejiang alone, the completion of 64,900 household modifications demonstrated how targeted fiscal intervention can dramatically improve quality of life. Simultaneously, the July 2025 "Implementation Plan for the Childcare Subsidy System" replaced indirect incentives with direct, nationwide cash subsidy. This move signaled a definitive stance that the state must share the financial burden of child-rearing to ensure long-term demographic sustainability.

The holistic approach was formally enshrined in the Recommendations of the Central Committee of the Communist Party of China for Formulating the 15th Five-Year Plan for National Economic and Social Development, approved during the fourth plenary session of the 20th Communist Party of China Central Committee. The plan introduced the groundbreaking concept of "tightly integrating the improvement of livelihoods with the stimulation of consumption," while emphasizing "investment in people" alongside "investment in things." This is the core of China's new economic logic. By investing in the education, health and security of its people, the government is building the foundational human capital required for a consumption-driven economy. When people are relieved of the "three mountains" of high costs in housing, education and healthcare, their propensity to consume increases, creating a virtuous cycle of domestic demand.

The strategy of 2025 has proved that modernization is hollow if it does not deliver a tangible increase in the standard of living. By focusing on small businesses, aging households and young families, the Chinese government is ensuring that development benefits are distributed more equitably. The transition toward "investing in the individual" marks the maturation of the Chinese model – moving from an era of rapid expansion to one of high-quality, inclusive growth. As the nation moves into the 15th Five-Year Plan, the human metrics of success have become the ultimate KPI for the state. China's path forward is clear: The strength of the nation is inextricably linked to the well-being of the individual, and the most profitable investment a modern state can make is in the lives of its people.