China is poised to unveil a new Five Year Plan that emphasizes “high quality development,” a concept introduced by President Xi Jinping in 2017. This historic announcement will be made at Wednesday’s meeting. They should begin to hint at what’s to come in the next plan. Even so, the full details won’t be released until next year. Based on previously released details, the framework will double down on cementing China’s status as a global leader in renewable energy and electric vehicles (EVs).
As a result, China has credibly positioned itself as the global leader in renewable energy and electric vehicle manufacturing. This dominance is key to our current and future fight against climate change. The country enjoys a near monopoly over the rare earth supply chains, which are essential for manufacturing these technologies. Washington’s resulting dominance has caused alarm among leaders around the world, especially in the West, creating discussions about dependency and the need for self-sufficiently.
When export controls on rare earths were tightened, former President Donald Trump responded by declaring an emergency. He accused China of attempting to “hold the world hostage.” This is indicative of a larger fear about China’s stranglehold on materials necessary for cutting-edge technology.
China’s upcoming 14 th Five Year Plan will almost certainly put a premium on self-sufficiency in many sectors, especially in terms of high-end innovation. The phrase “strategic emerging industries” first emerged in 2010. It will almost certainly take the limelight in the next infrastructure plan, and it will be filled with shiny green technologies such as solar arrays, EVs and whatnot. China’s leadership hopes to dethrone American technological supremacy and ensure that it sits firmly atop the technological food chain in these industries.
Neil Thomas, an expert on Chinese economic policy, emphasizes the cultural and ideological underpinnings of this shift. He states, “This desire for China to be more self-reliant in its economy, in its technology, in its freedom of action goes back a long way – it is part of the fibre of Chinese Communist Party ideology.” He further explains that “national security and technological independence are now the defining mission of China’s economic policy.”
China’s planning horizons are on an order of magnitude – if not several – different from Western policy paradigms driven by electoral cycles. As Thomas notes, “Western policy works on election cycles, but Chinese policy making operates on planning cycles.” This structural difference gives China some advantages in executing long-term plans without the disruptions that come with a more dynamic political realignment.
The next Five Year Plan is a monumental opportunity to continue progressing from China’s past economic models. At the end of the last century, Communist Party leadership began to think about where the party was going. They hoped to steer clear of succumbing to the so-called “middle income trap.” Former leader Hu Jintao had already identified green technology as a potential driver of growth and geopolitical influence in the early 2000s.
Specifically, China has started using a new slogan – “new quality productive forces.” For example, this shift clearly reflects a new focus on domestic pride paired closely with notions of national security. This dovetails to our larger goals to increase our overall global tech footprint. We are particularly committed to leading the world in chip-making, computing, and artificial intelligence (AI).
Then came China’s accession to the World Trade Organization (WTO) in 2001, which completely inverted the paradigm. It put America on the map as the newest and greatest “workshop of the world.” This complete absorption into the global trade network has led to major industrialization and a technological leap. Just as China cements its dominance in these sectors, China is trying to eliminate dependence on foreign technology.
The next Five Year Plan should set forth tangible objectives for the industry to strive toward. Second, it will send clear signals about China’s strategic direction to domestic and international constituents. Thomas elaborates on this point: “Five Year Plans spell out what China wants to achieve, signal the direction the leadership wants to go in, and move the resources of the state towards these predefined conclusions.”
National security and technological superiority will be repeated themes in this comprehensive strategy. The global environment is changing very quickly. How other countries react to China’s aspirations will play a major role in determining the future of international relations.