China’s economy has entered a downturn, with the announcement of the Third Plenum of the Communist Party’s political bureau meeting in July. Analysts believe that the Third Plenum has always been a meeting where the Party formulates major economic policies. It is likely to propose an economic policy “anchor,” but what the Communist Party cares most about is regime stability and security, and there is unlikely to be any reversal in China’s economy.
On April 30th, the Communist Party’s political bureau announced that the Third Plenum would be held in July. The main agenda of the Third Plenum includes reporting work to the Central Committee by the Political Bureau of the Communist Party and analyzing the current economic situation and work.
Shen Mingshi, a researcher and director at the Taiwan Institute for National Defense and Security Studies, told Epoch Times on May 1st that the Third Plenum has always been a meeting where the Communist Party formulates major policies. It’s important to see the major policies that Communist Party leader Xi Jinping will introduce in the coming years, including economic ones. “Will there be any anchoring documents or conceptual things coming out?”
Shen Mingshi said that the notice of the Third Plenum in July indicates that there may already be a certain direction on certain major policy or personnel issues.
China expert Wang He told Epoch Times that the Third Plenum is expected to present an overall strategy to outline a blueprint for the Communist Party’s next five years.
China’s current economy is in a continuous downturn. The real estate industry, which once accounted for a quarter of the country’s GDP, is experiencing a crisis with mounting debts. Foreign capital is withdrawing from the mainland, with people struggling to find jobs and unemployment rates rising. The stock market continues to fluctuate, leading stock investors to lament in the comments under the U.S. Embassy’s Weibo posts.
Li Hengqing, an economist at the U.S.-based private think tank Institute for Information and Strategic Studies, told Radio Free Asia that the most significant withdrawal of foreign investment from China occurred in 2023, after the containment measures, because they realized that China is not a society based on the rule of law. He pointed out two key points for China’s economy: the need for a market economy to determine the allocation of resources and benefits, and the constraint of power. But under Xi Jinping’s authoritarian rule, it is impossible to truly put power in a cage.
Independent journalist Cai Shenkun told Radio Free Asia that the Communist authorities cannot come up with an economic stimulus plan. If the Third Plenum had been held last year or earlier this year, the Communist Party actually did not have a clear direction for the economy.
He believes that although the Communist Party is emphasizing economic reform at the Third Plenum, it is mainly for political security. He thinks the international community should not expect any significant changes in China’s economic and political future.
“The state of the economy, the future trajectory of the economy, are not very important to them (the Communist Party). What they care about the most now is regime stability and security. Don’t hold onto the illusion that there will be any reversal in China’s politics or economy in the future,” Cai Shenkun said.