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China Leadership Says Economy Will Reach Mid-Level Within 15 Years

Chinese leaders vowed Thursday to pull China’s per-capita output levels up to that of “the middle level of developed economies” within 15 years, an ambitious task that economists say will require China to triple its current level by 2035, putting it roughly on a par with developed nations like South Korea and Spain.

The gross domestic product target came as China unveiled the proposal for its 14th five-year plan, which covers 2021-2025, as well as a medium-ranged development plan that ends in 2035. The plans are a vestige of China’s roots as a Soviet-style planned economy, setting out the government’s longer-term priorities.

The document came after a four-day closed-door meeting, and toward the end of a volatile year marked by a global pandemic and geopolitical confrontation with the U.S., both of which have forced Beijing’s leaders to rethink their economic game plan.

Thursday’s proposal largely steered clear of precise numerical targets, instead laying out a range of priorities, including a call for more domestic consumption and self-reliance in science and technology — an area of focus that was mentioned 11 times, versus four times in the previous five-year plan.

China’s Communist Party said that it would realize “sustainable, healthy economic development” over the next five years, in part by boosting domestic consumption, according to the document, which was carried by China’s state-run Xinhua News Agency.

It said that household income growth, which has lagged behind headline GDP growth in recent years, would make up the difference. And the party also pledged to deepen its commitment to attracting foreign investment, while accelerating more environmentally friendly development.

In one new phrase, party leaders said that China’s per capita GDP would reach the “middle level of developed economies” by 2035, shortening the time frame for a target that the late paramount leader Deng Xiaoping said in 1987 that China would accomplish by 2050.

Chinese economists said that the phrase referred to per capita GDP levels of about $30,000 a year — somewhere between South Korea and Spain’s 2019 levels of $31,762 and $29,614, respectively, according to the World Bank.

The full text of the coming five-year plan and the fifteen-year plan, which is expected to include more specific economic and social targets, is expected to be released at China’s annual legislature meeting in March.
Source: Dow Jones

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