Premier Li Keqiang delivered the annual Government Work Report at the Great Hall of the People before assembled delegates of the National People’s Congress on May 22, 2020. It was a defining moment in the wake of the most devastating public health crisis that China has had to face in its modern history. Moreover, the coronavirus pandemic that is ravaging the world today is an ongoing crisis for which China must take specific remedial economic measures to address.
Unlike certain Western countries that have politicized coronavirus in the context of social divide and rule before electoral cycles, China has focused entirely on controlling the pandemic, preventing future waves, and addressing the problems left in its wake, namely employment, globalization decoupling, and the need for remedial environmental policies that can be effective in the long run.
Beijing economic policy is concerned more with the overall health of the economy. This session of the NPC will approve a 1 trillion yuan bond issue specifically for COVID-19 control, while pursuing prudent monetary policy involving reductions in reserve rations and interest rate cuts together with re-lending to increase M2 broad money supply, while making lending to small- and medium-sized enterprises both more convenient and accessible. Everything is focused on the real economy with skill training to enable more than 35 million vocational jobs.
This year’s report also set a framework for quality versus quantity in overall life improvements. Where past programs have focused on fixed asset infrastructure investments to drive the economy and create new jobs, this year a fresh concept is on the table called “new infrastructure” to solve actual snags in the economic system to keep arteries of supply and demand smoothly running and preventing snags in the supply chain that can create economic distortion.
Following from this year’s report, it is clear that China’s will be pursuing comprehensive, balanced economic development by addressing all levels, sectors and geography together. Emphasis will be placed on “new infrastructure,” which can be defined as smart, green and blue.
Policy will focus on the total health of the economy requiring a re-balancing between overly developed coastal megalopolis cities and the lesser-developed rural landscape of the interior. While past development weighed on heavy infrastructure and industry, the new focus will be on corrective environmental technologies and an overarching matrix shift in the energy grid from fossil fuels to green energy.
Toward achieving such an economic transformation from the current stage that has emphasized industrial production and export trade as the focus, there will be a shift toward re-development of the interior calling for infrastructure that is smart, green and blue. Seven fields have been identified as the focus: 5G infrastructure, ultra-high-voltage intercity high-speed railway systems, urban rail transit, new energy vehicle charging stations, big data centers, artificial intelligence, and industrial internet to enhance data collection, exchange, and analysis to enhance productivity efficiency.
The report focused on developments in technology, artificial intelligence, and big data. These are key components in the massive transition underway in China from fossil fuel reliance to green energy. Moreover, these technology sectors are key in upgrading China’s public health sector. Throughout the coronavirus crisis, new technologies were applied proving the necessity of correctly applied technology to solving health care challenges.
China has set the ambitious yet realizable target of shifting the energy grid to eighty percent green by 2050. This energy transition will also seek to address blockages in transport through investment in high-speed rail networks that are both intra and inter city. Moreover, aggressive promotion of electric vehicles will witness a transition in the auto industry to drastically reduce carbon output. Auto industry insiders in Beijing know that all of the major vehicle manufacturers are focused on designing and producing the next generation of electric vehicles including some of the really big luxury car brands present in the China market today. It will go way beyond Tesla as the only electric car of the rich and elite. Electric vehicles will become predominant if not mandatory in China. This year’s NPC infrastructure approvals include a blueprint of 1.2 million ultra-high-voltage charging stations across the country.
A large portion of this year’s report addressed poverty alleviation, the focus of which will be development of China’s western regions, setting an ambitious target to achieve modernization of all western regions by 2035. China’s western development has been an ongoing three-decade process that has involved layers of different types of investment from the earlier rail and road infrastructure. This crucial stage will witness the re-configuring of ecological cities that can offer the same if not even better, at least newer, facilities for health, environment and new technology development within the areas that have previously been designated as rural and agricultural.
Author: Laurence Brahm is an award winning documentary film director and Himalayan explorer, and he is also a senior international fellow at the Center for China and Globalization.
The opinions expressed here are those of the writer and do not represent the views of New Silkroad Discovery and New Silkroad Discovery website.