China’s 14th 5 Year Plan and the Greater Bay Area
30 November 2020
By Kevin Tan
The 14th Five Year Plan was drafted from 26 to 29 October 2020, at a time where China’s main concerns were worsening US-China relations and the COVID-19 pandemic. The drafting was done during the fifth plenary session of the 19th Communist Party Central Committee and was presided over by General Secretary, President Xi Jinping himself. As per usual, independent media was not allowed and conclusions had to be drawn from the proposal documents published after.
The key theme of the proposal was the prioritization of quality, rather than quantity of growth in China. We can look back at the 6.5% GDP target established during the 13th Five Year Plan, and compare this to the 14th Five Year Plan that lacks a numerical growth target.
A wide range of goals were established:
Becoming a powerhouse across all sectors - becoming a “modernized socialist country and well-off society, in an all-round way”
Increased GDP for both rural and urban populations, through industrialisation, informatisation, urbanisation and agricultural modernisation - showing a desire to grow the middle-class
Adopting green modes of production to lower carbon emissions and transition to a society with green vehicles
International economic cooperation and competition to be strengthened through an open economy
Innovation-driven development through becoming a powerhouse for science and technology, by supporting the development of high-quality research universities
Breaking apart industry monopolies and local protections to create a local virtuous cycle
Generous healthcare investment to help with human development and an aging population
Strengthen Chinese Communist Party (CCP) leadership and national defence, while rallying around President Xi Jinping
Many infrastructure projects were mentioned in the proposal, with their intention to move toward these goals
Transport and trade - Sichuan Tibet Railway, New Western Land Sea Corridor, National Water Network
A national water network with hydropower development on the Yalong Tsangpo river
Interplanetary exploration, BeiDou satellite navigation commercialization
We were excited to see the mention of the Greater Bay Area (GBA) in the proposal. It was mentioned as a site to develop China as a science and technology platform powerhouse, through the setting up of centres of technology transfers from research centres to enterprises. The GBA’s international appeal was recognized, and it would be supported as a global hub for international innovation and aviation. Lawmakers even proposed an EU-style passport for GBA services for connectivity. As such a Chinese-foreign cultural and art exchange centre would also be in the works.
The other main implication of the meeting on the GBA was the plan to strengthen the management of Hong Kong by revamping the electoral system. The National People’s Congress (NPC) expressed intention for the “patriots to govern”, through an alteration of size and composition of the Hong Kong election committee and legislative council in favor of pro-Beijing leaders. Compared to the 13th Five Year Plan, the 14th Five Year Plan implied there would be much more involvement of Hong Kong in the Chinese economy. A barometer for this was the significantly increased number of words dedicated to Hong Kong in the 14th Five Year Plan proposal. Interesting initiatives mentioned included P&G setting up a technology innovation centre in Guangzhou, as well as the trialing of digital currencies in Shenzhen, Guangdong and Hong Kong.
Ultimately, we view the 14th Five Year Plan as optimistic for the GBA. The CCP has recognised the region’s global appeal and has showed intention to develop its potential. Our view is that the GBA will be governed more tightly, yet experience increased connectivity between Greater China and the West.
