From October 20 to 23, the 20th Central Committee of the Communist Party of China convened its fourth plenum in Beijing, during which the "Recommendations of the Central Committee of the Communist Party of China on Formulating the 15th Five-Year Plan for National Economic and Social Development" were reviewed. The meeting aims to make top-level design and strategic planning for the country's development over the next five years, promoting significant breakthroughs in strategic tasks related to Chinese-style modernization. The "14th Five-Year Plan" period (2021-2025) marks the beginning of a new journey to fully build a modern socialist country following the completion of the first centenary goal of building a moderately prosperous society. Over the past five years, the world has experienced unprecedented changes, and the global situation has entered a new period of turmoil and transformation, while domestic reform and development tasks remain heavy. In this complex scenario, China's economy has withstood the waves of challenges and significant risks, making pioneering progress, transformative changes, and historic achievements, taking solid steps in the grand undertaking of building a modern socialist country.
Since the start of the "14th Five-Year Plan," the total economic volume of China has consistently exceeded 110 trillion yuan, 120 trillion yuan, and 130 trillion yuan, with the GDP expected to reach around 140 trillion yuan this year, maintaining an annual contribution rate of approximately 30% to global economic growth. The country has risen to the top ten of the global innovation index, becoming one of the fastest improving economies in terms of innovation in over a decade. Major national projects such as the Chinese space station and domestically made large aircraft have frequently made headlines, while innovations in cutting-edge fields like artificial intelligence and quantum communication have achieved remarkable results. China now boasts the largest education, social security, and healthcare systems in the world, with social undertakings becoming increasingly prosperous and public safety levels further improved. The significant accomplishments in economic and social development during the "14th Five-Year Plan" have laid a solid foundation and built ample confidence for the upcoming "15th Five-Year Plan." It is foreseeable that during the "15th Five-Year Plan," China will anchor its sights on achieving basic socialist modernization by 2035, continuing to write a new chapter of accomplishments.
According to Zhang Zhanbin, Director of the China-style Modernization Research Center at the Party School of the Central Committee (National Academy of Governance), the period from 2026 to 2035 is positioned as the sprint and decisive stage for achieving basic socialist modernization as per the targets set by the 20th Party Congress. The ongoing expansion of the super-large-scale market will see China's GDP approach approximately 135 trillion yuan in 2024, increasing its share of the world economy to 17.1%, firmly maintaining the position of the second-largest economy globally. During the "14th Five-Year Plan," China's GDP consecutively crossed the milestones of 110 trillion, 120 trillion, and 130 trillion yuan, growing from 103.5 trillion yuan in 2020 to 134.9 trillion yuan in 2024, with an average annual growth rate of 5.5%, significantly outpacing the world average of 3.9%. Over the five years, the GDP has increased by more than 35 trillion yuan, surpassing the total economic output of Germany, the world's third-largest economy, which is projected to be approximately $4.68 trillion in 2024.
In the face of global protectionism and the threats of decoupling from certain countries, China's economy has bravely navigated through challenges, maintaining its leadership in global merchandise trade. During the "14th Five-Year Plan," China's export competitiveness has continually improved, with foreign trade performance demonstrating resilience and consistently exceeding expectations. The scale of goods trade has increased from 32.2 trillion yuan in 2020 to 43.8 trillion yuan in 2024, reflecting an annual growth rate of 8.0%. Moreover, domestic demand continues to expand, with stronger driving forces behind it. From 2021 to 2024, domestic demand contributed an average of 86.8% to economic growth, with final consumption expenditure’s contribution rate rising to 59.9%, making consumption a significant engine for economic growth. The common pattern in the development of major economies is a robust internal demand market. As the second-largest economy globally, and the largest in manufacturing and merchandise trade, China cannot engage in international economic circulation through a "two-end-outside" model for an extended period.
In response to a complex external environment, China has implemented strategies to expand domestic demand, relying on a strong domestic market to enhance economic resilience and better cope with external risks and challenges. During the "14th Five-Year Plan," China has vigorously boosted consumption and improved investment efficiency while striving to comprehensively expand domestic demand. At the end of 2022, the Central Committee of the Communist Party of China and the State Council issued the "Strategic Planning Outline for Expanding Domestic Demand (2022-2035)," clearly stating the commitment to firmly implement the strategy for expanding domestic demand and nurturing a complete domestic demand system. In 2023, personal income tax deductions related to childcare, children’s education, and support for elderly family members were increased to further alleviate the financial burden on households. In 2024, the government plans to issue special long-term bonds continuously for several years to address funding challenges for significant projects, with 1 trillion yuan and 1.3 trillion yuan issued in 2024 and 2025, respectively. That year, China began promoting large-scale equipment upgrades and introducing trade-in incentives for consumer goods, focusing on key sectors like industry, agriculture, construction, transportation, education, and healthcare. Notably, the provision of subsidies between 15%-20% or predetermined amounts to support commodity consumption in key areas for residents is rare in its scale and breadth.
Looking ahead to 2025, several policy measures to expand service consumption will be introduced, providing interest subsidies for loans to service industry entities across eight consumption sectors. Retail sales of consumer goods are projected to reach 48.3 trillion yuan by 2024 and are expected to exceed 50 trillion yuan in 2025, further solidifying China’s position as the second-largest consumer market globally. With a population of 1.4 billion and over 400 million middle-income groups, China's sales of air conditioners, washing machines, and new energy vehicles lead the world, while online retail sales have been ranked first globally for 12 consecutive years. In recent years, new products and business models in the consumer sector have continuously emerged, showcasing strong performance in domestic trends. The service consumption market is growing rapidly, with significant increases in residents’ expenditures on travel, entertainment, housekeeping, education, and healthcare.
Meanwhile, investments are actively playing roles in supplementing deficiencies, optimizing supply, and facilitating circulation. During the "14th Five-Year Plan," the national comprehensive transportation network's framework, comprising “6 axes, 7 corridors, and 8 channels,” has been rapidly enhanced. Over 10,000 kilometers of high-speed rail has been put into operation, making transportation more convenient for residents and delivery services more efficient. Investment in high-tech industries has maintained rapid growth, such as the manufacturing of communication equipment, which has supported strong consumer demand for smartphones, while accelerated construction of charging infrastructure has facilitated large-scale adoption of new energy vehicles. Currently, China’s per capita GDP has exceeded $13,000, with significant consumption upgrades underway, marking critical moments for expanding and enhancing product consumption, while service consumption is emerging as a new growth engine.
Additionally, there remains enormous investment demand in the fields of industrial upgrading, new urbanization, and improving the quality of people's lives. Looking towards the "15th Five-Year Plan," the potential of China's super-large-scale market will be further unleashed, strongly supporting the stable and long-term development of the Chinese economy. Zhang Zhanbin emphasized that from 2021 to 2024, China's average annual economic growth rate reached 5.5%, almost 2 percentage points higher than the world's growth rate. The economic growth targets for the "15th Five-Year Plan" should also be maintained within a reasonable range. Based on calculations aimed at reaching the per capita GDP level of developed countries, China’s GDP growth rate from 2026 to 2035 must remain between 4.5% and 5.2%. Maintaining a growth rate of around 5% during the "15th Five-Year Plan" would sustain a relatively high level among major global economies, helping China secure a proactive position in strategic competition with the United States and continue enhancing its status in the global economic landscape.
Innovation-driven growth continues to shape new advantages, with technological innovation becoming a critical driver of economic growth. In 2024, total R&D spending across society exceeded 3.6 trillion yuan, marking a 48% increase since 2020, and securing the second position globally. Corporate R&D expenditures accounted for over 77%, making companies the primary force behind technological innovation. In 2024, the R&D intensity in China reached 2.68%, nearly matching the average levels of OECD countries. By 2025, China’s rank in global innovation indices has risen to 10th place for the first time, climbing four spots since 2020 and maintaining a leading position among middle-income economies. The accelerated integration of technological and industrial innovation is driving the transformation and upgrading of traditional industries. Currently, traditional industries like metallurgy, chemicals, machinery, light industries, and textiles are actively promoting high-end, intelligent, green, and integrated development. During the "14th Five-Year Plan," the number of newly installed industrial robots in China accounted for over 50% of the global total, while comprehensive energy consumption rates for products like steel and cement have reached globally advanced levels, significantly enhancing the reputation of traditional manufacturing while quality products sell well worldwide.
Emerging technological advancements are continually translated into new productive forces, boosting the growth of emerging industries. For example, the penetration rate of new energy vehicles has rapidly increased from 5.4% in 2020 to 40.9% in 2024, and the driving force behind this rapid growth lies in improvements in the industry’s technology levels. By 2024, total consumption of new energy vehicles exceeded 2 trillion yuan, aiding the dilution of corporate R&D costs while promoting rapid development throughout the industry chain, essentially creating a virtuous cycle. Concurrently, China is accelerating exports of its new energy vehicles, with domestic brands becoming increasingly common in European and Southeast Asian markets. The emergence of low-cost, open-source technologies like DeepSeek has demonstrated China’s capability to break through the ceiling of artificial intelligence technologies and realize the possibility of building its own AI ecosystem, triggering a reevaluation of the value of Chinese innovative assets in the global capital market.
In a recent interview, DeepSeek's founder Liang Wenfeng noted that Chinese companies had focused more on profits than innovation over the last 30 years, but said that such habits were merely a phase. Innovation requires curiosity and the ambition to create, and China’s AI sector cannot remain a mere follower. The accelerated development of AI technology in China is driving rapid industry growth across the supply chain. This year, AI chip companies, like Cambricon, have gained significant attention in the capital market, becoming a top performer in the A-share market. With the increasing demand for AI computational power, Cambricon’s chips are rapidly being deployed across operators, finance, internet, and energy sectors, leading to substantial profit increases. According to Cambricon's Q3 2025 report, the company achieved 4.61 billion yuan in revenue for the first three quarters, a year-on-year surge of 2,390%; net profit reached 1.6 billion yuan, marking a return to profitability. China has also made significant advancements in the field of innovative pharmaceuticals. During the "14th Five-Year Plan," the number of new drugs under research in China accounted for over 20% of the global total, propelling China to the second rank globally in new drug development. In frontier fields like ADC, bispecific antibodies, and multivalent GLP-1 weight loss treatments, China has achieved parity or even leadership compared to Europe and the U.S. International pharmaceutical companies have increasingly established R&D centers in China, marking the country as an indispensable player in global pharmaceutical research. This year saw record high foreign licensing transactions of innovative drugs from China, positioning Chinese innovative drugs as favorites in the global capital market.
China possesses complete manufacturing capabilities across the entire production chain for humanoid robots, with developments rapidly being integrated into factories, shopping malls, hospitals, and households. The country continues to break world records for photovoltaic silicon cell efficiency while gradually transitioning its wind energy sector from a position of cost advantage to one of technological leadership, with production volumes for photovoltaic and wind energy equipment ranking prominently in the world. The international competitiveness of China's shipbuilding and marine engineering equipment has also been increasingly highlighted, with exports of such equipment growing by 25.5% in the first three quarters of this year, along with breakthroughs in high-value-added marine engineering manufacturing sectors like floating LNG production platforms. Presently, China is also continuing to increase its investment in fundamental research, consistently enhancing its capacity for original innovation. During the "14th Five-Year Plan," China has adopted a dual approach of open exploration and goal-oriented research, vigorously supporting curiosity-driven basic research while focusing national needs through strategic R&D deployments. By 2024, funding for fundamental research reached 249.7 billion yuan, a 70% increase since 2020, yielding significant original achievements in areas like quantum technology, life sciences, material sciences, and space sciences.
China possesses the most complete industrial system, demonstrating significant scale economic effects from its vast market. The talent dividend, particularly the "engineer" dividend, is continuously strengthened, providing powerful impetus for technological innovation and industrial upgrading. Looking forward to the "15th Five-Year Plan," the opportunities embodied by technological innovation and talent advantages will be crucial, leading to further progress in achieving high-level technological independence. Zhang Zhanbin indicated that over the next decade, China must achieve substantial breakthroughs in key core technology fields, completely eliminating dependency on foreign technology, and establishing a robust level of technological autonomy. Technological innovation is the core driving force of China’s economic development. The transition of technological innovation from a model of "catching up" to "leading" is essential, aiming to position China among the forefront of innovative countries by 2035. The core task of technological innovation in the next decade is to create a fully controlled chain system encompassing "basic research - applied research - industrialization." From now on, it is critical to enhance the recognition of the importance of science and technology within society, especially among officials at all levels, regarding the importance of promoting the integration of technological and industrial innovation.
The continuous improvement of people's welfare is the ultimate goal of both economic growth and technological advancement. The stability and sustainability of China's economy are also rooted in consistently enhancing welfare and promoting inclusive growth, expanding the middle-income group, and thereby bolstering economic growth. Starting this year, a surge in TikTok users on Chinese social media has enabled ordinary Chinese internet users to directly compare living costs with their American counterparts online. Under this lens, everyday consumer goods are not only more affordable, but Chinese higher education, healthcare, and other services are becoming increasingly accessible. Unsurprisingly, although the total retail sales of consumer goods in China equal approximately 80% of America's, according to World Bank models, the actual purchasing power of China's consumer goods retail sales is 1.6 times that of the U.S. Simultaneously, top Chinese public universities like Peking University and Tsinghua University have tuition fees only 1/10 to 1/20 of their foreign counterparts.
During the "14th Five-Year Plan," China has placed a greater emphasis on stabilizing employment and implementing job priority strategies, introducing a series of employment support policies including employment subsidies, job retention bonuses, and work-for-relief programs. Over these five years, new urban employment has stabilized at over 12 million annually, and the average urban survey unemployment rate over the first four years was 5.3%, with the average rate for the first three quarters of this year at 5.2%, both below the projected control target of 5.5%. In a country with a population exceeding 1.4 billion, achieving comparatively sufficient employment is foundational to improving living standards. The stability in employment conditions provides essential support for enhancing people’s livelihoods. By 2024, the national per capita disposable income will increase to 41,000 yuan, reflecting an average annual growth rate of 5.5% since 2020 when price factors are excluded, maintaining alignment with economic growth. Relatively speaking, the per capita disposable income growth rate for rural residents has exceeded that of urban residents, further narrowing the income gap between urban and rural areas. Education, serving as the foundation of civil rights, is a vital pathway for promoting all-round human development. China adheres to the priority development of education, with fiscal education expenditures maintaining a ratio of over 4% of GDP for 13 consecutive years.
During the "14th Five-Year Plan," notable progress has been made in establishing accessible and high-quality public educational services, with the retention rate of nine-year compulsory education stable at over 95%, gross enrollment rates for preschool education reaching 92%, and the gross enrollment rate for higher education exceeding 60% by 2024, entering a globally recognized phase of popularization, with the average years of education for new labor force participants exceeding 14 years. More than 5 million students majoring in science, technology, engineering, and mathematics (STEM) graduate annually, providing a solid talent reservoir for technological innovation. Social security serves as an essential risk-sharing mechanism, playing a crucial role in providing guarantees and safety nets. During the "14th Five-Year Plan," basic pension insurance for enterprise employees has achieved nationwide coordination, while unemployment and work injury insurance have been organized at the provincial level, with the establishment of personal pension systems and pilot programs for occupational injury safeguards, effectively improving the social security system. Currently, the number of participants in the national basic pension insurance has reached 1.072 billion, increasing by over 73 million since the end of the "13th Five-Year Plan," with the coverage rate rising from 91% to over 95%. Meanwhile, the number of participants in unemployment and work injury insurance has reached 246 million and 302 million, respectively, growing by over 29 million and 34 million since the end of the "13th Five-Year Plan."
During the "14th Five-Year Plan," flexible insurance mechanisms were introduced for the large number of flexible employment individuals, allowing more people to access social security benefits. Healthcare, as a basic livelihood guarantee for public health, has seen a significant boost. By the end of 2024, the total number of medical and health institutions across the country will reach 1.09 million, with over 90% of residents able to access the nearest healthcare service point within 15 minutes. The number of practicing physicians per thousand population will increase to 3.6, enriching the supply of medical resources. During the "14th Five-Year Plan," basic medical insurance coverage remains stable at over 95% for more than 1.3 billion residents. The cross-province direct settlement of medical expenses transitioned from nonexistent to benefiting 560 million individuals over four years, easing the burden on residents employed in distant locations. Measures like centralized drug procurement at scale have lowered medicine and supply costs, enhancing access to equitable, affordable basic medical services for residents. As healthcare security levels improve, the average life expectancy in China has continuously risen during the "14th Five-Year Plan," reaching 79 years—an increase of 1.07 years since 2020 and 5 years higher than the global average.
China is also actively responding to new trends in population changes and is speeding up the construction of a high-quality service system for the elderly and children. By the end of 2024, the number of elderly care institutions and facilities will reach 406,000, providing nearly 7 million beds, with the proportion of nursing-type beds increasing from 48% in 2020 to 65.7%, continuously optimizing elderly care service provision. The "14th Five-Year Plan" also focuses on enhancing the support system for childbirth, rolling out policies like extended maternity leave, strengthened parenting services, personal income tax deductions for childcare expenses, and progressively implementing free preschool education, thereby reducing the financial burden of childbirth and parenting. Simultaneously, efforts to expand affordable childcare services have been emphasized, leading to a ratio of 4.1 childcare facilities per thousand population by the end of 2024. Currently, China's Human Development Index is steadily increasing, with continuous growth in demands for childcare, education, elderly care, and healthcare, providing significant opportunities for guaranteeing and improving public welfare. Looking ahead to the "15th Five-Year Plan," China will continue to enhance people’s welfare to meet the growing aspirations for a better life.
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