context: Heightened pressure on the economy was no longer news by Q3 2021, and this was featured even more prominently at the tone-setting Central Economic Work Conference (CEWC) for 2022. Reform of the ‘deep water zone’ in the economic structure inevitably slows growth. Coupled with supply-side fluctuations, geopolitical tension and pandemic uncertainties, threats loom over the big picture. But stability is always the unchallengeable overriding theme, which means a temporary shakeup of policy priorities would not be surprising.
The annual CEWC (Central Economic Work Conference), held 8-10 Dec 2021, discussed major policy directives for 2022. The conference readout states the economy is facing ‘threefold pressure’, namely
- shrinking demand
- supply shock
- weakening outlook
But there remain key points to adhere to, including
- high-quality growth
- innovation-driven growth
- supply-side structural reform
- ‘six stablities’ and ‘six guarantees’ for basic livelihood issues and grassroots governance
In 2022, economic work should
- put stability at the top of the agenda
- seek growth based on stability
- actively introduce policies conducive to economic stability
- appropriately frontload economic support
Seven key policy directives were outlined, namely
- stable and effective macro policies
- micro-policies to stimulate market players
- structural reform to smooth the economic cycle
- scitech policies to push forward research and innovation
- expanding reform and opening-up
- regional policies to enhance the balance and coordination of development
- social policy based on the safety net of people’s livelihood
The main problems to address include
- strategic goals and practical approaches to achieve common prosperity
- characteristics and behaviour of capital and how to manage it
- guaranteeing primary product supply and food security
- managing and resolving major risks
- the route to carbon peaking and neutrality
Of note, attention was also given to the importance of the 20th Party Congress scheduled for H2 2022, a ‘major event in the political life of the Party and the state’. Accordingly, CEWC called for maintaining
- a stable and healthy economic environment
- a peaceful social environment
- a clean political environment