China Century

China's next five-year plan on the way and it is a big deal for Australia

www.first2move.com.au 

When the world's second largest economy sits down to reshuffle its leadership and map out an economic plan for the next five years it is a big deal.

This week:

China's Communist Party congress starts and third quarter GDP released

Australia's employment/unemployment data should point to further strength

Resource companies' September quarter production results dropped while AGM season rolls on

It is an especially big deal in Australia given China's role as our most important trading partner.

Just what the 19th National Congress of the Communist Party of China (NCCPC) will deliver is very much open to question and its impact is unlikely to felt for some time.

What is the congress?

The NCCPC gathers every five years in Beijing's Great Hall of the People with a very select guest list of around 2,300 party elite from the provinces, bureaucracy, military and industry.

It kicks off with a set-piece, televised speech from President Xi Jinping on Wednesday.

It then largely disappears behind closed doors for a week when a reshuffled politburo pops up and details of the next five-year economic plan — number 13 in this case — are unveiled.

The headline grabber is always the ins-and-outs of the all powerful Politburo Standing Committee.

Around half the seven-member politburo needs to be replaced as they head towards the tacit retirement age, or fall from political favour.

About the only certainties are President Xi will be there to serve a second five-year term and the replacements will also be men, given gender equality is no big deal in the upper reaches of the Communist Party.

Avid China watchers will then assess an array of largely incomprehensible party semiotics to see whether President Xi is more or less powerful than before. The betting is he will emerge more powerful.

What will we learn?

President's Xi speech will detail the latest group-think on China's economy, what its ambitions are and how they will be achieved by 2020 and beyond.

By the end of the week the constitution will be re-jigged with new ideological and policy positions to hit the targets.

The plans generally entail some big concepts such as the "One Belt One Road" policy, supply-side reform (closing down inefficient industry) and the more recent "Made in China 2025" strategy.

Given those three policies are all closely linked to President Xi there is unlikely to be much change in economic policy in the near term.

Ultimately, China's goal is to take a much larger chunk of the global economy by whatever means are at hand.

(Source: Australian Broadcasting Corporation )