NEW quality productive forces were one of the most frequently mentioned keywords for China’s high-quality development in the past year. The annual Central Economic Work Conference (CEWC) in December that reviewed the economy in 2024 and gave directions for the economic work in 2025 called for balancing fostering new growth drivers and revitalizing old ones while developing new quality productive forces based on local conditions.
This echoed what President Xi Jinping has been emphasizing repeatedly, from his meetings with deputies to the 14th National People’s Congress (NPC) to his conversations with business representatives.
Essential Path to Modernization
Xi Jinping, general secretary of the Communist Party of China Central Committee, Chinese president and chairman of the Central Military Commission, delivers an important speech at the annual Central Economic Work Conference in Beijing, capital of China.
Over the past year, Xi has repeatedly urged local governments to develop new quality productive forces. In October, during his inspection tour in east China’s Anhui Province, he was briefed on the major scientific and technological innovations made by the province, including intelligent connected vehicles, new-generation information technology, and artificial intelligence. He spoke with researchers and corporate executives and stressed that scientific and technological innovation is an essential path to modernization.
Traditionally, Anhui is one of the best performers in scientific and technological innovation in China. It developed Jiuzhang 3.0, a quantum computer prototype that can solve the Gaussian boson sampling problem, a classical quantum computing problem, 10 quadrillion times faster than the current fastest supercomputer in the world. In the China Regional Innovation Capacity Evaluation Report 2024, Anhui’s regional innovation capacity ranks seventh in the country.
After being briefed on the work of the Anhui Provincial Committee of the Communist Party of China (CPC) and the provincial government, Xi stressed the importance of developing new quality productive forces in light of local conditions, calling for the province to accelerate the transformation and upgrading of traditional industries and develop strategic emerging industries
He gave similar directions when he went to Hubei Province in central China in November on another inspection tour. He stressed that Hubei should simultaneously upgrade and transform traditional industries while fostering and boosting emerging and future-oriented industries. He also urged the province to develop new quality productive forces in accordance with local conditions and create more well-known brands.
In early March, 2024, when he met NPC deputies from the Jiangsu Province delegation, he stressed developing new quality productive forces based on local conditions too.
Under Xi’s directions, China has boosted the development of new quality productive forces. According to the latest economic data, in November 2024, China’s total value added of industrial enterprises above designated size grew by 5.4 percent year on year. In this, the value added of high-tech manufacturing increased by 7.8 percent.
The production of new energy vehicles, industrial robots, and integrated circuits grew by 51.1 percent, 29.3 percent, and 8.7 percent year on year respectively. All these serve as a testament to the steady growth of new quality productive forces.
Greater Opening Up
An aerial drone photo taken on July 3, 2024 shows a fully automated container terminal of Qingdao Port in operation in east China's Shandong Province. (Xinhua/Guo Xulei)
Over the past year, China continued to expand high-standard opening up, which was underscored at the CEWC. The meeting summarized: “The new quality productivity forces have developed steadily, reform and opening up have continued to deepen, risks in key areas have been mitigated in an orderly and effective manner, people’s livelihoods have been solidly guaranteed, and Chinese modernization has taken new and solid steps forward.”
Xi has reassured the international society of China’s resolve to open wider many times. At the opening ceremony of the 2024 Summit of the Forum on China-Africa Cooperation in September, China announced zero-tariff treatment for 100 percent of tariff lines of all least developed countries it has diplomatic relations with, including 33 countries in Africa. It made China the first major developing country and the first major economy to do so.
Then at the G20 Summit in November, Xi called for fostering an open, inclusive, and nondiscriminatory environment for international economic cooperation.
The following month he met the leaders of major international economic organizations, including Kristalina Georgieva, managing director of the International Monetary Fund, Ajay Banga, president of the World Bank Group, and Ngozi Okonjo-Iweala, director-general of the World Trade Organization, sending China’s message of greater opening up.
Xi told them China will continue to expand opening up and take the initiative to align with high-standard international economic and trade rules. It will foster a first-class business environment that is market-oriented, law-based, and internationalized. New systems will be established for a higher-standard open economy. More opportunities will be provided for the development of other countries, and more of its own development benefits shared with the rest of the world.
The commitment has been supported by actions. The latest negative list for foreign investment taking effect in November cuts the fields that are off-limits to foreign investors to 29. Notably, all restrictions on market access in the manufacturing sector for foreign investors have been removed.
In addition, China has issued a visa-free entry policy for 38 countries, allowing their citizens a maximum stay of 30 days, which will help them gain a better understanding of China. According to the National Immigration Administration, foreigners made over 8 million entries into China in the third quarter of 2024, marking an increase of 48.8 percent year on year. This included 4.8 million visa-free arrivals, representing a year-on-year rise of 78.6 percent.
Many foreign companies have expressed their confidence in China’s opening up. For example, Tim Cook, CEO of Apple, told Jin Zhuanglong, China’s Minister of Industry and Information Technology, that Apple is keen to seize the opportunities presented by China’s opening up, and will continue to increase its investment in the country.
Tasks for 2025
This photo taken on Sept. 2, 2023 shows a quantum computer displayed during the 2023 China International Fair for Trade in Services (CIFTIS) in Beijing, capital of China. (Xinhua/Ren Chao)
In the past year, China’s economic growth faced various challenges. A meeting of the Political Bureau of the CPC Central Committee in September indicated it was necessary to take a comprehensive, objective, and sober view of the current economic situation.
The meeting prescribed solutions, including “stepping up efforts to roll out incremental policies,” “adjusting the policy of housing purchase restrictions,” and “lowering interest rates on existing mortgage loans.” It was around this meeting that China launched a series of stimulus policies to tackle economic difficulties.
According to the National Bureau of Statistics, China’s economic growth shows positive signs in manufacturing and domestic demand. In November, the purchasing managers’ index of China’s manufacturing industry stood at 50.3 percent, up by 0.2 percentage point compared with the previous month, indicating acceleration in the expansion of the manufacturing industry. In the first 11 months of 2024, the total retail sales of consumer goods crossed RMB 44 trillion, up by 3.5 percent year on year, showing strong domestic demand momentum.
The year 2024 marks a crucial year of implementing the goals and tasks of China’s 14th Five-Year Plan (2021-2025). “The Chinese economy has posted generally stable performance while making progress in 2024, with solid advances made in high-quality development and major annual goals and tasks of economic and social development successfully accomplished,” the Central Economic Work Conference concluded.
It has outlined nine economic priorities in 2025, including “vigorously boosting consumption, improving investment efficiency, and expanding domestic demand in all aspects,” “leading the development of new quality productive forces through technological innovation and building a modern industrial system,” and “expanding high-standard opening up.” This will give certainty and confidence to efforts to fulfill the goals and tasks of the 14th Five-Year Plan.
