Ambassador Xie Feng of China to the United States gave an exclusive interview to a senior reporter from Newsweek, explaining the spirit of the Third Plenary Session of the 20th CPC Central Committee
2024-08-07
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On August 2, 2024, Ambassador Xie Feng of China to the United States accepted an exclusive interview with Tom O'Connor, a senior foreign policy reporter for Newsweek, explaining the spirit of the Third Plenary Session of the 20th CPC Central Committee. The interview was published on the front page of the website of the weekly on August 5. The main contents are as follows:
O'Connor: What are the most important themes and signals of the Third Plenary Session of the 20th Central Committee of the Communist Party of China?
Xie Feng: The theme of this plenary session is to further comprehensively deepen reform and promote Chinese-style modernization; the most important achievement is the review and approval of the "Decision of the CPC Central Committee on Further Comprehensively Deepening Reform and Promoting Chinese-style Modernization", which has drawn up a new blueprint for further comprehensively deepening reform and promoting Chinese-style modernization. "Reform" appeared 145 times as a high-frequency word in the "Decision", and "opening up" appeared 35 times.
Since the reform and opening up, the Communist Party of China has held two epoch-making Third Plenary Sessions: in 1978, the Third Plenary Session of the 11th Central Committee opened a new era of reform and opening up and socialist modernization; in 2013, the Third Plenary Session of the 18th Central Committee opened a new journey of comprehensively deepening reform and promoting reform through systematic and overall design in the new era. The Third Plenary Session of the 20th Central Committee, which just concluded, is a new milestone, and the important message it sends is that China's reform and opening up will not stop.
The world is in turmoil, and the global economic outlook is becoming more uncertain. Every family has its own problems. How to deal with it? Some countries choose to take advantage of their neighbors and treat their internal problems externally. China insists on turning the knife inward, and through comprehensively deepening reforms and improving systems, preventing and defusing risks, responding to challenges, and achieving mutual benefit and win-win results. This plenary session proposed more than 300 important reform measures involving systems, mechanisms, and institutions, and made it clear that they must be completed by the 80th anniversary of the founding of the People's Republic of China in 2029, showing the firm determination and confidence to carry out reforms to the end. Looking around the world, which other country can promote such a large-scale, large-scale, and intensive reform in such a way that it does what it says and seizes the day?
China's reform and opening up has gone through 46 years. Unlike the past process of crossing the river by feeling the stones and single-point breakthroughs, the "low-hanging fruits" have been picked, the delicious "meat" has been eaten, and the remaining ones are the "hard bones" that are difficult to chew. Now China's economy contributes more than 30% to the world's economic growth, and has a global impact. Every move must be cautious. Ordinary people are no longer satisfied with just having enough to eat, but also demand to eat well. The cake must not only be made bigger, but also must be divided well, and higher requirements are placed on social fairness and justice. Therefore, reform must be more precise, more systematic, and more comprehensive to respond to the expectations of the people and the world.
O'Connor: The Chinese economy is facing challenges in consumption, the real estate market, and local government debt. How is China prepared to respond?
Xie Feng: China is in the critical period of transforming its development model and optimizing its economic structure, and it is inevitable that it will encounter some "growing pains". These problems are problems in development and transformation, and they can be completely overcome through hard work. In fact, the history of China's reform and opening up is a process of constantly discovering and solving problems.
How to solve these problems? The answer given by this plenary session is to promote high-level opening up and achieve high-quality development. We will continue to promote development through reform, seek momentum from reform, further liberate and develop productivity, and provide strong impetus for China's modernization.
First, we will work on both the supply and demand sides. We will vigorously develop new quality productivity, promote the high-end, intelligent and green development of "old" industries, cultivate "new" industries such as artificial intelligence, aerospace, and biomedicine, and promote the deep integration of the real economy and the digital economy.
China's consumer market continues to expand and improve. Last year, consumption contributed 82.5% to China's economic growth. Currently, China has 400 million middle-income groups, which will increase to 800 million in the next decade. It is estimated that for every 1 percentage point increase in the proportion of China's middle-income groups, consumer spending will increase by more than $150 billion each year. China's urbanization rate is only about 66%, which has a lot of room for improvement compared with the level of about 80% in developed countries. Every 1 percentage point increase in China's urbanization rate can drive about $140 billion in new investment and $28 billion in new consumption, which will effectively promote real estate development. We will continue to improve the systems and mechanisms for urban-rural integrated development, regional coordinated development, and the protection and improvement of people's livelihood, and further stimulate the release of domestic demand potential. Recently, the State Council of China issued the "Five-Year Action Plan for Deeply Implementing the People-oriented New Urbanization Strategy", proposing to implement a new round of urbanization of agricultural migrant population, and nearly 300 million Chinese migrant workers will enjoy the same basic public services as urban residents.
Second, we need to combine the long-term and short-term. We need to stabilize growth in the short term and increase stamina in the long term. Recently, we have arranged about 300 billion yuan of ultra-long-term special treasury bonds to increase support for large-scale equipment renewal and old-for-new consumer goods. In response to new changes in the supply and demand relationship in the real estate market, we are accelerating the construction of a new model for real estate development, focusing on meeting rigid and improvement needs, increasing the construction and supply of affordable housing, fully empowering city governments with the autonomy to regulate the real estate market, and building "good houses" that meet the people's new expectations. In response to local government debt risks, we will "open the front door" on the one hand, expand local tax sources, increase local independent financial resources, clarify the direction of consumption tax reform, appropriately expand local tax management authority, and reasonably expand the scope of support for local government special bonds; on the other hand, we will "block the back door" and establish a full-caliber local debt monitoring and supervision system and improve the government debt management system.
O'Connor: Given these challenges, do you think China's economy can achieve its target of growing by around 5% this year?
Xie Feng: In the first half of this year, China's economy has stabilized and improved, with both quantity and quality improving. In terms of "quantity", the month-on-month growth rate of GDP has been positive for eight consecutive quarters, and the year-on-year growth rate in the first half of the year was 5%, ranking among the top major economies in the world. The added value of 39 industries in 41 major industrial categories has increased, which is a higher quality, more efficient, fairer and more sustainable development. In terms of "quality", the industry is accelerating its transformation to "new" and "green", and the investment in high-tech industries has increased by 10.6% year-on-year. The output of new smart green products such as integrated circuits, service robots, new energy vehicles, and solar cells has maintained double-digit growth, and new momentum has accelerated its growth. Bloomberg predicts that the proportion of China's technology industry in GDP is expected to expand to 23% by 2026. The IMF and other international institutions have raised their expectations for China's economic growth this year to more than 5%.
China's economy still faces many difficulties and challenges, but the stable and long-term positive development trend will not change. The continued expansion of the manufacturing industry will provide supply support; summer tourism, the start of the school season, and the "National Day" holiday will set off a new consumption boom, and there is broad investment space in weak areas and new tracks, which will provide demand support; the transformation and upgrading of traditional industries and the continuous growth of emerging industries will provide dynamic support; ultra-long-term special government bonds and special bonds will provide policy support.
China is confident that it will not only achieve its annual economic and social development goals, but will also accumulate inexhaustible momentum for long-term sustainable development.
O'Connor: China continues to open up in an unstable environment. Will the Third Plenary Session of the 18th CPC Central Committee reduce the emphasis on the market and place more emphasis on the government's influence on the economy?
Xie Feng: How to properly handle the relationship between the government and the market is a global problem. China combines an effective market with an effective government, making good use of the "invisible hand" to give full play to the decisive role of the market in resource allocation, optimizing resource allocation efficiency and maximizing benefits; it also makes good use of the "visible hand" to improve the macroeconomic governance system, better maintain market order, make up for market failures, and stimulate the endogenous motivation and innovation vitality of the whole society.
The Third Plenary Session of the 18th CPC Central Committee continued to emphasize the need to give full play to the decisive role of the market in resource allocation and to better play the role of the government, and made important reform arrangements in terms of removing market access barriers, promoting market-oriented reform of factors, and improving the basic system of the market economy. The Decision clearly stated that it is necessary to continue to deepen the reform of state-owned assets and state-owned enterprises, and promote market-oriented reform of competitive links in industries such as energy, railways, telecommunications, water conservancy, and public utilities; at the same time, it provides more opportunities for the development of the non-public economy, formulates a law to promote the private economy, and ensures that all types of ownership economies can use production factors equally in accordance with the law, participate in market competition fairly, and receive equal legal protection.
All these show that China's attitude of adhering to the market-oriented reform orientation has not changed. We will continue to work hard to let the "invisible hand" and the "visible hand" play their respective strengths and work together to continuously release development potential.
O'Connor: The world is currently full of turmoil and instability is increasing. Will this affect China's continued promotion of reform and opening up?
Xie Feng: As some countries are "closing their doors", "building walls" and "decoupling", openness has become a "scarce commodity" in the world. But China insists on "opening its doors", "building roads" and "linking up" to share the dividends of reform and development with the world. "No matter how hard the wind blows, it will still be strong." No matter how the international situation changes, we will insist on doing our own thing well and doing the right thing. China will continue to take the initiative to open its arms to the world, and we also look forward to the world opening its arms to China.
Opening up is a distinctive symbol of Chinese modernization. This plenary session introduced many real measures. The first is to "subtract", including continuing to reduce the negative list of foreign investment access, implementing the "zero" requirement for restrictive measures on foreign investment access in the manufacturing sector, and fully implementing the negative list of cross-border trade in services. The second is to "add", including steadily expanding institutional opening up, actively connecting with international high-standard economic and trade rules, and creating a transparent, stable and predictable institutional environment; expanding independent opening up, and promoting orderly opening up in the fields of telecommunications, the Internet, education, culture, and medical care. The third is to "equalize", treat domestic and foreign-funded enterprises equally, and guarantee national treatment for foreign enterprises in terms of factor acquisition, qualification licenses, government procurement, etc.
A more open China provides more market opportunities and growth opportunities for the world. Foreign investment in China has accelerated. In the first half of the year, 26,870 new foreign-funded enterprises were established in China, a year-on-year increase of 14.2%, attracting nearly 500 billion yuan in foreign investment, which is at a 10-year high. Another Tesla super factory started construction in Shanghai, and it took only one month from negotiation to signing. Apple has established R&D centers in Beijing, Shanghai, Shenzhen and Suzhou, and its R&D personnel in China have doubled in the past five years. BMW has established the world's largest production base and the second largest R&D system in China. A recent report by the China Council for the Promotion of International Trade shows that more than 40% of the foreign-funded enterprises surveyed believe that the attractiveness of the Chinese market has increased, among which American enterprises are most optimistic about the Chinese market, and nearly half of the foreign-funded enterprises surveyed expect their profit margins in China to increase in the next five years.
Foreign capital "votes" with its feet. China is not only the "world factory", but also the "world market"; it not only has "Made in China", but also "Smart Manufacturing in China"; it is not only an important engine of global economic growth, but also a rare value depression and investment highland. We welcome more companies to seize the opportunities of China's development, share the dividends of China's development, and achieve greater development of their own.
O'Connor: Chinese media reports on this meeting were mostly positive, but some Western media held different views. What do you think caused this "temperature difference"?
Xie Feng: "Hearing is false, seeing is believing". Recently, China's visa-free "circle of friends" has continued to expand, and it has also implemented a 72-hour or 144-hour transit visa-free policy for people from 54 countries, including the United States. Many foreign tourists have seized the opportunity to experience China. In the first half of this year, the number of foreigners entering the country reached 14.635 million, an increase of 152.7% year-on-year, of which visa-free entry increased by 190% year-on-year. "City is not City" has become popular on the Internet, and "China Travel" has become a traffic password. Foreign tourists visit night markets, walk on the streets, take cruise ships, take high-speed trains, learn square dances, take driverless taxis, and experience drone delivery. They have experienced an open, safe, vibrant, hospitable, and real three-dimensional China. Many travel videos are titled "Unexpected China" and "China that Western media don't want you to see". Some netizens commented: "China is not our enemy" and "We are all residents of the earth and need to know how to coexist peacefully."
We welcome people from all walks of life in the United States to visit China for exchanges, study, work and live, and have introduced a number of convenient measures: American citizens applying for tourist visas to China are exempted from providing air tickets, hotel reservations, itineraries, invitation letters and other materials; applicants who meet the conditions for ten-year multiple-entry visas will be appropriately issued with longer-stay visas; visas that meet the conditions can be obtained within four working days. The "Decision" of this plenary session specifically mentioned that it will improve the living convenience systems for entry, residence, medical care, payment, etc. for foreign personnel. A few days after the plenary session ended, the Ministry of Commerce and seven other departments jointly issued the "Notice on Several Measures to Facilitate Accommodation for Foreign Personnel in Serving High-Level Opening Up". In the next step, we will continue to optimize measures to facilitate personnel exchanges, so that foreign friends can travel in China more conveniently and comfortably. Welcome everyone to take a "go-anywhere" trip to China and meet a different and wonderful China! (Source: Ministry of Foreign Affairs website)
[Editor: Hu Hanxiao]
Source: Ministry of Foreign Affairs website
