"The National People's Congress will be a difficult balancing act"

How much is the NCP overshadowed by COVID-19?

The epidemic hit China hard. The Chinese Communist Party's (CCP) socioeconomic goals are at risk and the outbreak in Wuhan exposed major systemic weaknesses, especially in crisis management. China is facing an "unprecedented challenge", party leader Xi Jinping said recently, and the economic effects of the outbreak will be felt for a long time. To create some positive sentiment, this parliamentary session will likely be framed as “the people’s NPC". It will be a difficult balancing act. The Chinese leadership must cast itself both as a successful crisis manager and as a credible advocate of the people. It has to signal the government has learned from the crisis and is taking the people’s welfare and economic needs seriously. 

Can the leadership reach its economic and social development goals this year despite the coronavirus crisis?  

Important milestones are on the horizon this year as the CCP celebrates its 100th birthday in 2021. Economic output is meant to double compared to 2010 (which would require annual GDP growth of six percent), poverty is meant to be completely eliminated, and the 13th Five-Year Plan, with its various goals for the economy and society, is meant to be implemented successfully. Every effort will be made to achieve these goals – through investment programs in digital infrastructure, for example, or concessionary loans for small and Medium-sized enterprises (SMEs). But how achieving these political milestones will be financed remains an open question.  But the party leadership will not fail to celebrate any success as proof of its leadership skills. 

Do you expect the Chinese leadership to publish a growth target for 2020?  

It would be a first if no target is set at all. It’s possible that Beijing wants to signal its self-confidence by naming a number. With real growth likely to be around three percent growth rather than the six percent previously targeted, that seems unlikely. That would be the lowest value in decades – but probably still the highest worldwide this year. But I also think it is possible that Li Keqiang could announce a more flexible target – for example, a growth range for GDP.

Do you expect legislative changes in the health sector and for epidemic control?

Yes, I expect a number of measures in this area. New laws and legislative changes were already introduced in immediate response to the coronavirus. These included a law on the prevention of animal epidemics, a law on wildlife protection and a biosecurity law. The sale and consumption of wild animals has already been prohibited by them. But there are a number of other rules and laws to prevent and manage epidemics on the NPC’s agenda.

Health-care reforms have long been a priority, and the crisis has underscored the urgent need for health-system improvements. The coronavirus crisis has driven digitization forward in particular, but also raised pressing questions about the financing of health insurance. More efficient crisis management and better epidemic control will certainly also feature – China will also be keen to present itself as a global leader in these areas. Whether this will lead to fundamental changes remains doubtful. After the SARS epidemic in 2003, China announced changes – and in some cases even initiated. But China was still hit harder this time.

What important resolutions and laws are on the agenda?

Important and much discussed in China is the new civil code that is on the NPC’s agenda. It is meant to improve protections of personal rights, privacy and personal data – important not least because personal health and travel data were collected on a grand scale during the crisis.  

China's trading partners should, among other things, keep an eye on the adoption of the Export Control Law. It is meant to regulate China's exports more clearly – even if latest draft it still raises questions, for example about dealing with re-imports and so-called blacklists.

In how far will international tensions impinge on the NPC?

The plenary session is focused on domestic policy. But external factors naturally play into economic development and the political priorities that Prime Minister Li will outline on Friday. China's short- and medium-term prospects remain strongly dependent on the trade war with the US. Beijing sees itself under pressure to become more independent of external economic developments, while at the same time trying to control them better. China will strive for self-sufficiency even more so than before. But beyond indirect references to "major challenges in the international arena", I do not expect Li Keqiang to use his report to the NPC to explicitly talk about the US or to recent statements by US President Trump.

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