China’s Next Five-Year Plan to Prioritize Domestic Consumption, Engages Public for Fresh Ideas
Beijing is actively seeking public input to shape its next half-decade of economic policy, with a clear focus on empowering consumers and building a more resilient domestic market.
BEIJING – China is laying the groundwork for its 15th Five-Year Plan with an unprecedented focus on public participation and a strategic pivot towards strengthening domestic consumption. As the nation maps out its economic and social priorities for the next five years, it is sparking a vibrant national discussion on how to best empower households and foster sustainable growth from within.
In a significant show of public engagement, a three-month campaign to solicit suggestions for the plan has already gathered over 3.11 million proposals from citizens, state media reported. President Xi Jinping has emphasized the importance of absorbing public opinion into the plan’s formulation, signaling a commitment to a people-centric approach to policymaking.
This collaborative effort comes as Beijing identifies robust domestic consumption as a cornerstone of its future economic strategy, aiming to create new avenues for growth amid a complex global trade environment.
The government is already taking concrete steps to support this goal, having recently rolled out a 30-point policy package and allocated 300 billion yuan (US$41.73 billion) for a massive program encouraging consumers to trade in old goods for new ones.
At the heart of the policy discussion is a constructive debate among leading economists and thinkers on the most effective way to achieve this goal.
One group of influential scholars, including Chang Xiuze of the Academy of Macroeconomic Research, advocates for including a “household consumption rate” as a key national target. They argue that making consumer spending a measurable goal, similar to GDP, would focus government efforts on improving the lives of ordinary people.
“Could the ‘household consumption rate’ be listed separately in the 15th five-year plan as a national ‘monitoring and assessment indicator’?” Chang wrote, highlighting that China’s rate was a “low” 39.6% in 2023.
Others, like Ding Shuang, chief Greater China economist at Standard Chartered Bank, propose a different path. They suggest focusing on tangible actions that directly boost household incomes rather than setting a broad, hard-to-enforce target.
Ding proposed concrete steps to remove obstacles to spending, such as establishing stable mechanisms for income growth and setting controllable benchmarks for civil servant salaries and minimum income standards. “These indicators,” he noted, “can also send a demonstration effect to the market, which would in turn influence overall income levels across the economy.”
This healthy debate underscores the depth and seriousness of China’s effort to build a more balanced and internally driven economy. As the Communist Party prepares to discuss the plan at its fourth plenary session in October, the wealth of public suggestions and expert analysis is providing a strong foundation for a strategic, forward-looking, and inclusive economic blueprint.
