INTO TERMINAL DECLINE:

Political reports do not go into detail about specific policies (such as "zero-COVID"), but their high-level messages inform policymaking for the next five years and beyond. Xi says the most recent report constitutes a "grand blueprint" for governing China. Its content signaled continuity rather than change in Xi's personal leadership and policy agenda, drawing heavily from the most recent Five-Year Plan and the third "history resolution," both issued in 2021. Overall, it suggests that Xi will keep pushing China in a more authoritarian, statist, and nationalist direction in the coming years and even decades.

This includes the Chinese economy, where the Party plans to play a stronger role, such as by taking board seats in major firms and guiding capital towards favored sectors. The political report introduced "systems thinking" as part of Xi's ideology. According to Xi, "all things are interconnected and interdependent," as economic, political, and social reforms involve adjusting a balance of interests wherein "pulling one hair moves the whole body." China's increasingly complex policy issues therefore require enhanced Party oversight and more government "systems" to manage all aspects of the country's development.

Xi presents this increase in Party control as necessary to counter rising threats. The Party previously presented China as in a "period of strategic opportunity," in which favorable domestic and international environments enabled a focus on economic development. Xi's latest report shows that he believes China has now entered a period in which "strategic opportunity co-exists with risks and challenges, and uncertain and unpredictable factors are increasing." Moreover, the report continues, "various 'black swan' and 'gray rhino' events may occur at any time," highlighting the Party's rising concern with preparing for both unexpected crises and foreseeable threats, respectively.

Xi wants to balance economic growth with national security. The 2022 political report contained a new section devoted to national security, which should "permeate every aspect and the whole process" of governance. To prepare for "high winds, choppy waves, and even dangerous storms," Xi's report called for stronger Party leadership, people-centered policymaking, and a spirit of struggle. The report also added a section on science, education, and human capital, priority areas to bolster indigenous innovation and address the political risks of lagging productivity growth and Western chokeholds on key technologies.

Even high-single-digit GDP growth targets now seem beyond reach. Development remains the Party's "top priority," but its "primary task" is now "high-quality development." This includes elevating Xi's "new development pattern," a strategy that unites development and security goals by boosting domestic demand and homegrown technology while increasing global reliance on Chinese supply chains. Xi's political report identified new growth drivers--AI, IT, biotech, green industries, high-end manufacturing, renewable energy, and new industrial materials (such as those engineered with nanotechnology)--but was notably less enthusiastic about markets, openness, and supply-side structural reform than even his previous report in 2017. The report's vision of strategic economic management also requires the Party to expand oversight of the private sector, by "strengthening Party building" in non-state firms and "improving corporate governance" of financial firms, and of private wealth, by "regulating the mechanism of wealth accumulation."

The report suggested that Xi is preparing China for long-term strategic competition with the United States. It defined the Party's overarching goal for China as "building a socialist modern great power" by the centenary of the People's Republic in 2049, and to "use Chinese-style modernization to comprehensively advance the great rejuvenation of the Chinese nation." The Party has long wanted to achieve "modernization" by mid-century, but this report stated in the clearest terms yet that Xi wants China to "lead the world in comprehensive national power and international influence." The new link between "Chinese-style modernization" and "national rejuvenation" emphasizes Xi's determination to steer China on the Party's own course, one that rejects democratic politics, individual freedoms, and U.S. leadership in global governance. That includes efforts to "actively participate" in global human rights governance and the formulation of global security rules. Xi's report did not change Taiwan policy, but a new phrase--"resolving the Taiwan question is for the Chinese people themselves to decide"--portends more assertive pushback against U.S. and allied efforts to support Taiwan.

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