China’s leadership is meeting to address the economy. What’s at stake

Further support for high-tech industries that are considered vital for national security and future growth is all but certain, along with related industrial policies.

China’s ruling Communist Party started a four-day meeting Monday that is expected to lay out a strategy for self-sufficient economic growth in an era of heightened national security concerns and restrictions on access to American technology.

While the meeting typically focuses on such long-term issues, business owners and investors will also be watching to see if the party announces any immediate measures to try to counter a prolonged real estate downturn and persistent malaise that has suppressed China’s post-COVID-19 recovery.

“There’s a lot of unclarity of policy direction in China,” which is weighing on consumer and investor confidence, said Bert Hofman, the former World Bank country director for China and a professor at the National University of Singapore. “This is a point in time where China needs to show its cards.”

Economic growth slowed to 4.7% on an annual basis in the April to June quarter, the government reported Monday.

Chinese leader Xi Jinping addressed the closed-door meeting on Monday, expounding on a draft of its coming decision on “deepening reform and advancing Chinese modernization,” the official Xinhua News Agency said.

Security was tightened in central Beijing, as it generally is for major government events, with uniformed guards posted in some subway stations and neighborhood-watch people wearing red armbands stationed in public areas.

The decision will send a message to local government officials and others about the future direction of policy. The general expectation is that it will confirm a path laid out by Chinese leader Xi Jinping, though some hope for some fine-tuning to address concerns that increasing government control over business and society is stifling economic growth.

The Communist Party’s 205-member Central Committee is holding its third plenum, or the third plenary session of a five-year term that started in 2022. This year’s meeting was expected to be held last year, but was delayed.