The ‘two sessions’: what to watch for during China’s biggest political event of the year

The first day of the legislative session on Tuesday will get more attention, when Premier Li Qiang will deliver his maiden government work report in front of nearly 3,000 National People’s Congress deputies.
Premier Li Qiang will deliver his first work report on Tuesday. Photo: Xinhua

Li will outline how the economy has performed in the past year, including the closely watched GDP growth rate, and set out the new growth target, policy agenda and budgets for the year ahead.

In the days that follow – it is not yet known how long the meetings will run for – the work report, budget and other bills in the legislative session will be deliberated and generally rubber-stamped.

Other events to watch will be the foreign minister’s press conference, President Xi Jinping’s speech to wrap up the event, and the premier’s news briefing after the closing ceremony.

GDP and the budget

The premier made an early and unexpected disclosure at the World Economic Forum in January when he revealed that China’s gross domestic product grew by 5.2 per cent in 2023 – the target was 5 per cent.
Li was seeking to boost confidence in the world’s second-largest economy after a choppy year of recovery from the pandemic that has seen property developers defaulting on debt, sluggish domestic consumption and weak overseas demand.

China also faces an ageing population and a shrinking workforce as a result of the notorious one-child policy from the late 1970s, and a low birth rate, even after the policy was relaxed in 2016.

The world’s second-largest economy has had a choppy year of recovery from the pandemic. Photo: AP

Analysts are expecting China to set a similar target growth rate of 5 per cent for the coming year. But which policy tools the government uses to achieve this – such as fiscal stimulus or structural reform – remains to be seen.

Neil Thomas, a Chinese politics fellow at the Asia Society Policy Institute’s Centre for China Analysis, said this year’s two sessions would be significant.

“China’s trajectory has never seemed more uncertain during the Xi era, so people inside and outside the country are looking to the leadership for reassurance that they understand China’s economic problems and know how to solve them,” he said.

The premier’s report is likely to talk about boosting “new productive forces” – a term used by the leadership to refer to home-grown innovations in technology and services that it believes could boost the economy and self-reliance.

Li will also hand down the budget. Annual financial reports are usually deliberated on the first day of the NPC and released later in the week.

Defence spending will be closely watched at a time when tensions are soaring over self-ruled Taiwan and the South China Sea. The People’s Liberation Army has stepped up its military activities in the region and the 2027 target to achieve its modernisation goals is not far off.

Analysts expect steady growth in the defence budget in line with economic growth and last year’s increase of 7.2 per cent.

What about Li?

Li will wrap up his first year as premier with a policy address and press conference that will give more insight into his role and style.

A tally of Li’s inspection trips and meetings found that his focus has been more on domestic issues than foreign affairs compared to his predecessor.

And Li’s say on economic affairs within the party-state system appears diminished compared with previous premiers, according to Alfred Wu, an associate professor at the National University of Singapore’s Lee Kuan Yew School of Public Policy.

That was especially the case after China’s cabinet amended its work rules to focus on the “implementation” of party decisions, Wu said, adding that Li’s role “is actually not comparable to his predecessors”.

He expects Li to deliver a shorter work report than previous premiers.

Foreign affairs

The focus of the two sessions is largely domestic, but the foreign minister’s briefing will set the tone for diplomacy.

Thomas from the Asia Society Policy Institute said Beijing could be expected to “avoid antagonism” ahead of key elections in the West.

He said the foreign minister was also likely to “emphasise stability” as Beijing seeks to improve the business confidence of foreign investors.

The briefing could also touch on relations with the US, which have improved since last year’s meetings that took place soon after the US shot down an alleged Chinese spy balloon.

Wang Yi could be replaced as foreign minister during the two sessions. Photo: AFP
There is also the matter of who will be the next foreign minister. Wang Yi, China’s top diplomat, went back to the role in July after Qin Gang – who has been absent from public view since June – was abruptly dismissed from the job without explanation.
Liu Jianchao, head of the ruling Communist Party’s International Liaison Department, is seen as the leading contender to replace Wang and it could happen during the two sessions if Beijing opts for a high-profile announcement.

Military purge

There are other uncertainties, and announcements could be made during the legislative meeting.

The third plenary session of the Central Committee – the party’s biggest decision-making body – usually takes place in autumn, shedding light on the economic direction and key appointments ahead of the two sessions.

But it has not been held this year and observers suggest that could be because there are decisions pending over a purge of military officials and the foreign minister’s sacking.

Li Shangfu was removed as defence minister without explanation in October, and nine generals were ousted from the legislature in December. They were accused of “violations of discipline and law”, a euphemism for corruption.
Li Shangfu was removed as defence minister in October. Photo: EPA-EFE

Dong Jun has been named the new defence minister but he has yet to be appointed as a state councillor – a title usually also given to the foreign minister.

A “dismissals and appointments” bill was approved during a meeting of the NPC Standing Committee this week, but no further details were given, though it did confirm that Qin had resigned as a member of the legislature.

For now, Qin and Li Shangfu both remain full members of the Central Committee.


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