During the commencement of the National People’s Congress of the Communist Party, the departing premier Li Keqiang affirmed an increase in defense spending.
In an address to the Communist Party’s rubber-stamp parliament, the outgoing premier of China stated that the country has established a target of 5% GDP growth for 2023. This aim is on the lower side of analysts’ forecasts and follows a 2022 figure that fell significantly short of the objective.
During the speech of the “work report” on Sunday, foreign affairs were also addressed, and the Chinese Communist Party (CCP) reiterated its goal to annex Taiwan. The budget documents confirmed a 7.2% increase in defense spending, which is slightly higher than the previous year’s increase of 7.1%.
In what is possibly his last significant speech before stepping down as China’s premier, Li Keqiang inaugurated the annual session of the National People’s Congress (NPC). The work report, which necessitated approval from the CCP leader Xi Jinping, outlined the government’s primary accomplishments from the previous year and its plans for the future.
This year’s conference is of particular importance as it denotes the transition from one political term to the next, after Xi’s extraordinary third term as the party leader was confirmed in October.
At the start of his speech, Li acknowledged that the country’s economy had been impacted “beyond our expectations” by Covid-19 and other domestic and global factors.
Li announced that the government’s goal is to generate approximately 12 million urban jobs while maintaining the urban unemployment rate at 5.5%, as it was in December. This allows for some flexibility in the targets.
According to Professor Victor Shih at the University of California, San Diego, the targets are “not excessively ambitious” and provide an opportunity for the incoming new premier and the government to achieve a potential “easy victory.”
According to him, the reason for not advocating a significant stimulus package is due, in part, to the acknowledgment that China’s export industry, which has been a major contributor to its economic growth over the past three years, is unlikely to perform as well in the upcoming year.
The speech also included commitments to address housing problems faced by young people, enhance welfare provisions for the elderly, and enhance the system of support for childbirth. In recent weeks, the Chinese Communist Party (CCP) has revealed several policies aimed at encouraging people to have more children and reversing the declining birth rate.
Shih stated that the proposed measures to enhance welfare benefits and promote consumption, which were emphasized in Li’s speech, would necessitate substantial financial resources from the government.
Therefore, in Shih’s view, many of these proposals may be viewed as empty promises, as the origin of the funds required for their implementation is unclear, unless the country experiences a miraculous economic growth far beyond current expectations.
Li’s speech lasted for slightly less than an hour and also addressed the “Taiwan question,” which is a significant issue and source of anxiety for the Chinese Communist Party (CCP).
The CCP asserts that Taiwan is a part of China and has pledged to bring it under its control, preferably through peaceful means but with the use of force if required. However, the government and citizens of Taiwan strongly oppose this prospect and are strengthening their military defenses with the aid of weapon supplies from the United States.
Li urged “both sides of the Taiwan Strait” to collaborate in promoting Chinese culture and advancing China’s rejuvenation, while also restating Beijing’s determination to take firm action against Taiwan’s independence and facilitate reunification.
According to Wen-ti Sung, a specialist in Chinese and Taiwanese affairs at the Australian National University, Li’s statements regarding Taiwan imply that Beijing is pursuing gradual improvement rather than swift outcomes in its policies toward Taiwan.
Sung noted that despite listing “oppose Taiwan independence” ahead of “promote reunification,” Li’s speech implies that China is taking a defensive stance toward Taiwan during Taiwan’s presidential campaign year. Additionally, Beijing is focused on maintaining stability as it addresses its domestic economic challenges.
While China’s military has been instructed to be ready for a potential conflict over Taiwan, analysts note that the projected timelines for preparedness, often mentioned as around 2027, refer solely to capability rather than intention.
The NPC declared a 2023 defence budget of 1.56tn yuan (US$226bn) on Sunday, representing a 7.2% increase from the previous year. China’s defence budget has been increasing steadily in recent years.
Shih stated that the rise was expected, given the military’s objective of modernization, and was nominal and coincided with a period of high inflation.
Over the weekend, the NPC and a political advisory group known as the Chinese People’s Political Consultative Conference held their yearly concurrent meetings, commonly known as the “two sessions.”
The gathering on Sunday was among the limited NPC meetings accessible to the public. Discussions on legislative and constitutional modifications will occur in private until the following weekend. The majority of resolutions have already been made during previous assemblies of top Party authorities, and the week is typically perceived as a mostly symbolic occasion.
This week, new officials will be named to government roles, such as premier, and there is widespread conjecture that substantial alterations to government departments will result in certain state entities being incorporated into party equivalents, further augmenting the authority of the Xi-led party over China and its governmental functions.
