China's Ambitious Blueprint for Economic Modernization Unveiled

Chinese leaders committed to modernizing the industrial sector, increasing domestic demand, addressing debt and property sector risks, and implementing financial reforms at a key Communist Party meeting. The meeting underscored the importance of market mechanisms and planned to complete the 'tasks' by 2029, focusing on new productive forces and quality growth.

Chinese leaders pledged on Thursday to modernize the country's industrial complex, expand domestic demand, curb debt and property sector risks, and implement financial and fiscal reforms, state media reported following a key Communist Party meeting.

Xinhua news agency's readout from the meeting, held approximately every five years, also stated Beijing aims to enhance social security, healthcare, income distribution systems, and introduce land reforms. The report emphasized the role of market mechanisms in creating a fairer, more dynamic market environment and optimizing resource allocation efficiency.

Previous documents stated markets would play a 'decisive role' in the economy. The latest report noted restrictions would be lifted, while effective regulation ensures market order and remedies failures.

The readout did not detail specific changes but stated tasks should be completed by 2029. A more detailed policy document from the four-day, closed-door meeting led by President Xi Jinping is expected soon.

State media previewed the event as 'epoch-making.' The plenum occurred amid financial hardship for more Chinese citizens and increased adversity against China's industrial policies abroad. The communique reiterated China's pursuit of 'new productive forces,' scientific research, and technological breakthroughs to modernize manufacturing and spur high growth.

'We will improve the institutions and mechanisms for fostering new quality productive forces in line with local conditions,' the report said. China's economy grew slower than expected in the second quarter, relying heavily on industrial output and external demand, while the property sector and household consumption lagged.

A decade ago, China pledged to resolve the imbalance between high investment/output and tepid demand at a similar plenum. Instead of focusing on consumers, it invested in infrastructure and real estate, leading to unsustainable debt levels. Thursday's communique reiterated the goal to 'actively expand domestic demand.'

(With inputs from agencies.)