Coronavirus and the Delayed “Two Sessions” of China

Every year, the two biggest annual meetings of China takes place in March for two weeks, together they are called the “Two Sessions” or Lianghui. The two sessions include the plenary sessions of the National People’s Congress (NPC) and the Chinese People’s Political Consultative Conference (CPPCC). While the NPC is the top legislative body and the CPPCC is an advisory body on a range of issues. The first CPPCC meeting was held 70 years ago but it was only in 1978 that the two sessions were institutionalized.¹ As a convention, the Chinese Premier delivers a review of the report of the last year and sets the target for the development for the subsequent year to 3000 NPC delegates on the first day of the conference. In the report, he states China’s GDP growth goal for the year along with other key targets.²

This year’s “two sessions” were delayed by two months and shortened by one week because of the Coronavirus pandemic. It was the third session of the 13th NPC that was held from 21-27 May 2020. It is important to note the backdrop of this year’s congress; it was marked by the coronavirus pandemic, end of the 13^th five-year plan, the target year of doubling of the 2010 Gross Domestic Product (GDP) figures, and the first year of economic contraction since 1976.

Highlights of the Work Report Presented by Li Keqiang

The meeting began by paying homage to the people who lost their lives due to coronavirus. Premier Li Keqiang presented the work report under eight sub-headings; he started by reviewing the performance of the country in 2019. The GDP reached 99.1 trillion Yuan –an increase of 6.1 per cent increase over the previous year.

Economic Issues

On the economic side, the government did not set any GDP targets for the country this year as compared to last year, where the GDP target was 6-6.5 per cent. It was the fourth time in the history of China that the GDP target was not set. Earlier, in 2000, 2001 and 2002 China had not set its GDP growth targets.³

Before the meeting, there was a lot of churning within the party whether to include a “number” or not. By not setting a GDP target, Li Keqiang said: “This is because our country will face some factors that are difficult to predict in its development due to the great uncertainty regarding the COVID-19 pandemic and the world economic and trade environment. Not setting a specific target for economic growth will enable all of us to concentrate on ensuring progress on the six fronts and security in the six areas.”⁴

The six fronts are employment, finances, foreign trade, foreign investment, domestic investment and people’s expectations. The six areas include job security, basic living needs, operations of market entities, food and energy security, stable industrial supply chains and the normal functioning of the primary-level governments.⁵

Although a GDP target was not mentioned in the report, China set other targets such as employment and CPI. For employment generation, China set the goal of creating 9 million new urban jobs as compared to 11 million last year, CPI increase of around 3.5 per cent as against 3 last year, equilibrium in the balance of payment, elimination of poverty among the rural residents living below the poverty line, growth in personal income, prevention and control of major financial risks, a further drop in energy consumption per unit of GDP and the discharge of major pollutants and accomplishment of the 13th Five-Year Plan.

A “proactive fiscal policy” was also announced, the deficit to GDP ratio is anticipated to be at more than 3.6 per cent, with a deficit increase of one trillion Yuan than the last year. To ensure social stability, the report indicated that China expects to eliminate poverty by the end of this year, prevent a resurgence of epidemics such as COVID-19 and expansion of health capabilities and research. Also, the work report specified special schemes to deal with COVID-19 such as issuing of 1 trillion Yuan of government bonds and a special package of policies to support the development of Hubei Province.⁶ The COVID package is closely linked with the larger Chinese economy.

Defence and Foreign Policy

Li Keqiang announced an increase in the defence budget by 6.6 per cent (USD 179 billion). It is the lowest defence budget growth rate announced by China in recent years.⁷ Nevertheless, it is the second-largest defence allocation in the world after that of the United States. The increase exemplifies China’s security threat concerns and its commitment of completing the modernization of the PLA by 2035 and a world-class military by 2049. In one of the article published by Xinhua, Xi Jinping instructed the military “to think about worst-case scenarios, scale up training and battle preparedness, promptly and effectively deal with all sorts of complex situations and resolutely safeguard national sovereignty, security and development interest.”⁸

The report underlined that China will shorten its negative list for foreign investment, joint implementation of the US-China phase-one economic and trade agreement where China pledged to buy, over two years, at least USD 200 billion more in American goods and services, safeguarding the multilateral trading regime and active participation in the World Trade Organization, stabilising foreign trade and leveraging the role of foreign capital and establishing new pilot free trade zone and integrated bonded areas in the countries central and western region. The report also mentioned commitment to Regional Comprehensive Economic Partnership (RCEP) and free trade negotiations with Japan and South Korea.

A separate section was dedicated to Hong Kong and Taiwan. On Hong Kong, a “New Security Bill” was adopted. The report stated that China will establish a legal systems and enforcement mechanisms in the Special Administrative Region (SAR). There was no mention of Hong Kong’s basic law (“mini-constitution”). On Taiwan, the report mentioned that China will pursue “reunification” here again the term “peaceful” and the “1992 consensus” was omitted from the report.⁹

New Security Law and the NPC

The NPC voted 2878 to 1 in favour of the “New Security Bill” with some changes. The bill is intended to prevent, stop and punish acts in Hong Kong that threaten national security, and encompasses secessionist and subversive activity as well as foreign interference and terrorism. It highlighted the responsibility of Hong Kong’s leader to protect national security by launching promotional and education programmes on the matter, prohibiting acts that threaten national security, and submitting reports to the central government regularly.¹⁰

The spark for the new law can be traced back to an article published in December 2019 by a senior official dealing with Hong Kong and Macao that pointed “Hong Kong has neither passed the national security law nor established any institute for enforcement”. On the contrary, Macao has already passed the law and improved their condition. According to the official absence of a national security law has led to intensification of the protests there was a need of “national security law” for Hong Kong.¹¹

At the NPC, the new law was issued on the pretext of countering protests in Hong Kong that started in April 2019, against the extradition treaty and later spread as a wider movement. Wang Yi, said, “the protests that roiled Hong Kong for much of last year had posed a grave threat to national security, demonstrating that such legislation was long overdue.” Further, justifying China’s position, Xinhua published a commentary opining that the law is necessary to stop the “extremist” protesters trying to overthrow the government. “The national security legislation for the Hong Kong Special Administrative Region (HKSAR) is purely a matter of China’s internal affairs and no foreign country has the right to interfere.”¹²

The law will shatter the Hong Kong’s “the high degree of autonomy” that was promised in 1997. The announcement has undermined the independence of the judiciary and its rule of law and allowed the security agencies from the mainland to operate in Hong Kong.¹³ The US has strongly opposed the bill, the US Secretary of State Mike Pompeo said, “No reasonable person can assert today that Hong Kong maintains a high degree of autonomy from China, given facts on the ground.”¹⁴ Responding to Pompeo’s statement, Global Times, published an article stating that “a China-US “battle “over Hong Kong has started”.¹⁵

Assessment

Unlike previous years, not many details were given on the Chinese Foreign Policy. There were little details on the US-China trade dispute. The US-China trade dispute has trickled over to the US-China technological and strategic aspects of the bilateral relationship. The US was mentioned only one time regarding the joint implementation of the phase-one deal.

On the contrary, in 2017, the Chinese Premier had given a detailed account of US-China ties. This was the time when Xi Jinping was going to meet Donald Trump for the first time.¹⁶ Little mention of the bilateral relations signifies that China wants to keep its options open and does not want to deteriorate its relations with the US.

The details of the development and concerns about the Belt and Road Initiative (signature project of Xi Jinping) were not highlighted in the report. Some African countries, Pakistan, Sri Lanka are facing problems with the Chinese loans and have requested for the restructuring of loans. G20 Finance Ministers had decided to suspend the debt payments for the poor countries as part of an “action plan” to tackle the coronavirus. Since China is part of the G20, it will have to follow and restructure the debt. However, there was no such mention of restructuring the debt of these countries. As the entire world is in the grip of the COVID-19 led lockdown, none of the projects are moving.¹⁷

The work report was a sort of reassurance from the Party members that everything will be normal soon. China’s target of achieving a moderately prosperous society was mentioned 6 times in the work report and the poverty alleviation highlighted 17 times. By not putting any numbers for the GDP, gives the Chinese government an opportunity to hide its failure and hype its success. It also had a subtle message for the people of China that they should prepare for tougher times.¹⁸

Conclusion

To sum up, this year’s two-sessions had a few foreign journalists to cover the proceedings. The top priority of this year’s “two sessions” centered on COVID-19 pandemic containment and economic stimulus measures. Hong Kong is very crucial for China as it is the conduit for China’s in and out investments as also to achieve the great rejuvenation. At the time, when the world is jostling with the coronavirus pandemic, China has introduced the national security legislation for HKASR, it shows China’s disregard for the international community. The agitation that followed the introduction of the bill, further, gives Xi Jinping a more valid reason to suppress the dissent and another justification for the Chinese to carry out an information campaign to highlight the US role in Hong Kong. Seemingly, the modus operandi of China at this point of time appears to be to divert attention from the internal developments within China.

The next few years are very crucial for China. In 2021, China will celebrate the centenary of the founding of the Communist Party of China (CPC). Subsequently, the next Chinese communist Party’s 20th Congress will take place in 2022. Thus the NPC tried to project Chinese resilience but the fact remains that China is under pressure from all quarters.

Endnotes

1. https://news.cgtn.com/news/334d444d776b7a6333566d54/share_p.html [3]
2. https://www.caixinglobal.com/2019-03-01/five-things-to-know-about-chinas-two-sessions-101386176.html [4]
3. http://www.chinadaily.com.cn/a/202005/24/WS5eca16c7a310a8b241157f21.html [5]
4. http://www.gov.cn/premier/2020-05/22/content_5513757.htm [6]
5. http://www.xinhuanet.com/english/2020-05/22/c_139078608.htm [7]
6. http://www.chinadaily.com.cn/a/202005/22/WS5ec726fba310a8b2411577ee_6.html [8]
7. https://chinapower.csis.org/military-spending/ [9]
8. http://www.xinhuanet.com/english/2020-05/26/c_139089760.htm [10]
9. https://in.reuters.com/article/china-parliament-taiwan/china-drops-word-peaceful-in-latest-push-for-taiwan-reunification-idINKBN22Y06Y [11]
10. https://www.scmp.com/news/hong-kong/politics/article/3085738/what-does-beijings-new-national-security-law-hong-kong [12]
11. http://en.people.cn/n3/2019/1212/c90000-9639888.html [13]
12. http://www.xinhuanet.com/english/2020-05/22/c_139079797.htm [14]
13. https://www.theguardian.com/commentisfree/2020/may/22/china-foisting-anti-sedition-law-hong-kong-freedoms [15]
14. https://www.scmp.com/news/china/politics/article/3086406/hong-kong-no-longer-enjoying-promised-autonomy-china-pompeo [16]
15. https://www.globaltimes.cn/content/1189857.shtml [17]
16. https://www.scmp.com/news/china/diplomacy/article/3085728/two-sessions-2020-why-chinese-premier-li-keqiang-had-little [18]
17. https://www.scmp.com/news/china/politics/article/3085552/two-sessions-2020-live-national-peoples-congress-gets-under-way [19]
18. https://supchina.com/2020/05/26/china-abandons-gdp-growth-target-2/ [20]

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