China Market Intelligence

Last month, the 14th National People’s Congress Standing Committee (NPCSC), China’s top legislative body, released its five-year legislative plan for 2023 to 2028. The plan outlines a total of 130 legislative projects—the highest total since the NPCSC released its first five-year legislative plan in 1993, which had a total of 152 items.

Amid a slowdown in economic growth and reduced domestic consumption, China’s State Council released a 24-point guideline that emphasizes the importance of attracting and utilizing foreign investment to establish what is described as a “new open economic system.” The document, published last month, is essentially a guidebook for other Chinese policymaking bodies which are expected to implement the opinions.

US lawmakers recently returned to Washington after more than a month of working in their home districts and are gearing up for an eventful fall. Multiple must-pass pieces of legislation are looming on the horizon, and lawmakers will try to use these vehicles to legislate on China-related topics.

Traveling between the United States and China has become more common and convenient over the past eight months as both countries eliminated COVID-19 restrictions, relaxed visa policies, and allowed for more flights between the two countries.

US-China bilateral trade in goods saw a sharp contraction during the first half of 2023 after reaching a record high the year prior. The contraction in bilateral trade occurred amid a broader, albeit more modest, contraction in US-worldwide trade in goods, stemming from global and domestic economic woes that have led the WTO, IMF, and World Bank to forecast slower growth for global trade in 2023.

In 2020, the Chinese government sought to rein in real estate developers’ high debt levels with the introduction of the “three red lines,” which imposed borrowing limits on real estate firms. While the move was meant to stabilize the industry, developers and local governments alike have been under financial pressure as developers face declining property sales and local governments see decreasing revenue from land sales.

On August 20, it was reported China had formally established the Central Science and Technology Commission (CSTC) and that the commission hosted its inaugural meeting. The CSTC was created as part of the Party and Government Reform Plan, the principal deliverable at the National People’s Congress held in March.

On August 9, the Biden administration released its long-expected executive order (EO) on outbound investment, along with an Advance Notice of Proposed Rulemaking (ANPRM) from the Treasury Department. While the EO is narrower than other proposals seen in recent years, it still represents a significant change in US policy.

In recent months, China has seen significant high-level personnel changes at both central and provincial levels. On July 25, the National People’s Congress Standing Committee voted to remove Qin Gang from the post of foreign minister and reappoint his predecessor Wang Yi, current director of the CCP Central Foreign Affairs Office.