Zhong Caiwen: Build the "Greatest Consensus," Grasp the Five "Must-Coordinates," and Work with Enterprise to Excel in Economic Work
Theory originates from practice, yet transcends and guides it. Since the 18th CPC National Congress, the Party Central Committee with Comrade Xi Jinping at its core has continuously summarized and distilled the practical experiences of economic development in the New Era, sustained the deepening of our regular understanding of economic work, and formulated a series of important propositions, thereby forming Xi Jinping Economic Thought. At the Central Economic Work Conference held at the end of last year, General Secretary Xi Jinping summarized and proposed the important understanding of "One Maximum Consensus and Five Must-Coordinates." This further enriched and developed Xi Jinping Economic Thought, providing ideological guidance for economic work in the coming period.
Upholding the centralized and unified leadership of the Party Central Committee is the fundamental guarantee for successful economic work. At critical moments and important junctures, the Party Central Committee has promptly assessed the situation and made strategic deployments, ensuring that the ship of China's economy braves the wind and waves to achieve steady and sustained progress. This is the maximum consensus formed by the entire Party and society, and an inevitable conclusion drawn from years of practical experience. To promote high-quality development, we must coordinate the relationships between: an effective market and a proactive government; aggregate supply and aggregate demand; the cultivation of new driving forces and the updating of old ones; the optimization of incremental growth and the revitalization of existing stock; and the improvement of quality and the expansion of total volume. These are the inevitable requirements placed upon economic work by the conditions and developmental tasks of the new era, representing the rich development of Xi Jinping Economic Thought. We must arm our minds with the Party's innovative theories to guide practice, taking proactive action in economic work to provide a solid economic foundation for realizing Chinese-path modernization.
I. We must coordinate the relationship between an effective market and a proactive government to form an economic order that is both "dynamic" and "under control."
General Secretary Xi Jinping pointed out: "Developing a socialist market economy is a great creation of our Party; the key lies in properly handling the relationship between the government and the market." Handling this relationship is the core issue of economic structural reform. The combination of an effective market and a proactive government is a key factor in the success of China's socialist market economy. Historical experience since the reform and opening up demonstrates that the socialist market economy can leverage the strengths of a market economy—allowing the market to play the decisive role in resource allocation—while also highlighting the superiority of the socialist system by allowing the government to better play its role. This has provided the institutional support for China to create the "Two Miracles" [1] of rapid economic growth and long-term social stability. As China's economy shifts from a stage of high-speed growth to high-quality development, new and higher requirements are placed on coordinating an effective market and a proactive government.
We must better play the role of the government and resolve the issues of absence and overstepping. General Secretary Xi Jinping noted: "Scientific macro-control and effective government governance are inherent requirements for leveraging the advantages of the socialist market economy system." Better playing the government's role does not mean the government should do more; rather, it means adhering to the principle of doing some things while refraining from others, grasping the boundary between action and inaction, and ensuring the government performs its duties well and correctly. "Doing some things" means continuously building a de jure economy and a credit-based economy, improving market rules and taking the lead in following them, focusing on correcting market failures, regulating the order of competition, and constructing a national unified large market. This creates a fair competitive arena for all types of business entities, including state-owned enterprises, private enterprises, foreign-funded enterprises, and individual industrial and commercial households. The government should play an important role in planning guidance, industrial layout, and innovation leading, thereby promoting technological innovation and industrial transformation. We must improve the subterranean system of macroeconomic governance, strengthen macro-control, smooth out economic cycles, prevent sharp fluctuations in economic operation, and promote long-term, sustained, and healthy economic development. We must strengthen quality supervision and standards construction, using rules and standards to drive improvements in the quality of products and services.
"Refraining from others" means preventing improper intervention in the activities of micro-entities, avoiding local protectionism and self-contained "small circulations" [2], and shunning profit-driven law enforcement, arbitrary fines, inspections, or seizures. The more standardized government behavior becomes, the more effective the market's role will be. We must bring government behavior fully into the orbit of the rule of law, comprehensively build a law-based government, improve mechanisms for government creditworthiness and the fulfillment of promises, increase the intensity of property rights protection, and standardize law enforcement involving enterprises. This will lower the institutional costs of market operation, allowing market mechanisms and the rule of law to be organically combined and mutually reinforcing.
We must fully leverage market mechanisms to create a fairer and more vibrant market environment. We must accelerate the construction of a high-standard market system that is unified, open, competitively orderly, institutionally sound, and well-governed. We must improve basic market systems such as property rights protection, market access, fair competition, and social credit to achieve equal access, impartial supervision, open order, and integrity under the law. We must accelerate the construction of a national unified large market that is efficient, standardized, fair in competition, and fully open. This involves promoting the unification of basic market systems and rules, the fairness and unification of market supervision, and the high-standard interconnection of market facilities, thereby promoting the smooth flow of commodities and factor resources over a wider range. Through more refined market mechanisms, we must promote the "survival of the fittest," gather innovative elements, and allow the vitality of various factors—labor, capital, knowledge, technology, management, and data—to burst forth. We must allow all sources of social wealth to flow fully, creating a developmental situation where people's talents are fully utilized, materials are put to their best use, land is used to its full potential, and goods flow smoothly.
Coordinate the relationship between an effective market and a proactive government, allowing the "invisible hand" and the "visible hand" to work in synergy. Both the government and the market are means of resource allocation. An effective market and a proactive government are interdependent and mutually supportive; they must be efficiently combined and coordinated to achieve optimal resource allocation. General Secretary Xi Jinping emphasized: "One cannot use the market's decisive role in resource allocation to replace or even negate the government's role, nor can one use the government better playing its role to replace or even negate the market's decisive role." Coordinating this relationship requires strengthening the systems concept, preventing mismatched or absent roles, and forming a synergy for the government and market to efficiently allocate resources. In the relationship between the government and the market, the government is the subject and the market is the object. The government's role is proactive, while the market's role is spontaneous. The key lies in standardizing government behavior and transforming government functions. Only when the government plays its role better in its own sphere of responsibility can the market play its decisive role in resource allocation. We must adhere to the direction of socialist market economy reform, accelerate the construction of a high-level socialist market economy system, and transform the institutional advantages of the socialist market economy into governance efficacy, providing lasting momentum for promoting high-quality development and advancing Chinese-path modernization.
II. We must coordinate the relationship between aggregate supply and aggregate demand to ensure the smooth circulation of the national economy.
Supply and demand are the two fundamental aspects of the inherent relations within a market economy; they represent a dialectical relationship that is both oppositional and unified. One cannot exist without the other; they are interdependent and mutually conditional. Without demand, supply cannot be realized, and new demand can stimulate new supply. Without supply, demand cannot be met, and new supply can create new demand. The dynamic balance of aggregate supply and demand is the basic condition for steady and healthy economic development and the fundamental goal of macroeconomic control. If the two are imbalanced, the circulation of the national economy will be blocked, potentially triggering violent economic fluctuations. Historically, most economic and financial crises in Western countries have manifested as severe imbalances between aggregate supply and demand. The balance between the two is a relative and dynamic process; achieving it requires concerted efforts from both sides.
We must continue to deepen supply-side structural reform. In recent years, the Party Central Committee has decided upon and implemented supply-side structural reform, which has significantly improved the quality and efficiency of China's supply system and the quality of economic development. Under new development environments and conditions, deepening this reform entails many new requirements. In terms of quality, we must persist in innovation-driven development led by technology, accelerating the development of emerging industries and promoting the transformation and upgrading of traditional industries. In terms of quantity, we must adhere to the principles of "moving forward and pulling back, protecting some and pressing others, increasing some and decreasing others." For certain industries, we must comprehensively rectify "involuted" [3] competition, maintain reasonable capacity utilization rates, and form a healthy, sustainable industrial development ecosystem. We must push enterprises to improve supply quality, promote "high quality for high price," encourage "upward competition," and provide more high-quality products and services. This will enhance the suitability and balance of supply relative to demand, striving to create and stimulate new demand through new supply.
We must persist in taking the expansion of domestic demand as a long-term strategic move. Influenced by various international and domestic factors, China faces insufficient domestic demand and unstable external demand. The imbalance between aggregate supply and demand has become the greatest constraint on the smooth circulation of the national economy. China's domestic demand potential is vast but has yet to be fully released. Due to geopolitical conflicts and intensified global protectionism, the world economic recovery is lackluster, and the instability and uncertainty of external demand have risen significantly. In this context, expanding domestic demand is a strategic move concerning long-term economic stability and development, not a temporary expedient for short-term fluctuations. Particularly as an ultra-large economy, we must base the foundation of steady and healthy economic development on the strong support of domestic demand. We must adopt powerful and effective macroeconomic policies to quickly bridge the gap in domestic demand—especially consumption—making it the main driver and "stabilizing anchor" for economic growth. We must establish and improve long-term mechanisms for expanding resident consumption, particularly expanding demand supported by income, so that residents can consume with stable income, wish to consume with good experiences, and dare to consume without worries. We must improve the mechanism for expanding investment, innovate and optimize investment and financing mechanisms, and expand investment demand with reasonable returns. We must coordinate investment in "physical things" with investment in "people," and coordinate the increase of government investment with the stimulation of social investment. This ensures that effective investment can both promote current demand and be transformed into future advanced productive forces and new quality productive forces.
We must promote the realization of a dynamic balance between aggregate supply and aggregate demand. Supply and demand are two sides of economic operation; they are mutually conditional, interdependent, and dialectically unified throughout the entire process. In reality, the balance of aggregate supply and demand is relative and temporary; there is no absolute or once-and-for-all balance. However, a dynamic overall balance can be achieved through continuous mutual adaptation. The dynamic process from balance to imbalance and then to a new balance is an objective law of economic development. The 20th CPC National Congress explicitly proposed "organically combining the implementation of the strategy to expand domestic demand with the deepening of supply-side structural reform." We must plan the expansion of domestic demand and the optimization of supply in a coordinated way, clearing the bottlenecks and "choke points" of economic circulation. This will promote a positive interaction between supply and demand, fully leverage the advantages of our ultra-large-scale market and ultra-strong supply capacity, and achieve a higher level of dynamic balance to smooth the domestic cycle. Simultaneously, we must stabilize the fundamentals of foreign trade and foreign investment, steadily open up diverse international markets, and both expand exports and increase imports. We must smooth and improve the international cycle, maintaining a basic balance in the current account and overall balance of payments to promote internal and external economic equilibrium. On the basis of smoothing the domestic circulation and stabilizing the international circulation, we will effectively build a New Development Paradigm with the domestic cycle as the mainstay and the domestic and international dual circulations reinforcing each other.
III. We must coordinate the relationship between nurturing new driving forces and updating old ones, developing new quality productive forces according to local conditions.
The concept and connotation of new quality productive forces, as well as their role and significance in high-quality development, must be viewed dialectically and understood accurately. Economic development requires a continuous stream of momentum, which includes both the vigorous development of emerging industries to nurture new driving forces and the transformation and upgrading of traditional industries to optimize and update old ones. These are both unified in the process of developing new quality productive forces according to local conditions; the coordination and linkage between the two must be strengthened. New quality productive forces emphasize the "quality state" (质态) of advanced productive forces rather than the "business format" (业态) of a specific emerging or traditional industry. New driving forces are not simply equivalent to emerging industries; traditional industries can also give birth to new driving forces. Looking at the laws of technological revolution and industrial development, the previous generation of industrial revolution is the foundation for the next, and traditional industries are the foundation for emerging ones. As the saying goes, "The new bamboo grows taller than the old, but it relies entirely on the support of the old stems" [4]. Without the foundation of traditional industries, emerging and future industries would be but "castles in the air." Regions in China where emerging industries are developing well generally have a vast and solid traditional industrial system as support, which is also an important foundation for developing new quality productive forces.
We must continuously shape new driving forces and new advantages for economic development. General Secretary Xi Jinping emphasized...
"New quality productive forces are advanced productive forces in a state where innovation plays the leading role," and are "primarily birthed by revolutionary breakthroughs in technology." The historical process of human industrialization and modernization is, in essence, a process of the diffusion and application of advanced technologies. Currently, a new round of technological revolution and industrial transformation is in the ascendant. The trends of collective breakthroughs in multiple disciplines, cross-disciplinary integration of new technologies, and broad application across numerous industries are becoming more pronounced. These trends are nurturing a batch of emerging and future industries, which are becoming new focal points and domains of international competition. We must treat major scientific and technological innovation as the fundamental reliance for developing new quality productive forces and cultivating new drivers of growth. We must strengthen basic research and breakthroughs in key core technologies, reinforce the construction of national strategic technological strength, and carry out large-scale application demonstration actions for new technologies and products. We must strive to create batch after batch of new industrial engines with high technological content, strong market competitiveness, and significant catalytic effects, forging "new long poles" [5] for the Chinese economy.
We must continuously promote traditional industries to radiate new vigor and vitality. In developing new quality productive forces, traditional industries cannot be simply discarded; there must be no fault lines in the economic structure, and we must prevent the economy from "shifting from the substantial to the virtual" [6] or becoming "bubble-based." Through years of development, China’s traditional industries have attained a leading global position in terms of scale, structural systems, technological levels, and international competitiveness. They constitute the important material and technological foundation and the decisive factor for our economic strength, comprehensive national power, and the people's standard of living. As the bedrock of a modernized industrial system, traditional industries are the basic reliance for economic growth, employment, and income. In developing new quality productive forces, we must absolutely not treat traditional industries as "low-end" or "backward" and simply exit them. We must actively utilize digital and green technologies to transform and upgrade traditional industries, and intensify the expansion of large-scale equipment renewals and trade-ins of consumer goods. Through various paths such as digital empowerment, process upgrades, and management innovation, we should promote the transformation of traditional industries toward high-end, intelligent, green, and integrated directions, constantly enhancing their vitality and competitiveness through continuous iterative updates.
We must profoundly grasp the dialectical relationship between cultivating new drivers of growth and renewing old ones. There is a need to promote a smooth and continuous transition between new and old development drivers. From international experience, the "hollowing out" of traditional industries often restricts technological and industrial innovation capabilities and weakens economic competitiveness. Resources and industrial development levels vary greatly across different regions of China. In developing new quality productive forces, we cannot blindly follow trends for a single industry or simply apply a single model; we must avoid "rushing headlong into action" [7]. We must fully consider the actual conditions of each region, leverage unique advantages, find the optimal path, and form models for cultivating new quality productive forces with local characteristics. In particular, we must seize the renewal of the "state" of productivity and highlight "new quality" as the key, developing new quality productive forces according to local conditions. The "Three Norths" region [8] has explored and formed good experiences and practices in "photovoltaic desertification control," turning deserts into resources. All regions across the country can combine their own realities to bear the fruits of new quality productive forces in the process of coordinating the cultivation of new drivers and the renewal of old ones.
IV. We must coordinate the relationship between optimizing increments and revitalizing stock to comprehensively improve the efficiency of resource allocation
Economic development is both a process of increasing national income and a process of accumulating social wealth and expanding assets and liabilities. The former represents increments and flows, while the latter represents stock; these two aspects are closely related and interact with each other. China's economy has shifted from a stage of high-speed growth to a stage of high-quality development, and the two-way interaction between stock and increments has significantly strengthened. Macroeconomic governance must broaden its horizon, coordinate the relationship between optimizing increments and revitalizing stock, achieve the optimal allocation of all social resources, and promote high-quality development.
We must fully recognize the importance of revitalizing stock resources. Through more than 40 years of rapid development since the reform and opening up, China has accumulated a massive scale of various assets. Whether in terms of value or physical volume, the "stock economy" has reached the proportions of a "giant." There is an urgent need to strengthen asset and liability management, coordinate the use of various incremental and stock resources, and comprehensively improve resource allocation efficiency. The CPC Central Committee’s proposals to increase residents' property income and develop markets for second-hand housing and used cars are both strategies to optimize increments by revitalizing stock. From the practice of many localities, regions that are adept at revitalizing stock resources, assets, and capital see more obvious results in promoting development. Optimizing increments and revitalizing stock complement and promote each other: optimizing increments provides conditions and opportunities for revitalizing stock, while revitalizing stock provides space and resources for optimizing increments. By organically combining the two, we can better tap into development potential and expand the space for growth.
We must revitalize stock to drive increments with a broad vision. Revitalizing stock and expanding capacity should rely more on reform methods and technological means. China's stock resources are extremely rich, and the potential for revitalizing them is immense. In particular, many idle or inefficiently utilized resources can be "turned from waste into treasure" or "transformed from the mundane into the miraculous" [9]. We must effectively revitalize basic assets such as land, promote the "vacating the cage for new birds" [10] and "renewed development" of industrial parks, revitalize various types of inefficient urban land, optimize the spatial structure of production and life, and increase public service facilities. We must advance urban renewal with high quality, implement the renovation of "villages-in-the-city," and promote the renovation and utilization of old blocks, old residential areas, and old buildings. We must make full and good use of local government special bonds, central bank re-lending, and other funds to acquire stock commercial housing at reasonable prices for use as affordable housing, effectively meeting the housing needs of new urban residents and young people. We must develop a circular economy, strengthen the recycling of waste resources, and vigorously develop "urban mines." We must standardize the development of used car and second-hand housing markets to form a market system where new and old cars, and new and old houses, develop in coordination. Through methods such as leasing, equity participation, and cooperation, we should revitalize and utilize idle housing legally owned by farmers. For idle rural infrastructure such as primary and secondary school buildings, we can reasonably convert their use through standardized methods. These all indicate that revitalizing stock holds great potential.
The Third Plenary Session of the 20th CPC Central Committee pointed out: "Explore the implementation of national macroeconomic balance sheet management." This is a major innovation in improving the macroeconomic governance system. We must deeply study the relationship between macroeconomic asset and liability conditions and economic growth, innovate macroeconomic policy tools, and enhance the nation's capacity for macroeconomic asset and liability management. At the national level, we should compile macroeconomic balance sheets for residents, enterprises, and the government to accurately depict the asset and liability status of the whole country, localities, and various fields. We must "get a clear picture of the bottom line" and master the "family assets" (the nation's wealth). Based on this, we can comprehensively analyze economic growth potential, research and judge hidden economic and financial risks, assess debt-repayment capabilities, and formulate policy measures to optimize the scale and structure of macroeconomic assets and liabilities, thereby increasing the systematicity, precision, and effectiveness of macroeconomic governance.
Coordinating the optimization of increments and the revitalization of stock requires adhering to upholding the fundamentals and breaking new ground. This coordination is a new topic arising after China's economic development reached a certain stage; it requires solving many new problems never encountered before. There is much that can be done and great potential to be tapped. We must persist in upholding the fundamentals and breaking new ground. On the premise of holding the line on institutional boundaries and legal "red lines," we must emancipate our minds, break through fixed patterns of thinking, be adept at observing the economy and solving problems from the perspective of combining increments and stock, and explore boldly in theory and practice. We must use reform and innovation methods to enrich the "toolbox" of revitalization policies, strengthen resource coordination, and mobilize the enthusiasm of market entities for revitalization. We must emphasize the "leveraging" role of fiscal policy tools—using a "small weight to move a large one" [11]—and the unique role of financial tools in "trading time for space" to achieve the optimal allocation of resources across time and space.
V. We must coordinate the relationship between improving quality and expanding the total volume to consolidate the material foundation for Chinese-path modernization
Economic development is a process of unity between "qualitative change" and "quantitative change." Qualitative change is the internal goal and direction of quantitative change, while quantitative change is the realistic basis for qualitative change. High-quality development encompasses both "quality" and "quantity." In economic work, we must profoundly grasp the dialectical relationship between the two and unify the effective improvement of quality with the reasonable growth of quantity throughout the entire process of high-quality development.
We must profoundly recognize that promoting high-quality development is the primary task of Chinese-path modernization. The 20th National Congress of the CPC proposed: "From this day forward, the central task of the Communist Party of China will be to lead the Chinese people of all ethnic groups in a concerted effort to realize the Second Centenary Goal of building China into a great modern socialist country in all respects and to advance the rejuvenation of the Chinese nation on all fronts through Chinese-path modernization." It further stated: "High-quality development is the primary task in building a modern socialist country in all respects." According to the "two-step" strategic arrangement determined by the 20th National Congress, by 2035, China will basically achieve socialist modernization: economic, scientific, and technological strength and comprehensive national power will rise significantly; and per capita GDP will reach a new level, reaching the level of a moderately developed country. Building on this, we will continue to strive so that by the middle of this century, China becomes a great modern socialist country leading in comprehensive national power and international influence. Chinese-path modernization is the modernization of a huge population. For our population of over 1.4 billion to enter a modernized society as a whole involves unprecedented arduousness and complexity. We must always proceed from national conditions and continuously promote high-quality development. Currently, China’s per capita national income is still lower than the world average and has not yet crossed the threshold of high-income countries. To achieve Chinese-path modernization, the road ahead is still very long and the tasks of development remain heavy. We must treat the promotion of high-quality development as the "hard truth" [12] of the New Era, and continuously consolidate the material foundation for Chinese-path modernization.
We must persist in leading and expanding the economic total volume by improving economic quality. Improvements in quality can open up new horizons and spaces for quantitative growth. Every technological and industrial revolution has brought new investment and consumption opportunities due to the qualitative improvement of productive forces, allowing the economy to break through the equilibrium formed under previous technological conditions and generate leapfrog growth in quantity. In the era of an economy of shortage, to solve quantitative contradictions as quickly as possible, the development mode was relatively extensive—"like fast-selling radishes, they weren't washed of their mud" [13]. Entering the stage of high-quality development, winning through quality has become the only way. At both micro and macro levels, without the effective improvement of quality, there can be no reasonable growth in quantity. Even if there is rapid growth in the short term, it will be difficult to sustain. To this end, we must fully, accurately, and comprehensively implement the New Development Philosophy; persist in innovative, coordinated, green, open, and shared development; work hard to implement the innovation-driven development strategy; focus on enhancing the integrity and coordination of development; promote the harmonious coexistence of man and nature; form a new system for opening up; and practice the people-centered development philosophy. We must coordinate development and security to promote the realization of higher quality, more efficient, more equitable, more sustainable, and more secure development. Enterprises and industries must also enhance their innovation capabilities, increase investment in new technologies, actively carry out digital-intelligent and green transformations of traditional industries, and rely more on improving product and service quality to enhance market competitiveness and expand market share.
We must provide fertile soil and space for improving quality by expanding the economic total volume. Only a sufficient accumulation of quantitative change can trigger qualitative change. Therefore, the scale of the total volume itself has unique value for improving quality. In many cases, "bigness" is itself a form of "strength," a fact repeatedly verified in the marketplace. Developing emerging industries and new quality productive forces can leverage the effects of economies of scale and economies of scope. The demand-pull of an ultra-large-scale market, combined with rich application scenarios, a complete industrial system, and diversified business organization models, can create more industrial applications, accelerate technological iteration, and nurture more world-class enterprises and advanced technologies. The development of fields such as high-speed rail, nuclear power, mobile communications, the platform economy, artificial intelligence, drones, new energy vehicles, and the low-altitude economy all follow this law. We must further leverage the advantages of a major-country economy, effectively transforming our advantages—such as a massive population and talent pool, vast territory, diverse resources, and high savings rates—into economic scale. We must form an economic scale that matches the modernization of a massive population, constantly catalyzing qualitative change on the basis of quantitative change, and continuously enhancing economic strength, technological strength, and comprehensive national power to consolidate the material and technological foundation of Chinese-path modernization.