Understanding the Chinese Economy Through Five "New" Dimensions: A Dialogue with Liu Wei, Former President of Renmin University of China
Observing the Chinese economy requires looking not only at the "form" [1] of development but, more importantly, grasping the "trend" and the "logic" that determine its direction. At present, behind complex macroeconomic data, we see the realistic contradiction of "strong supply and weak demand" on one hand, and the accumulation of deep-seated drivers for transitioning toward a new economic development model on the other. Looking ahead to 2026, what exactly will be the trajectory of the Chinese economy? How should macroeconomic policy strike a balance between stabilizing the present and planning for the long term? To answer these questions, this session of "Dialogue with Economists" invites Liu Wei, former President of Renmin University of China, to provide an in-depth interpretation through the dimensions of the new situation, new contradictions, new policies, new laws, and new models.
Analysis of the New Situation: Grasping Three Keywords
Reporter: Recently, China's economic data for 2025 has been released. Combined with the assessments from the 2025 Central Economic Work Conference, there is a general consensus across various sectors that the Chinese economy, while advancing under pressure, has demonstrated a trend of "the overall situation remaining stable and the structure trending toward optimization." How do you view this latest report card?
Liu Wei: This report card has indeed drawn widespread attention both at home and abroad. This is not only because of the sheer scale of the Chinese economy—with a total GDP accounting for approximately 18% of the global economy—but also because China, as a vital engine of global growth, has maintained a contribution rate to world economic growth of around 30% in recent years. The state of China’s macroeconomy and its policy direction affect the nerves of global markets. From the perspective of domestic development, 2025 is the closing year of the 14th Five-Year Plan. The data for this year concerns not only annual targets but also the realization of the entire Five-Year Plan and even the 2035 Long-Range Objectives; its importance is self-evident.
In my view, this report card clearly reflects three characteristics, which can be summarized as "stable overall, progressing while maintaining stability, and a positive outlook."
First, "stable overall." Economics generally uses four key indicators to judge the macroeconomic situation: economic growth, full employment, price stability, and balance of international payments. In 2025, China achieved the goal of "stability" in all four areas.
Economic growth met targets and showed resilience. The annual GDP growth rate was 5%, consistent with the target set at the beginning of the year. Quarterly, the growth rate followed a pattern of "higher at the start and easing later," but the annual target was successfully completed. From a global perspective, this growth rate remains strong, far exceeding the global average of approximately 3%. From a long-term strategic perspective, this rate is even more meaningful. Our goal for 2035 is for per capita GDP to reach the level of a moderately developed country. To achieve this, China's GDP must double between 2020 and 2035, which requires an average annual growth rate of approximately 4.73% over these 15 years. Within this, an average annual growth of over 5% is needed during the 14th Five-Year Plan period. The average growth rate from 2021 to 2024 was about 5.5%, which, combined with the 5% in 2025, means the economic growth targets of the 14th Five-Year Plan have been successfully reached, laying a solid foundation for medium-to-long-term development.
The total volume of employment remained stable. In 2025, the surveyed urban unemployment rate was controlled within the target range of 5.5%. Experience shows that for every 1 percentage point of economic growth, approximately 2.4 million new jobs are created. A 5% growth rate corresponds to roughly 12 million new jobs, effectively securing the basic employment situation. Currently, the main pressures in employment stem more from structural contradictions; attention must be paid to issues such as the mismatch between labor skills and job requirements caused by accelerated industrial transformation.
Prices were generally controllable, though signals of weak demand warrant vigilance. The annual Consumer Price Index (CPI) remained flat year-on-year and was stable overall, but this also reflects a continued insufficiency in total social demand. The Central Economic Work Conference particularly emphasized promoting a reasonable recovery in prices as an important consideration for monetary policy; in essence, this means focusing on expanding effective demand.
The balance of international payments remained robust. Against a complex and volatile global economic backdrop, China's total imports and exports grew by 3.8% in 2025, and foreign exchange reserves stabilized at above $3.2 trillion, providing solid support for responding to external risks.
Second, "progressing while maintaining stability." If "stable overall" focuses on the achievement of "quantity," then "progressing while maintaining stability" reflects the improvement of "quality"—that is, "moving toward the new and the optimal."
On one hand, efficiency on the supply side is improving, and new drivers are accelerating. The most prominent manifestation is the rapid formation of new quality productive forces, with various regions making layouts based on local conditions. The growth rates of high-tech manufacturing and equipment manufacturing are significantly higher than the average industrial growth rate. This reflects an increase in total factor productivity brought about by technological innovation, meaning the production function of economic growth is undergoing positive changes. On the other hand, the structure of the demand side is optimizing, and the growth drivers are becoming more balanced. There are two positive changes here: First, the synergy between internal and external demand has strengthened. In 2023, domestic demand was the absolute main force driving growth, while net exports made a negative contribution. By 2024 and 2025, exports had turned into a positive driver, forming a favorable situation where internal and external demand work together. Second, the fundamental role of consumption within domestic demand has strengthened. Consumption’s contribution to economic growth has stabilized at over 50%, and the policy orientation is more clearly directed toward boosting consumption, requiring the close integration of "investing in things" and "investing in people" [2]. The momentum is becoming more balanced and sustainable.
Third, "a positive outlook." The Central Economic Work Conference proposed consolidating and expanding the momentum of "stability and improvement" (稳中向好) in the economy. This phrasing implies that positive signals of the economic cycle are beginning to emerge. Looking at some monthly indicators from December 2025, signs of stopping the decline and stabilizing have indeed appeared. This judgment suggests that the intensity of macroeconomic policy in 2026 may be further strengthened, and the market can hold more optimistic expectations.
Reporter: While affirming achievements, the Central Committee also attaches great importance to risks and challenges. What do you believe are the primary pressures currently facing the Chinese economy? Are their roots cyclical or structural?
Liu Wei: Current challenges are complex and severe, primarily manifesting as "bidirectional pressure on both supply and demand, and the overlapping of domestic and international risks."
In the short term, the contradiction of insufficient demand, particularly domestic demand, is more prominent. The core of the contraction in demand lies in the fact that the two major engines—household consumption and corporate investment—are not yet strong enough. Regarding consumption, it is mainly reflected in a slowdown in growth. Consumption is a function of income, and the key factor is resident income. At the micro level, the growth rate of urban resident income is not that high, and the existing income distribution gap also suppresses the overall propensity to consume. At the macro level, in the pattern of primary national income distribution, the share held by the household sector is relatively low, restricting the release of consumption potential. Regarding investment, the key factor is the lack of confidence in private investment. The current problem may be more about "investment difficulty"—a lack of high-quality projects with stable expected returns, reflecting an insufficiently smooth transmission chain from technological innovation to market demand. Therefore, we must adhere to and implement the "two unswervinglys" [3] to effectively boost the confidence of private enterprises in long-term development.
The supply side is also under pressure, prominently reflected in bottlenecks facing industrial upgrading and technological innovation, as well as "bottleneck" [4] risks brought about by external technological blockades.
Furthermore, international environmental risks and domestic contradictions are overlapping. The global economic recovery is weak, and some countries are pursuing trade protectionism, engaging in so-called "decoupling and breaking chains" in an attempt to impact China's external demand and supply side and contain China's development momentum.
In such a complex situation, the "resilience" of the Chinese economy is particularly valuable. Whether it is the stability of the macroeconomic foundation, the continuous advancement of structural adjustment, or the sufficient policy space and significant institutional advantages, all indicate that our country possesses the capability and space to effectively coordinate resources and respond to major challenges. As long as we persist in the correct direction and take solid action, relying on this strong resilience and the long-term positive economic fundamentals, the Chinese economy will surely traverse the cycle and achieve high-quality development.
判断 of New Contradictions: Understanding the Internal Causes of "Strong Supply and Weak Demand"
Reporter: The Central Committee has judged the primary contradiction in current macroeconomic operations as "strong supply and weak demand." Many believe this is not a short-term characteristic but a structural issue following the transition of economic development stages. How do you understand this judgment?
Liu Wei: "Strong supply and weak demand" is a major judgment on the current state of macroeconomic operations. To understand this, we must return to the key task of macroeconomic regulation—maintaining a basic balance between total social supply and total social demand. General Secretary Xi Jinping once pointed out that, looking at the history of world economic development, whether economic policy focuses on the supply side or the demand side must be decided based on a country's macroeconomic situation.
Reviewing the practice since China's reform and opening up, the primary aspect of this contradiction has evolved through several stages, and our main line of macroeconomic policy has adjusted accordingly.
Before 1998, the main problem of the macroeconomy was that demand exceeded supply. At that time, policy objectives were clear: managing demand, moderate tightening, and suppressing inflation.
From 1998 to around 2012, it was more about dealing with surplus. Impacted successively by the Asian financial crisis and the international financial crisis, our country began to face overcapacity issues, initially in consumer goods and later spreading to the field of investment goods. Policy shifted to continuously expanding domestic demand, implementing proactive fiscal policies and other measures to address the challenge of insufficient demand.
After the 18th National Congress of the CPC, the primary aspect of the contradiction shifted to the supply side. Based on the judgment that the economy had entered a "new normal," the Central Committee pointed out that the crux of the problem lay in the supply-side structure failing to adapt to changes in demand. Therefore, supply-side structural reform was clearly identified as the main line, requiring efforts to improve the quality and efficiency of the supply system.
In recent years, demand-side contradictions have become prominent again. The Central Committee now emphasizes "coordinating the expansion of domestic demand with the deepening of supply-side structural reform," insisting on expanding domestic demand as a strategic baseline and clarifying it as a long-term strategy. The 2025 Central Economic Work Conference also placed the expansion of domestic demand in an important position. This means the focus of macroeconomic regulation is undergoing a new and profound change—from relying primarily on supply-side structural reform to having both the supply and demand sides exert force in tandem, using demand to lead supply and supply to create demand.
One could say that the judgment of "strong supply and weak demand" is by no means just a fine-tuning of policy intensity; it signals that the overall framework of macroeconomic regulation, the main line of policy, and the structure of policy tools will all undergo corresponding changes. The focus of future economic work will be more centered on how to effectively expand domestic demand and, on this basis, promote a dynamic balance of supply and demand at a higher level.
It must be noted that "strong supply and weak demand" is a relative and structural concept; it does not mean an absolute surplus of supply, and there must be a comprehensive understanding of this. The so-called "strong supply" is a manifestation of China being the world's largest manufacturing nation with a complete industrial system; this is the great achievement of decades of development and the solid foundation for future development. The so-called "weak demand" means that at the current stage, the scale and growth momentum of effective demand appear insufficient relative to the massive supply potential, forming a constraint on the economic cycle. Looking further, the gap between China and developed economies is still mainly reflected on the supply side, especially in technological innovation and industrial modernization. Meanwhile, the supply side itself also has structural contradictions: while some traditional industries indeed have overcapacity, high-quality supply in many fields is still insufficient. Numerous areas related to the quality of modern life, such as high-end manufacturing, high-quality education, healthcare, and elderly care, still struggle to meet the people's aspirations for a better life.
The key to resolving "strong supply and weak demand" lies in adhering to coordination. We must stimulate and expand demand through reform and policy, while also continuing to deepen supply-side structural reform. Relying on technological and institutional innovation, we should enhance the competitiveness and adaptability of the supply system, thereby achieving a virtuous interaction where new demand leads new supply and new supply creates new demand.
Reporter: How was this contradiction of "strong supply and weak demand" formed? What are its deep-seated causes?
Liu Wei: The causes are multifaceted and can be summarized into three points.
First are institutional causes, involving the interaction between market fragmentation and government intervention. Currently, administrative barriers and local protectionism still exist in the domestic market, which easily leads to duplicate construction and convergence of industrial structures—this is an important reason for the formation of structural overcapacity. Market development itself is a historical process; it still requires deepening reform and opening up and accelerating the construction of a national unified large market [5] to clear circulation bottlenecks and lay a solid foundation for releasing domestic demand. Simultaneously, if some local governments intervene excessively or violate market laws, it may exacerbate market fragmentation and the distortion of resource allocation.
Second are developmental causes; innovation capabilities are not yet sufficient to fully lead demand upgrading. The adaptability and leadership of the supply system in responding to changes in demand are not strong enough. The ability to transform new technologies, new models, and new business forms into effective supply and to create new demand needs to be improved; a high-efficiency cycle between new supply and new demand has not yet been formed.
Third are the impacts brought by changes in the international environment. Previously—
The development model characterized by “two ends outside, large-scale imports and exports” [6] is no longer sustainable, and external uncertainty has risen significantly. Our country has proposed the construction of a new development pattern; this is a key measure to seize strategic initiative. However, the formation of this new development pattern requires a process, during which the coordination of internal and external demand and structural transition will face periodic pressures.
Journalist: Looking ahead to 2026, where do you believe the most important policy and reform bridgeheads should be placed to resolve the contradiction of “strong supply and weak demand”?
Liu Wei: Addressing the issue of “strong supply and weak demand” requires that macro-governance concepts and practices constantly advance with the times. Macroeconomic policy should focus on several key areas.
First, we must persist in taking economic construction as the center and high-quality development as the theme. This is the foundation for consolidating consensus and unifying action. Facing any complex situation, development remains the foundation and key to solving all problems.
Second, the strategic focus must be clear and prominent, taking the persistence of expanding domestic demand as a long-term strategy with precision targeting. Macro-policy should firmly place its stress point on expanding domestic demand, effectively boosting household consumption and expanding effective investment. This serves not only short-term growth stabilization but, more importantly, wins time and space for resolving deep-seated structural contradictions and promoting economic transformation and upgrading.
Third, policy efficacy must be significantly improved, pursuing proactive action while maintaining intensity. In 2025, the intensity of fiscal and monetary policy has already increased significantly; in 2026, not only will this intensity not diminish, but it may be increased further as circumstances dictate. Yet, more important than intensity is policy effectiveness. Policy must be more precise, focusing on improving social expectations, boosting market vitality, and clearing the circular bottlenecks between consumption and investment, ensuring that policy dividends are tangibly converted into endogenous momentum for economic growth.
New Policy Orientations—Strengthening Macro-Policy Synergy
Journalist: We have noticed a new change in the phrasing of current macro-policy: while continuing to emphasize foresight and targetedness, it particularly highlights “synergy.” The Central Economic Work Conference explicitly proposed “leveraging the integrated effects of existing policies and incremental policies.” How should these two types of policies be coordinated to make macro-policy more proactive?
Liu Wei: Synergy is indeed a new policy orientation that requires attention. As I understand it, it mainly comprises two dimensions. The first is horizontal synergy—that is, ensuring that various macro-policies, as well as macro-policies and other economic and social policies, keep moving in the same direction to avoid mutual contradictions. The second is vertical synergy—that is, ensuring continuity and stability between existing policies and incremental policies to achieve an effective transition between old and new drivers of growth.
To achieve this multi-dimensional synergy, the primary requirement is to clarify the central objective around which the synergy revolves. This objective is high-quality development. Not only must there be synergy within economic policies, but economic and non-economic policies must also exert force in the same direction. Only by closely adhering to this goal can synergy have a direction and evaluation have a basis. Secondly, we must strive to overcome the “fallacy of composition” [7] that may arise in practice. This occurs when policies issued by a single department or region may appear reasonable and necessary from a local perspective, but when layered together, they produce contradictions, leading to poor overall effects and a decline in the efficiency of resource allocation. This reflects institutional and mechanistic problems such as fragmented management and departmental barriers [8]. Therefore, synergy requires not only consistent goals but also deepening reform and strengthening coordination mechanisms to provide an institutional guarantee for synergy. Furthermore, constantly improving the ability of cadres to grasp and apply economic laws is also an important foundation for achieving scientific synergy.
Journalist: The Central Economic Work Conference proposed to “increase the intensity of counter-cyclical and cross-cyclical adjustments.” How can the synergy between these two types of policies be managed well in the work of 2026?
Liu Wei: Combining counter-cyclical and cross-cyclical adjustments is a prominent feature of our country’s macroeconomic governance. On the surface, this concerns coordination across time dimensions. Counter-cyclical adjustment primarily targets the hedging of economic fluctuations that have already appeared; it belongs to short-term management. Cross-cyclical adjustment looks toward longer-term development, aiming to promote sustained medium-to-long-term growth.
However, emphasizing the integration of the two has a deeper meaning: balancing the quantity and quality of economic development. Counter-cyclical adjustments—such as lowering interest rates or expanding fiscal expenditure—primarily stabilize growth by expanding aggregate demand; their effect on boosting “quantity” is more obvious in the short term. Cross-cyclical adjustment focuses more on structural optimization, the cultivation of new drivers, and the enhancement of competitiveness; its core is promoting the improvement of “quality.”
History provides lessons regarding the decoupling of the two. Before the 2008 international financial crisis, some developed economies implemented excessively loose monetary policies, continuously lowering interest rates and credit standards to combat recession and maintain prosperity. Although this stimulated demand and expanded the scale of the economy in the short term, it accumulated a large number of bubbles and subprime assets, essentially trading the "quality" of long-term growth for the prosperity of short-term "quantity." When monetary policy later tightened, these subprime assets exposed risks, triggered a severe recession, and led to an economic crisis.
Coordinating counter-cyclical and cross-cyclical policies requires that macro-policy must balance short-term growth stabilization with long-term quality improvement. When expanding demand, one cannot “drink poison to quench thirst” (yǐn zhèn zhǐ kě) [9] by excessively lowering standards or overdrawing the future. Short-term policies must create conditions and reserve space for medium-to-long-term structural transformation; medium-to-long-term planning must also consider short-term realistic constraints. This is, in fact, the organic unification of addressing current difficulties and seeking long-term development, stabilizing the economic aggregate and optimizing the economic structure, and implementing demand-side management and supply-side structural reform.
New Understandings of Economic Laws—The Logical Purport of the “Five Musts”
Journalist: In recent years, the Central Economic Work Conference has summarized and refined periodic understandings of the laws for doing economic work almost every year. For 2025, it proposed the “Five Musts.” Compared with the summaries of previous years, what continuities and innovations do you see in this phrasing?
Liu Wei: Since 2017, summarizing the regularities of economic work has become an important part of the annual Central Economic Work Conference. This is actually a concrete manifestation of moving from applying the general principles of Marxist political economy to a more conscious and systematic construction of an independent knowledge system of Socialist Political Economy with Chinese Characteristics based on Chinese practice. The prominent feature of the “Five Musts” proposed this time is their high degree of specificity and problem-orientation, with each point targeting specific challenges and tasks faced in current economic development.
For example, “must fully tap into economic potential” addresses the issue of growth momentum and space at the macro level, involving the synergy of existing and incremental assets; “must persist in the simultaneous advancement of policy support and reform innovation” focuses on improving systems and mechanisms; “must achieve both ‘revitalizing through liberalization’ and ‘managing well’” corely addresses the relationship between the government and the market to enhance governance efficacy; “must persist in the close integration of investing in physical assets and investing in people” emphasizes how to optimize the development pattern from the perspective of development factors and drivers; and “must respond to external challenges by strengthening internal capabilities” emphasizes how to make good use of both domestic and international markets and resources under open conditions.
Behind the specific deployments, several core principles of Socialist Political Economy with Chinese Characteristics run through them:
First, following the law of the contradictory movement of supply and demand in social reproduction. Whether it is tapping economic potential or persisting in the simultaneous advancement of policy support and reform innovation, the core goal is to promote a balance between supply and demand at a higher level and cultivate new growth points. This is a long-standing priority of our economic work; the current deployment is a deepened understanding and specific application of this law under new situations and conditions.
Second, adhering closely to the core issue of handling the relationship between the government and the market. For instance, the emphasis on both “revitalizing through liberalization” and “managing well” is essentially a further concretization of the requirement to combine an efficient market with a proactive government, requiring even fuller "revitalization" within the framework of "managing well" to stimulate the vitality of various market entities and factors to a greater extent. This also implies higher requirements and standards for the understanding and practice of the relationship between the two.
Third, transforming the relations of production according to the requirements of the development of the productive forces, and coordinating the relationship among reform, development, and opening up. High-level development cannot be achieved without the support of high-level reform and opening up. The current propositions, such as “must persist in the simultaneous advancement of policy support and reform innovation” and “must respond to external challenges by strengthening internal capabilities,” all reflect the logic of breaking down developmental obstacles and shaping new drivers of growth through deepening reform and expanding opening up. This is the specific application of the basic Marxist principle of the unity of opposites between productive forces and relations of production, and between the economic base and the superstructure.
It should be noted that in recent years, persisting in the Party’s comprehensive leadership over economic work is no longer listed merely as a specific law of economic work. This is because the Party's leadership is the greatest advantage of the system of Socialism with Chinese Characteristics; its status and role transcend the scope of specific economic laws and serve as the fundamental guarantee for commanding economic work and all other endeavors. Under this general principle, we then deeply summarize the specific regularities of the economic work itself.
Journalist: Does the continuous summary and deepening of these regularities also mean that we are forming a macroeconomic governance system with Chinese characteristics?
Liu Wei: That is an entirely accurate understanding. The concept of “macroeconomic governance” itself is an original category based on Chinese practice. It transcends the macro-control of mainstream Western economics, which focuses on short-term demand management, and is integrated into the general framework of the modernization of the national governance system and governance capacity. Our macroeconomic governance system has at least two distinctive features. First, policy tools are more diverse and pluralistic. It includes not only aggregate policies such as fiscal and monetary policies, but also systematically incorporates industrial, regional, and structural policies into the governance toolbox, enabling more precise and three-dimensional regulation. Second, it takes institutional reform itself as an important variable for driving growth. In our country, continuously deepening market-oriented reform and handling the relationship between the government and the market are themselves key drivers for developing productive forces. It can be said that China’s macroeconomic governance is not only “policy regulation” but also “reform-driven”—it is a deep-level fusion of development and reform.
The annual summary of regularities in economic work is precisely the manifestation of this macroeconomic governance system’s continuous exploration, improvement, and theoretical sublimation in practice. The “Five Musts” proposed this time are the latest chapter in this continuous evolution, reflecting both the adherence to basic principles and the innovative wisdom in facing new situations and tasks.
New Development Models—Internal Demand-Led, Consumption-Driven, Endogenous Growth
Journalist: The “economic development model led by internal demand, driven by consumption, and based on endogenous growth” was written into the recommendations for the 15th Five-Year Plan, becoming a landmark concept. How do you understand the deep meaning of this model?
Liu Wei: To understand the new economic development model, one must first review the past growth model, which can be summarized by several characteristics. First, external demand played a huge role. Under a specific international division of labor and a particular stage of domestic development, China took advantage of its complete industrial system to import raw materials and components, process them into finished industrial products, and utilize cost advantages to export to developed countries and other developing countries. The contribution of exports to economic growth was once very prominent. Second, economic growth exhibited investment-driven characteristics for a long time; this was adapted to the historical stage of being a "shortage economy" [10] that needed to rapidly complete primitive accumulation and solve the problem of “whether something exists or not.” Third, growth momentum mainly relied on the expansion of the quantity of factor inputs—an extensive, scale-expansion type of growth. This model had its historical objectivity and necessity; we cannot judge it in isolation from the historical conditions of that time.
Now, we must transition to a new economic development model because the stage of development and the binding constraints have changed. Our country’s economic aggregate has exceeded 100 trillion yuan for consecutive years, and GDP per capita is among the forefront of upper-middle-income countries. The core issue we must now solve has shifted from “whether it exists” to “how good it is,” and from pursuing scale expansion to pursuing quality improvement. This requires a shift in the mode of development.
The three keywords of the new development model precisely respond to these requirements of the times:
First, internal demand-led. This is the inherent law for a large economy as it moves toward maturity and stability. Major developed economies, such as the United States and the European Union, ultimately rely primarily on internal demand for their economic growth. The so-called “internal demand-led” model does not mean moving toward closure; rather, it means that the circulation and growth of the national economy are primarily built on a powerful and unified domestic large market. This can enhance the autonomy and stability of economic development.
Second, consumption-driven. The principal contradiction in our society has been transformed into the contradiction between the people’s ever-growing needs for a better life and unbalanced and inadequate development. Satisfying consumption needs and improving the quality of life have become important goals of development. Consumption, as the final demand, forms a hard constraint on the supply system; it is the key force pulling supply upgrades and improving the quality of economic growth.
Third is endogenous growth. Its core lies in shifting the source of growth from a reliance on expanding the scale of factor inputs toward driving development through technological and institutional innovation. This is the vital source for the economy to obtain enduring competitiveness and developmental sustainability.
These three aspects are mutually conditional and mutually reinforcing. Among them, endogenous growth is the most long-term source of momentum. Without a substantive increase in efficiency and competitiveness, a domestic demand-led approach might lack the support of high-quality supply, and the upgrading of consumption [11] would be out of the question. Emphasizing a domestic demand-led approach and forming a stable and continuously expanding domestic market can provide valuable space for trial and error and market returns for corporate transformation, upgrading, and technological innovation, thereby better responding to external shocks. Meanwhile, consumption-driven growth acts as a critical pulling force. It is itself the primary component of expanding domestic demand; as the consumption structure continuously upgrades, it further pulls and drives innovation and efficiency gains on the supply side.
This is, in fact, the concrete manifestation of the New Development Paradigm [12] within the development model. The essence of constructing the New Development Paradigm is to achieve high-level self-reliance and self-strengthening [13], which depends on the enhancement of endogenous momentum. Its strategic basis is the expansion of domestic demand, its baseline requirement is the coordination of development and security, and its key support lies in smoothing the circulation of the national economy. Therefore, forming an economic development model dominated more by domestic demand, driven by consumption, and characterized by endogenous growth is precisely the inevitable requirement for accelerating the construction of the New Development Paradigm.
Reporter: Under this new development model, what do you believe are the key priorities that need to be addressed during the "15th Five-Year Plan" period?
Liu Wei: In fact, the important arrangements made in the recommendations for the "15th Five-Year Plan" [14] have already provided us with clear guidance. The relevant economic tasks can be summarized in several aspects, with the expansion of domestic demand still ranking at the forefront, as it provides the necessary aggregate support for high-quality development. Looking toward the development of the next five years and even longer, the plan places greater emphasis and prominence on substantive progress on the supply side and the effective improvement of the economy’s "quality." This is centrally reflected in two areas: First, accelerating the construction of a modernized industrial system. This includes promoting the transformation and upgrading of traditional industries, expanding strategic emerging industries, and actively laying out future industries; this is the foundation for cultivating new quality productive forces and improving the adaptability of the supply system. Second, strengthening innovation as the "primary driving force." By achieving breakthroughs in key core technologies through scientific and technological self-reliance and self-strengthening, we can better drive the improvement of total factor productivity.
Practice has proven that without an effective improvement in "quality," it is difficult to achieve a reasonable growth in "quantity." The focus of policy during the "15th Five-Year Plan" period must strike a balance between short-term stable growth and medium-to-long-term quality improvement. The key is to promote institutional and technological innovation through deepening reform, tangibly transform the mode of development, and cultivate powerful endogenous growth momentum. This is also an inherent requirement for forming the new development model.
(By Economic Daily reporter Ouyang You) Source: Economic Daily (February 4, 2026) Editor: Huihui