A new book titled "Prospects for the 15th Five-Year Plan," led by Liu Shijin, a member of the national expert committee for the 15th Five-Year Plan and former deputy director of the Development Research Center of the State Council, has been officially released. At the book launch event, experts delved into the challenges and opportunities facing the Chinese economy during the upcoming 15th Five-Year Plan period, focusing on the theme of international experiences and China's strategy for crossing the high-income threshold.
Liu Shijin stated in his keynote speech that the Chinese economy is currently at a historic turning point. Since peaking in 2010, the economic growth rate has declined, with the fundamental reason being a shift in constraints from "supply constraints" to "demand constraints." Liu revealed a deep-seated macroeconomic dilemma using data: from 2023 to 2025, China's GDP deflator has been negative for 11 consecutive quarters, with nominal growth consistently lagging behind real growth. He attributes this to a "temperature gap" between macro and micro perspectives, rooted in a "structural deviation in consumption" where household consumption's share of GDP is approximately 20 percentage points lower than the international average.
To address insufficient demand, Liu systematically elaborated on his theories of "final demand" and the "height and breadth of economic growth" for the first time. He argued that solving demand shortages requires adhering to the "first principle" of stimulating the overall economic cycle through "final demand," which encompasses goods consumption, service consumption, and consumption-oriented investment. He identified issues like low prices, local government debt, and industrial overcapacity as derivatives of this core problem.
Looking ahead to the 15th Five-Year Plan period, Liu believes the growth logic must undergo a fundamental transformation: shifting entirely from a past "supply-side orientation" driven by investment and exports to a "demand-side orientation" fueled by innovation and consumption. He emphasized prioritizing consumption, particularly "developmental consumption" in areas such as education, healthcare, and social security. Liu noted that although China came very close to the high-income threshold in 2021, it has yet to cross it. He stressed that China is at a critical juncture and must break from past path dependencies, using theoretical research to support policy formulation and establish a new growth framework originating from "final demand" to achieve a historic shift from investment-export driven growth to innovation-consumption driven growth.
Other experts outlined a new framework for China's economic growth during the 15th Five-Year Plan period from various perspectives, including urban-rural structure, consumer markets, industrial upgrading, income distribution, currency internationalization, and capital markets.
Liu Shouying, also a member of the national expert committee and former dean of the School of Economics at Renmin University of China, discussed the spatial transformation of future growth from an urban-rural structure angle. He stated that after the urbanization rate reaches 70%, a new phase of urban-rural integration will begin. China's rapid, one-way urbanization path has already shifted, and building an "urban-rural continuum" is the primary approach for this integration phase. Liu Shouying believes that constructing integrated urban-rural forms and restructuring rural systems will be significant growth drivers during the 15th Five-Year Plan period. He proposed forming a continuum from megacities to counties, towns, and villages within metropolitan areas, and developing county towns into "consumer cities" in non-metropolitan areas with population outflows. He emphasized addressing the urban rights of the second and third-generation migrant workers to prevent a reversal in the modernization process of rural-to-urban migration.
Teng Tai, President of the Wanbo New Economy Research Institute, focused on achieving consumer market prosperity. He pointed out a phenomenon of "macro consumption suppression" in China, where household consumption accounts for only about 40% of GDP, 15-20 percentage points lower than the international average. He argued that fiscal policy should increase spending on people's livelihoods. Building on successful pilot programs, he suggested transferring a larger proportion of state-owned equity to social security funds, particularly to raise pension levels for rural elderly as soon as possible.
Zhang Bin, Deputy Director of the Institute of World Economics and Politics at the Chinese Academy of Social Sciences, analyzed the situation from an industrial structure perspective. Through international comparison, he found that after per capita income exceeds $10,000, the focus of economic activity inevitably shifts from industry to services, especially knowledge, technology, and human capital-intensive services. He recommended starting reforms with small-scale pilot projects and standardizing the "involution-style" investment promotion competition among local governments, shifting incentive targets from pure GDP growth to business environment and livelihood indicators.
Liu Peilin, Chief Research Fellow at the Academic Center for Chinese Economic Practice and Thinking at Tsinghua University, noted that the Chinese economy is in a unique state of "volume increase with price contraction" and should transition to a mild inflation state promptly. Analyzing the household consumption rate, he refuted the view that low household consumption propensity is the primary reason for China's low consumption rate, arguing instead that the share of household income in GDP is the key issue. He proposed implementing a "ten-year plan to double household disposable income" starting from the 15th Five-Year Plan period, focusing on increasing the share of labor compensation in primary distribution and improving the income distribution structure.
Miao Yanliang, Managing Director and Chief Strategist at China International Capital Corporation Limited (CICC), stated that the current international environment presents unprecedented opportunities for the internationalization of the Renminbi (RMB). He noted that the safe-haven status of the US dollar is showing "cracks" due to uncontrolled US fiscal policy and the weaponization of its currency. Simultaneously, the strong rise of Chinese manufacturing and the restructuring of the global trade system provide a solid foundation for RMB internationalization.
Focusing on capital market development during the 15th Five-Year Plan period, Wei Chenyang, Researcher at the PBC School of Finance at Tsinghua University and Director of the China Center for Insurance and Pension Finance, indicated that there is significant room for improvement in the proportion of property income in Chinese households' disposable income. He stated that capital markets should take on the responsibility of increasing the share of household financial assets and property income.