As 2025 approaches, analysts are closely watching for signals on how China plans to navigate its domestic challenges and global ambitions. Here’s a breakdown of what to expect from China’s Two Sessions in 2025.

For a thorough post-event analysis and interactive Q&A session featuring a panel of industry experts, we recommend CBBC’s upcoming “Two Sessions Debrief” on 13 March 2025. Experts including Su Yue, Principal Economist at the Economist Intelligence Unit, and Feng Chucheng, Partner, Hutong Research, will discuss the outcomes from this year’s Two Sessions and provide analysis on the political and economic implications for UK business. Sign up here.

What are the Two Sessions?

The Two Sessions are a key platform for China’s political decision-making. The NPC, China’s top legislative body, reviews and approves major policies, the national budget, and government reports, including the Premier’s work report. The CPPCC, an advisory body, gathers representatives from various sectors to provide recommendations on policy issues. Together, these meetings offer a comprehensive roadmap for China’s governance and strategic priorities.

In recent years, the Two Sessions have focused on economic recovery, technological self-reliance, environmental sustainability, and social welfare. Against a backdrop of global uncertainty and domestic pressures, the 2025 meetings are expected to address these themes while reinforcing China’s long-term goals.

Economic stability and growth

Economic policy will take centre stage at the 2025 Two Sessions. China’s leadership is likely to prioritise measures to stabilise growth and boost consumer confidence. In 2024, China set a GDP growth target of around 5% and it is likely that this will be maintained in 2025.

To achieve this growth, China is expected to implement a more proactive fiscal policy. For example, the fiscal deficit ratio may be increased to approximately 4% of GDP, surpassing the traditional 3% threshold. This move would allow for greater government spending on infrastructure projects, social welfare programs, and initiatives aimed at stimulating domestic consumption.

Other analysts have pointed out that China’s property market, which has been a significant drag on economic growth, will be a focal point. The government may introduce further measures to stabilise the sector, including support for affordable housing and reforms to address local government debt.

Technological innovation and self-reliance

Technological self-reliance will be another major theme.

The emergence of Chinese AI company DeepSeek has garnered substantial attention in recent months. DeepSeek’s recent achievements have positioned it as a formidable opponent to Western tech giants like competitor OpenAI, highlighting China’s growing prowess in the tech sector.

Nevertheless, China continues to face challenges in achieving self-sufficiency in semiconductors and other critical technologies. The 2025 Two Sessions may unveil new policies to support research and development, as well as incentives for domestic companies to reduce reliance on foreign technology.

Green transition and climate goals

China’s commitment to achieving carbon neutrality by 2060 will remain a key focus. According to The Guardian, the 2025 Two Sessions are expected to outline plans for expanding renewable energy projects, including wind, solar, and nuclear power. The government may also introduce policies to promote energy efficiency and reduce emissions in heavy industries.

Others suggest that China’s carbon trading market is set to play a larger role in achieving climate goals. The 2025 meetings may include announcements on enhancing the market’s scope and encouraging green finance initiatives to support the transition to a low-carbon economy.

Demographic challenges

China’s ageing population and declining birth rate pose challenges to the country’s long-term economic stability, and policymakers are likely to propose reforms to try to slow their effects. For example, a member of the CPPCC has recently proposed lowering the legal marriage age from 22 to 18 for men, and from 20 to 18 for women, to encourage earlier family formation.

Additionally, the government may introduce incentives for families, including financial subsidies, tax breaks and enhanced access to childcare services. These measures aim to alleviate the financial burdens associated with raising children and to promote a more family-friendly environment.​

Geopolitical considerations

The Two Sessions will also provide insights into China’s approach to international relations. Amid the constantly-evolving situation of the war in Ukraine, and with tensions persisting between China and the West, particularly over trade, the 2025 meetings may highlight efforts to strengthen ties with emerging markets and regional partners.

As such, Chinese state media have reported that the Belt and Road Initiative (BRI) will remain a cornerstone of the country’s foreign policy. The 2025 Two Sessions may announce new infrastructure projects and partnerships, as well as reiterate China’s commitment to multilateralism and global governance.

Predictions for 2025

The 2025 Two Sessions will need to achieve a balancing act between addressing immediate challenges and advancing long-term goals. Key themes will include economic stability, technological innovation, environmental sustainability, and social welfare.

While the meetings are largely scripted, they offer valuable insights into the priorities of China’s leadership. As the country navigates a complex domestic and international landscape, the decisions made at the 2025 Two Sessions will have far-reaching implications for China and the world.

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The 20th Party Congress might well go down as one of the most significant in recent Chinese history. The reason for this is less due to Xi Jinping staying on for a third term, and more to do with the glaring discrepancy between the message that the leadership wanted to convey and the one which was perceived by audiences both domestically and globally. 

Xi wanted to stress stability but to many, there appeared to be a reinforced sense of uncertainty, not least because of his explicit support for China’s highly disruptive zero-Covid policy. Xi also wanted to show continuity, but again, there was a perception of disruption, especially regarding his predecessor Hu Jintao, who – in one of the most extraordinary moments of the Congress – was be removed from the stage for reasons still not fully explained. Finally, by surrounding himself with apparently unremarkable allies and long-term collaborators, Xi raised doubts about the prospects of much-needed reforms – many of them promised for years but yet to be delivered. 

But all is not quite doom and gloom. Xi’s opening speech – a sort of CCP manifesto for the next five years – was, to an extent, anti-climactic. It included little that had not been said before, belying the alarmist headlines in many Western media. Li Qiang – although somewhat tarnished by the chaotic Shanghai lockdown earlier this year – is expected to be the new Premier and has a generally business-friendly reputation; he is expected to continue his predecessor’s policies of supply-side reforms and trade liberalisation. 

Furthermore, the promotion of former Minister for Environmental Protection Chen Jining – an Imperial College graduate who spent ten years in the UK – to Party Secretary of Shanghai, means that Xi’s ambitious Net Zero goals and green development agenda is now a key performance indicator for Party officials eager to climb the career ladder. Regarding foreign policy, the appointment of the current Chinese Ambassador to the United States Qin Gang to the Party’s Central Committee (CC) – suggesting that he will be promoted to Foreign Minister at the next Two Meetings (Lianghui) in March 2023 – also indicates a willingness to manage US-China relations more closely. It is worth remembering that current Foreign Minister Wang Yi – a Japanologist – entered office at the height of the conflict over the Diaoyu islands and subsequently managed to put the bilateral relationship between the two neighbours on a more stable footing. Qin’s appointment could therefore be seen as a sign that Beijing is clearly worried about the friction between the two superpowers and wants to defuse tensions before it’s too late.

Finally, the removal of former Xinjiang Party Secretary Chen Quanguo – who was responsible for the alleged internment of up to a million Uyghurs – from the Central Committee, despite him not having reached retirement age, should equally be seen as a positive signal, confirming recent reports that Beijing is looking for an end to the controversial policy. 

Nonetheless, Xi’s unquestionable success at consolidating power at the head of the CCP will put increased pressure on him to make good on his promises to wean the Chinese economy from its reliance on unsustainable infrastructure spending and enact the reforms needed to increase domestic consumption. And if the Hu Jintao episode proved one thing, then time might not be on Xi’s side. 

Background 

Policies 
On 16 October 2022, Xi opened the 20th Party Congress with a nearly two-hour-long speech, outlining the Communist Party’s ‘manifesto’ for the next five-year cycle. A much longer version was published later, containing more policy details and theoretical musings on Marxism with Chinese Characteristics. Yet both Xi’s oral version and the longer written one included little which had not been mentioned elsewhere before.

Mentions of keywords in the Party Congress reports in 2012, 2017 and 2020

Analysts of Chinese Party-speak were quick to point out that this year, the number of mentions of the term security (安全) overtook mentions of the ‘economy’ (经济) compared to the two previous congresses in 2017 and 2012, leading to the conclusion by some that for Xi, the economy is no longer the government’s top priority. 

And indeed, references to economic policy were mostly summed up under the newish term of ‘new pattern of development’, which refers to such concepts as the dual circulation strategy (i.e., removal of local trade barriers and balanced trade), self-reliance in key technologies, green development, and common prosperity. Commitments to reform and opening-up, trade liberalisation and openness to foreign investment were duly repeated. 

On common prosperity, Xi started by noting that income distribution – meaning policies reducing income inequality both regionally and between income groups – is the ‘foundational system’ of the policy. But he also emphasised that job creation remains the principal tool to achieve this goal, underscoring Xi’s general distrust towards a Western-style welfare state. 

More specifically, Xi said that China needs to establish a policy system to boost birth rates and bring down the costs of pregnancy and childbirth, child rearing, and schooling. This is in line with last year’s decision to ban private online tutoring but could also herald a much more intrusive approach towards family planning, perhaps even a total ban on abortions or policies penalising singles compared to families with children. 

Most ominously, Xi announced that there would be more corruption crackdowns, indicating that the Party’s watchdog – now headed by Li Xi – would focus especially on ‘sectors with a high concentration of power, funds, and resources’. And while Xi did not specify what sectors he had in mind, the recent crackdown on public fund managers involved in China’s rapidly increasing semiconductor industry as well as the post-congress suspension of PBoC vice-governor Fan Yifei provide some powerful clues to the potential targets.

People 
Although any report by Xi attracts widespread media attention, the 20th Party Congress was not primarily about him, rather, it was about the people joining him at the apex of the Party. 

The top leadership of the CCP is a pyramidal structure consisting of the Central Committee (CC), the Politburo (PB) and the Politburo Standing Committee (PBSC). Each member of the PBSC must be a member of the PB, and all have to be part of the CC. To use a slightly imperfect analogy with the British parliamentary system, the PBSC represents the front bench of the CCP, while the PB and the CC are the cabinet and the backbenchers, respectively.

Leadership structure of the CCP after the 20th Party Congress

Unsurprisingly, the PBSC attracts most of the attention as it constitutes the Party’s top leadership organ and makes the key decisions on strategies, major policies and personnel changes at the national and provincial level. In short, the PBSC is the CCP’s (and thus China’s) board of executives. 

As such, the 20th PBSC is now almost exclusively packed by people with whom Xi has worked at various stages of his career. Only Zhao Leji and Wang Huning stayed on from the previous term. Zhao, who took over from Wang in the internal hierarchy, is now responsible for the National People’s Congress and thus decides which laws and regulations get passed by the country’s legislative body. Zhao also remains the only PBSC member whose career started in the Party’s youth organisation, the Communist Youth League. Wang, who was previously in charge of the Party’s secretariat, is now overseeing the Chinese People’s Political Consultative Conference (CPPCC), which, among other things, manages the so-called ‘United Front’, including its relationship with Chinese organisations abroad.

Of the four new entrants, all have worked with Xi previously: 

• Cai Qi has shared the longest common trajectory, working with Xi during his time in Fujian (1988-2002)
• Li Qiang was Xi’s deputy in Zhejiang
• Ding Xuexiang became his secretary in Shanghai, before following Xi to Beijing in 2013
• Li Xi was Party Secretary of Yan’an, the CCP’s stronghold during the civil war period and the place where Xi spent his time during the Cultural Revolution. Li was subsequently promoted to Party Secretary posts in the key provinces of Liaoning and Guangdong. 

Other key appointees share a similar background. He Lifeng, the new economic policy czar and successor of Liu He, started his career under Xi in Fujian province, while Li Shulei, the new head of China’s important propaganda ministry, was working at the Central Party School at the same time Xi was heading the institution between 2007 and 2012.

CBBC Outlook 

A curious feature of Xi’s preference for known faces is that nearly all of them hail from China’s prosperous and entrepreneurial coastal areas. Li Qiang is probably the most characteristic representative of the pro-business Party official, heading Wenzhou – a poster child of China’s private sector – in the early 2000s. He also served as Party sponsor for Alibaba’s Jack Ma and convinced Tesla to build its first gigafactory outside the US in Shanghai. 

Yet despite this background, businesses will expect more than just warm words of support from the new leadership. Many of the reforms outlined by Xi at the onset of the Congress have been on the agenda for years. And even though there has been some progress on legal institutionalisation and poverty alleviation, critical reforms, such as better access for private businesses to sustainable financing, the removal of local trade barriers, and stable public finances of local governments currently hooked on property sales and infrastructure investments, are yet to make visible headways. 

And while Beijing has promulgated one concept after another, be it the dual circulation strategy (to eliminate local protectionism), a national social credit system (to enable a nationwide exchange of personal and company information) or common prosperity (to reduce social equality), Beijing’s structural penchant for delegating policy implementation to local governments has often meant that it was tasking the fox with guarding the henhouse, thus limiting the very effectiveness of its reform initiatives. 

Whether Xi’s handpicked new team can take a more forceful approach and overcome local resistance remains to be seen, and we will probably have to wait until the next Two Sessions in March 2023 to get a better idea of his reform agenda. But the fact that Xi defied the convention of his two predecessors, who chose to step down after two terms, also means that pressure on him to deliver results or to designate a successor could grow rapidly. And given that China will have to exit zero covid before anything can move ahead, he will have to hurry.

Entering China is a key decision for businesses of all sizes. Call +44 (0)20 7802 2000 or email enquiries@cbbc.org now to find out how CBBC can provide you with the platform to unlock your potential.

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The Politburo Standing Committee, formally known as the Standing Committee of the Central Political Bureau of the Chinese Communist Party, is China’s most powerful decision-making body and currently made up of seven top political leaders (historically, membership has varied from five to a high of 11 people in the reshuffled 8^th PSC in 1966).

The Committee is selected every five years by the Central Committee of the Chinese Communist Party, as well as by incumbent members of the Politburo and the Standing Committee. All members hold at least one high-level Party position. The current Politburo Standing Committee (the 20^th of its kind) was elected by the 20th Central Committee of the Chinese Communist Party on 23 October 2022.

Below is the current line-up of the 20^th Politburo Standing Committee (changes from the previous line up are marked ‘new’):

Xi Jinping

Xi Jinping remains as the number one ranking member of the committee. As General Secretary, he is the “core leader” of the Party and also commander-in-chief of the Chinese military as Chairman of the CCP and PRC Central Military Commissions. Xi also holds the title of President of the People’s Republic of China.

Born in Beijing, Xi was governor of Fujian and Zhejiang before being named Hu Jintao’s successor in 2008. His political theory, “Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era,” was written into the Party constitution by the 19th CCCPC.

Li Qiang (new)

Li Qiang is Party Secretary of Shanghai and a close personal ally of Xi (he was Xi’s chief of staff when he was governor of Zhejiang). Many expect him to replace Li Keqiang when he steps down from the premiership during the National People’s Congress in March 2023.

Li Qiang was in charge of Shanghai during the city’s widespread Covid lockdowns in early 2022, which some commentators have suggested is a sign of tacit approval of his willingness to run with such strict lockdowns (and, potentially, an indication that such Covid policies will continue).

Zhao Leji

Zhao Leji was formerly Secretary of the Central Commission for Discipline Inspection (succeeding another noted Xi ally, Wang Qishan), where he was instrumental in the far-reaching anti-corruption campaign that Xi kicked off when he became leader in 2012. He will succeed Li Zhanshu as Chairman of the Standing Committee of the National People’s Congress in March 2023.

Born in China’s western Qinghai province, Zhao rose through the political ranks there to eventually become Party Secretary at just 42 years old – the youngest Chinese official ever to become a provincial governor – before being transferred to Shaanxi province as Party Secretary.

Leadership structure of the CCP

Wang Huning

One of China’s top political theorists, Wang Huning is First Secretary of the Central Secretariat of the Communist Party of China. He is thought to have played a key role in assisting Xi Jinping in crafting his “China Dream” and “Xi Jinping Thought” ideologies. He is also associated with the idea behind the Belt and Road Initiative.

Born in Shanghai, Wang attended some of that city’s top academic institutions and was referred to work for the Party’s central authorities by a number of leading Shanghai politicians back in 1995. He is notable for having never been in charge of running a province or major city.

Cai Qi (new)

Beijing Party Secretary Cai Qi is a familiar name but was nevertheless a surprise entry to the PSC. That being said, he is very close to Xi, having worked under him in Zhejiang and his home province of Fujian.

Although already in a high-level position, Cai Qi gained further favour for successfully overseeing the Beijing Winter Olympics in early 2022, avoiding any Covid outbreaks associated with the event.

Ding Xuexiang (new)

Ding Xuexiang is one of Xi’s most trusted aides, serving as Director of the Office of the General Secretary of the CCP (aka Xi’s chief of staff), as well as Director of the CCP General Office. This gives him a great deal of control over access to top-level information, as well as access to Xi himself. Some speculate that, of all of the PSC members, he has spent the most professional one-on-one time with Xi , having accompanied him on many official visits in China and abroad.

Like Wang Huning, Ding has never been in charge of running a province or major city, although he served in the Shanghai Party committee when Xi was interim Shanghai Party Secretary in 2007.

Li Xi (new)

Li Xi has just taken over from Zhao Leji as Secretary of the Central Commission of Discipline Inspection. He is also Party Secretary of Guangdong Province, where he has spearheaded the development of the Greater Bay Area economic region, a favourite project of Xi’s.

Li Xi has had a fairly standard rise to power, holding various Party positions in his home province of Gansu, as well as serving as Party Secretary of the revolutionarily significant city of Yan’an, the endpoint of the Long March. Li Xi is thought to have known Xi through family connections since the 1980s.

Entering China is a key decision for businesses of all sizes. Call +44 (0)20 7802 2000 or email enquiries@cbbc.org now to find out how CBBC can provide you with the platform to unlock your potential.

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