The 14th Five-Year Plan (2021-25) period is crucial for China to further consolidate achievements of building a moderately prosperous society, push for high-quality growth and start the new chapter of comprehensively building a modern socialist country by 2035.

Unlike before, in this period, China's internal and external development environment will undergo great changes because of emerging anti-globalization forces such as trade protectionism, unilateralism and populism. China will face both opportunities and challenges as the global economy's center of gravity, global political landscape, globalization process, technology and industry, global governance and world order undergo unprecedented revolutions.

The world will see a marked increase in uncertainties of economic growth and confrontations between major countries over the next five years. In particular, trade frictions between China and the US are spiraling, and their continuity and impacts may exceed people's expectations. In such a scenario, the global economic and political order will undergo drastic restructuring, greatly enhancing uncertainties and risks for the global economy.

Since the beginning of this year, the world's major economies have witnessed varying degrees of slowing economic growth. Affected by external factors, the Chinese economy, too, is facing mounting downward pressure. Foreign trade and foreign direct investment saw a decline in the January-August period. It's safe to say that changes in the external environment are the biggest uncertainty facing China in the 14th Five-Year Plan period and they require serious research and prudent management.

Domestically, China will see polarization in development and slowing growth. This is because China's population growth will see a medium-to long-term turning point, wherein the population increases slightly, with a decline in the number of young people. As indicated by the sixth national population consensus in 2010, from 2019 to 2025, China's young population, aged 20 to 50, will decline by 70 million. This will lead to shrinking domestic demand.

With a slowdown of urbanization and industrialization, the Matthew Effect, when "the rich get richer and the poor get poorer", will be more obvious in sectoral and regional growth. On the other hand, China may register slower economic growth in the short run and make more strenuous efforts to maintain stable, sound economic growth, as structural problems become more prominent and new growth momentum and modes are yet to yield results. In the meantime, the government will be under growing pressure in terms of expenditure, more arduous reform tasks, transformation and development.

Despite these challenges, China should seize opportunities by bolstering reforms, propel growth, keep the growth rate within a reasonable range and realize sustained, sound growth.

To start with, China should firmly seize the strategic opportunity of new technology development. Nowadays, new technologies, such as 5G, big data, block chain and artificial intelligence, are creating numerous new industries and becoming the catalyst of new growth momentum. 5G entails a revolution from information technology to artificial intelligence, and the establishing of internet of things. It will make unmanned driving, telemedicine, smart cities, smart homes and precise control all possible.

It is thus the key for China to stay ahead in the global competition as during the 14th Five-Year Plan period, China will realize full coverage of 5G base stations, have the world's largest 5G application market and promote more technological progress and the formation of new industries. This requires us to firmly grasp the strategic opportunity of new technology development by intensifying the research and development, promotion and application of relevant technologies.

Second, China should promote the deep integration of information technology and the real economy. With the development of advanced technologies such as 5G, the Fourth Industrial Revolution, with AI as its representative, is taking place. This is bringing drastic changes to traditional industries. Once it is deeply integrated with the information industry, the manufacturing sector will gradually transform itself into a customized, intelligent and zero pollution one. It will also turn the traditionally labor-intensive industry into a technology-, capital-and talent-intensive one. This requires governments at all levels to adapt to new industrial development trends by formulating corresponding industrial policies to improve the quality, efficiency and momentum of economic growth.

Finally, China should further expand opening-up and bolster reform. During the 14th Five-Year Plan period, in the face of intensifying trade protectionism and unilateralism from some countries, we should further extend the intensity and depth of reform and opening-up, seize the strategic opportunity of sustained economic globalization, get deeply involved in international industrial specialization and cooperation, make good use of both domestic and international markets and forge a pattern of all-around opening-up.

Furthermore, China's economic growth should be propelled by intensified reforms. Supply-side structural reform could be the key to pushing high-quality growth, such as creating a fair, just, open and transparent business environment with unified regulations and legal guarantees for investor protection, intellectual property rights protection and cross-border trade.

Overall, in the 14th Five-Year Plan period, China's per capita GDP will exceed $13,000. This requires us to maintain our strategic focus, prioritize supply-side structural reform, pursue high-quality growth with new development concepts and perseveringly press ahead with reform and opening-up, so as to better deal with internal and external changes to ensure the accomplishment of relevant goals.

The author is an assistant research fellow with the Development Research Center of the State Council.

The author contributed this article to China Watch exclusively. The views expressed do not necessarily reflect those of China Watch.

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